Members of a Hong Kong employers' group were told yesterday to be more selective when hiring staff and warned not to be too hasty in raising pay. The call from the Employers' Federation comes as the economy continues to recover and bosses grew more optimistic about recruitment in the last three months of the year, according to a survey. The quarterly study released yesterday by recruiting firm TMP/Hudson Global Resources found that 35.2 per cent of companies in Asia are looking to take on more staff this year, the highest level in nearly two years. This marks a significant leap over the 23.6 per cent recorded in the previous survey for July to September, and it is also the highest since the end of 2001. The report also had good news for workers fearing further pay cuts. Nine out of 10 companies said they had no plans to cut pay for senior executives. In the last quarterly survey, 40 per cent said they expected lower pay for new employees. Some managers said they even expected to see pay increases, which could indicate concern about holding on to key staff members as the economy picked up, the company said. But the federation warned that while improving business conditions meant more competition for staff, companies should not rush to raise pay. Federation chairman Victor Apps said: 'Hong Kong pay is still among the highest in the world. There is no need for any general pay increase for many years to come.' For the third year running, the federation recommended members freeze salaries in the coming year due to the poor economy and low inflation. Its members, which include all major companies, usually follow the guide. The federation also recommended that companies 'hire only people with the specific skills or experience needed to improve competitiveness'. Mr Apps said firms should also abandon the guaranteed month's bonus payment and shift to a performance-linked system. The improved employment expectations in the TMP/Hudson survey provide more evidence to support hopes that the unemployment rate will fall further. The jobless rate dropped to 8.6 per cent last month from a record high of 8.7 per cent in July. TMP/Hudson surveyed 500 companies in Hong Kong for its study and 1,500 in Japan, Singapore and the mainland. Two-thirds of Hong Kong companies plan to maintain their staff levels, and only 2.3 per cent would cut numbers. Among individual sectors, accounting, financial services and consulting are the most upbeat, with 41.9 per cent of companies planning to add staff in the fourth quarter, the survey found. It said insurance firms needed sales and customer service workers. The engineering, operations and scientific sector is also optimistic, with 41 per cent looking to increase hiring, while law firms and consumer goods companies also plan to recruit.