Financial services firms holding back on hiring, says headhunter
Global economic uncertainties and tougher rules for listing sponsors deter companies from expanding headcounts
Global economic uncertainties and anticipation of tougher regulation in Hong Kong have prevented the financial services sector from aggressively hiring this year, says a leading headhunter.
May Wong Tung, the managing director of financial services for the Asia-Pacific at DHR International, said financial services companies in Asia were still exercising caution when it came to hiring.
"We believe many of the firms looking to lay off people have done so last year. This year we may not see more lay-offs but we are not going to see any massive hiring either. Many companies are worried about the economic uncertainties and the tougher regulations ahead," Tung said.
Investment banks have stopped hiring as initial public offerings have remained weak, reducing manpower demand. Funds raised from share offerings last year dropped 65 per cent from 2011 to HK$89.82 billion while the number of new listings fell nearly 37 per cent to 64.
The Securities and Futures Commission will impose a new regulation in October making listing sponsors criminally liable if they fail to conduct proper due diligence on companies they help to go public.
Tung said this had made banks cautious in acting as sponsors, leading some to scale down their teams handling offerings. Brokers are also cutting headcounts as average daily turnover last year fell nearly 23 per cent to HK$53.85 billion.
Those that were still hiring were the private banking and wealth management departments of banks in the Asia-Pacific region, Tung said.
"There have been many studies showing the number of millionaires is increasing in the region. This has attracted new private banks to the region, while the existing ones want to expand and hire more," she said.
Bankers who had experience in yuan business were also in demand as many banks and financial firms were planning to expand their yuan teams, she said.
Although Beijing has yet to allow the yuan to be freely convertible, it has since 2009 steadily relaxed rules to enable international investors to use the currency to settle trade and investment.
Tung said the companies that had expansion plans in mainland China, India and Indonesia were among those that wanted to hire the most.
"For people who want to work in these markets, the companies usually require them to be able to speak the local language or come with experience of working in these areas. As such, US or European bankers who want to work in Asia may not find openings if they do not have Asian working experience and language skills," she said.
Tung said bonuses had dropped almost 25 per cent, with many firms cutting their housing allowances as well.
"Overall, the salary packages now on offer are better than in the worst phase of the global financial crisis in 2008 but they haven't gone back to the pre-crisis level. Many companies are still cutting their budgets."