Expat middle manager packages decline in value in Hong Kong as more Asian employees are imported
The city rises to fourth place for packages in Asia despite 2 per cent drop in their value
The total cost of a pay package for expatriate middle managers dropped by 2 per cent over the last 12 months, according to a survey by human resources consultant ECA International.
The study compared expat salaries worldwide, finding that in Asia, Hong Kong had moved up the rankings to have the fourth highest pay package, up from 5th place last year despite the drop in the value of the total package.
Hong Kong middle managers can expect an expat pay package totalling about HK$ 2,070,000.
This is lower than before because employees are more likely to be offered less lucrative permanent salary structures rather than those based on short-term assignments based on home salaries.
Analysts believe this shift in pay structures reflects in part an increase in the proportion of expats hailing from other Asian countries, where the permanent structure is more common.
“Increasingly, companies operating in major Asian hubs adopt an approach, particularly for employees sent on a permanent one-way basis, whereby the host country local salary is used as the starting point,” reads the report, which surveyed 320 multinational organisations in 170 countries.
The shift reflects the rising number of multinationals from mainland China and Taiwan, whose employees tend to have lower salaries than their counterparts from North America, Europe and Australia.
“One third of expats in Hong Kong are now from other Asian countries. Ten to 20 years ago the major expat groups were from the UK, Europe and North America, where there are relatively higher salaries,” said Lee Quane, regional director of ECA International.
Mainland China moved up in the rankings to 2nd place for expat packages, having already surpassed Hong Kong in 2013. Analysts attributed this to a need by employers to lure staff with generous packages.
“Even though total expatriate packages have increased in mainland China, the average salaries of middle managers in Tier 1 cities have actually decreased by nearly 4 per cent this year,” Quane noted.
Analysts at ECA International predicted that Hong Kong could become a more enticing destination for UK expats in the wake of Brexit, owing to the strength of the Hong Kong dollar, which is pegged to the greenback, relative to the weakening pound.
