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Employment in Asia: What’s next?
Over the past 12 months, we have been met with stories about layoffs, companies restructuring or even the China ‘slow down’.
With such stories making constant appearances on the news, it is easy to be negative about Asia’s labour market, seeing it as a weakening entity, with few bright spots. However, it is far from gloomy overall.
Despite the slightly weaker global economic sentiment, companies in Asia are still ramping up efforts to seize growth opportunities in the region. Three key sectors that are expected to perform well this year are technology, healthcare and digital.
Currently, many companies are investing heavily in technology innovation, including financial technology (fintech) services, and creating new positions with an emphasis on digital skills. Hiring is expected to continue to grow in the next 12 months across the technology sector where demand is outstripping supply.
Likewise, the healthcare sector is expected to be a bright spot in 2017, due largely to ageing populations, growing middle classes and a higher demand for quality services. Countries across Asia are expected to continue building up their healthcare systems, resulting in an increase in hiring demand for qualified professionals across the board. In certain instances, companies are getting away from distributer led model in emerging markets to create their own direct presence to boost brand and sales.
Digital also shows no signs of slowing down, as companies continue to build up their technical and commercial capabilities on their online and e-commerce platforms. We also see an emergence of specialist companies to service across industries.
In terms of hiring intentions, 44% of employers surveyed across China, Hong Kong, Taiwan, Indonesia, Malaysia, and Singapore for the 2017 Michael Page Salary and Employment Outlook said they would be increasing their company headcount; while 49% said they would maintain their current headcount. Mid-level employees appear to be the most sought-after by companies (60%), as companies look to hire individuals who can make a quick impact. Conversely, we expect to see lower levels on new graduate hiring.
Continued growth of contract employment
Contracting appears to have risen in popularity as a talent solution. In Hong Kong and Singapore, more than half (60%) of companies surveyed currently use contractors, primarily to overcome challenges in permanent headcount approvals. Currently, most contractors are in operations, technology, financial services (reflecting the tightening sector) and business support/administration positions.
Overall, salary increases in Asia are expected to remain modest – almost half surveyed (48%) indicated that the average increment within their companies in the next 12 months will be between 1 and 5%. Exceptions are China and Indonesia, where 61% and 82% of surveyed employers are expected to provide increases of above 5%. While employers have agreed that salaries are an important retention tool, other popular employee engagement initiatives include opportunities for career progression and learning and development.
Across most of Asia’s diverse markets, competition remains intense as domestic brands — historically seen as second place to overseas multinationals, as far as candidate preferences are concerned — compete with their foreign counterparts for top candidates. Mainland China, in particular, has seen the meteoric rise of various local brands, now multinationals in their own right and visible to the world.
Many companies face the perennial challenge of finding candidates who have an international perspective, strong knowledge of local markets and the requisite language skills. To stand out from the competition, more companies are now paying attention to employer branding, communicating clearly to employees and potential candidates what the organisation stands for, as well as its culture and values. Salary remains a key influence but increasingly, talent development, long term career path, commitment to technology and innovation are impacting the decisions of discerning candidates.