Asia Increases Salaries to Keep Talent
Companies in the Asia-Pacific region are looking to increase their headcount and using higher pay as a staff retention strategy, according to a new study from human resources agency Hudson.
The report, released today, was based on a survey of 2,500 employment executives from key business sectors in China, Hong Kong, Singapore and Japan.
Gina McLellan, Hudson's Hong Kong country manager, said in the report: "Expectations are at a high level in most markets and still rising in most."
According to the study, permanent employment expectations for the fourth quarter have risen in all the markets surveyed compared to the previous quarter, except Singapore where expectations have remained steady.
Of the four countries, Japan had the highest hiring expectations which increased from 60 percent in the third quarter to 65 percent this quarter.
Expectations in China have also risen, from 60 percent between July and September this year, to 64 percent in the fourth quarter. Hong Kong saw the same upward trend, where 54 percent plan to hire more staff this quarter, an increase from 49 percent from the previous quarter.
Singapore is the only market where hiring expectations have remained constant, where 54 percent of respondents indicated plans to increase headcount.
"The abundance of opportunities for talented candidates means that average employee tenure is low and many employers are having to make counter offers to retain the staff they need," McLellan noted.
Low average employee tenure is an issue in most of the markets surveyed, the Hudson report said. Across China, Hong Kong and Singapore, more than one-third of all employees leave within two years.
In Japan, however, employees are likely to stay with their companies longer than those in the other markets surveyed. Companies in the IT and telecommunications sector--which is undergoing a period of volatility with mergers leading to high staff turnover--reported the lowest tenure rates, with 58 percent leaving within two years. This is more than double the average for all sectors.
The Hudson report also noted that on the whole, the most important incentives to retaining staff are higher salaries, promotions and changes in roles. In Singapore, for instance, 81 percent of respondents surveyed indicated that they upped salaries to retain staff, more than in any other market surveyed.
Some 93 percent of respondents from the manufacturing sector, as well as 90 percent of respondents in the IT and telecommunications sector in the island-state, indicated that higher salaries are particularly important in persuading employees not to leave.