Two-thirds of senior executives in Hong Kong, mainland China expect pay rise due to talent shortage, KPMG survey shows
- The number of senior executives expecting a pay rise increased by 53 per cent from last year, KPMG report says
- “Vast sums” are on offer to poach employees from competitors, leading to substantial increases as a retention strategy, one observer said
A shortage of talent may present a difficulty for hiring managers, but it’s good news for senior executives in Hong Kong and mainland China, two-thirds of whom across all sectors anticipate a pay rise this year, according to a KPMG survey. In addition, nearly half expect a bonus increase.
Optimism about pay increases jumped the most in the professional services and consumer sectors, where the number of executives expecting a pay rise increased by 100 per cent and 88 per cent over last year, respectively.
“It is about retention of good people, but professional services business have not been as affected as retail and hospitality businesses,” Jerry Chang, managing director of executive search firm Barons & Company said. “Firms need to retain good people and are also anticipating good business.”
Bonus expectations are running highest in the financial-services sector, with 55 per cent of respondents anticipating a heftier bonus than last year, which was 3.46 times their monthly salary, according to KPMG. About half the respondents in the real estate, consumer and information-technology sectors expect a better bonus this year.
“Banks in Hong Kong have now found themselves competing for talent on the ground,” said Andrea Randall, a partner at law firm RPC. “Vast sums are being offered to poach employees from competitors and, in response, substantial pay rises are being offered to retain staff.”
Hong Kong bankers heading to Singapore irked over ‘hire local’ push
A brain drain among mid-level managers, due to emigration and expats departing Hong Kong, has made it imperative for companies to retain talent, resulting in positive salary and bonus outlooks, Chang said.
“As there are fewer people around, companies are concerned about retaining good people,” he added. “They are willing to pay more money to senior executives, especially within banking.”
Hong Kong faces brain drain threat as quarter of under-35s plan to leave
In spite such optimism, not everyone will see a substantial pay rise, according to George Leung Siu-kay, chief executive of the Hong Kong General Chamber of Commerce. Expected weaker economic growth this year and higher unemployment due to the fifth wave of the outbreak in the first quarter will prevent an across-the-board rise, said Leung, whose organisation has more than 4,000 member firms that employ more than 1.3 million people in Hong Kong.
“Some of the sectors, especially in banking and finance, are in short supply and therefore increasing pay to retain key staff, given that Hong Kong is experiencing an outflow of talent due to emigration and travel restrictions,” Leung told the Post.
While neither the Hays Asia nor KPMG surveys reflect the fifth wave of Covid-19 infections, industry observers remain optimistic about hiring prospects for the rest of the year.
“The fifth wave might have dampened the outlook in the short term since the survey was conducted,” said Murray Sarelius, head of people services at KPMG China. “However the recently announced relaxations should bring a brisk return to the strong optimism indicated in the survey results, as has been seen in other jurisdictions, as they work their way through the pandemic and related restrictions.”
