Job market faces reality check
This year, pay rises for Hong Kong’s workforce may generally have been “in line with expectations”, but that does not mean employees are necessarily satisfied with what they got. Recent salary increases in most sectors and for most grades were kept within 5 per cent. This tracked the rate of inflation and reflected lingering economic concerns among employers.
Reading the signs, staff were realistic enough not to expect a significant pay hike, and that remains the case. But as the latest Classified Post Pay and Job Mobility Survey also shows, there is another side to the story.
Feedback from the online poll, which was conducted during the first quarter, indicates that 54.2 per cent of the more than 6,800 respondents think their next pay review is also unlikely to exceed 5 per cent. Others are a little more hopeful, with 32.9 per cent of participants reckoning on a forthcoming pay adjustment of between 6 per cent and 10 per cent.
Most striking, though, is the closely linked finding that nearly 58 per cent of respondents said they plan to change jobs in the coming six months. In Hong Kong, such figures are never low – for the third quarter of last year the comparable result was already 56 per cent. But with the overall job market clearly gaining pace, there is now likely to be less talk and more action among individuals who have come to the conclusion that moving on – rather than moving up from where they are – is the surest route to brighter prospects and better rewards.
“The survey results don’t surprise me,” says Anthony Thompson, senior managing director for Michael Page International and Page Personnel. “We are seeing high levels of activity, with well over half the companies we deal with expecting to increase headcount, but it is not across the board.”
Candidates should do their research and proceed with due caution. It is a mistake to assume that moving to a similar role with a different company will bring a 10 to 15 per cent pay rise.
For people with in-demand skills, industry know-how, and relevant supervisory or management experience, there may be good chances to negotiate a sizeable premium on current income. But employers are not inclined to loosen the purse-strings unless they are convinced that a new recruit is ambitious, career-minded, and can genuinely add value soon after joining.
“Candidates shouldn’t just be looking for an increase in remuneration,” Thompson says. “They should want to take the next step or half-step up in terms of responsibility and can’t expect a lot more pay [elsewhere] for doing the exact same role.”
Companies, of course, have variable pay structures and can always bend their own rules to attract or retain key staff. At present, those in frontline, revenue-generating or technical positions are particularly sought after. But even in such cases, employers often prefer to emphasise incentives and opportunities for training and career development, rather than commit to bigger base salaries.
“In the end, the laws of supply and demand will determine remuneration levels and people’s ability to move,” Thompson says. “But if they are planning to move, candidates should note that even in back-office and infrastructural roles, pay is being tied more closely to performance.”
James Ash, group COO for recruitment firm Ambition, has noticed a clear shift in perceptions in the past three to four weeks. Before, well-qualified candidates might talk of moving, but remain risk averse because of the uncertainty surrounding any switch to a new employer or industry. But Ash notes a discernible change of mood, first in the commercial side and now in finance.
“We have had record weeks in terms of new jobs from employers,” Ash says. “And that means there is a degree of safety and comfort for people who want to move on for reasons of salary or career progression.”
In the coming months, Ash expects to see most movement among junior-level and frontline managers. During the downturn, they often had to juggle operational and management duties for long periods, keeping the show on the road and covering for cost cuts.
“That is where organisations will get the most staff turnover,” Ash says. “It is by far the most dissatisfied group in terms of work-life balance, remuneration and benefits.”