Director of Consumer & Retail and Sales, Marketing & Communications
Impact of COVID-19 on Talent Strategies in Hong Kong
Survey Results for the Consumer Sector
The market is clearly a challenging environment for consumer-centric industries in Hong Kong. The effects of COVID-19 have compounded the challenges created by the social unrest, and we surveyed our clients to understand how they were reacting and how their longer-term plans would be impacted. This survey engaged around 50 organisations and took feedback from senior HR and commercial leadership across the commercial sector, including retail, consumer goods, real estate, hospitality and tourism, and food and beverage.
The results are unsurprising in some ways with the majority of respondents identifying that their organisations have been moderately to severely affected both in Hong Kong (94%) and globally (92%). There are however some positives too – here is a summary of the key statistics:
Responding to the crisis, businesses were forced to adopt work from home (WFH) strategies. Positively, the majority (70%) of respondents feel that their employee’s productivity level was not affected when working from home. We also posed the question of "what lessons has the business learnt to result in improvements to a WFH strategy?". 61% said that setting clear and measurable targets for employees to follow was the most critical, followed by offering better technology for employees and allowing access to the office if needed.
Cost & Talent Management
50% say employees will still be eligible for salary review and potential increase within 2020, which is a positive sign.
As a result of COVID-19, the majority of businesses have chosen to ask employees to take unpaid leave or shorten their business hours. 37% remain unaffected however which is surprisingly high based on how the sector has been impacted relative to others. An overwhelming 76% of businesses with physical outlets have reduced their business hours, but it is natural that businesses with brick-and-motor stores were greatly impacted. 70% of respondents confirmed there have been no change to salaries, and 50% say employees will still be eligible for salary review and potential increase within 2020, which is a positive sign.
In terms of managing ongoing talent pipelines, 61% have immediately implemented hiring freezes, and 18% have already implemented headcount reductions. When asked what the remainder of 2020 looks like, 24% say they expect to reduce headcount by 10%, 33% maintain that their headcount will be unaffected, and 47% responded that hiring will be for critical roles only.
Again, whilst the impact on recruitment is to be expected, the ongoing impact on headcount is less severe than anticipated and a sign that companies are prepared to weather the storm.
66% of respondents with online services expect to increase their investment focus in this area by at least 10% over the remainder of the year.
In relation to online, we see more positive results in this area, as is to be expected. For companies with online businesses, 77% of respondents had experienced an increase in online sales by at least 20% YOY as of April 2020. Additionally, 66% of respondents with online services expect to increase their investment focus in this area by at least 10% over the remainder of the year. In the meantime, 30% of respondents with physical outlets expect to close at least 10% of their outlets over the remainder of 2020.
Echoing the focus of online business, eCommerce, Digital Marketing and CRM are the most in-demand functions to hire for in the remainder of 2020, followed by Sales and Operations. These skills have been in continuous demand prior to the downturn and it seems that competition to secure them will be as fierce as ever.
44% of respondents feel that business will begin to recover before September, and 74% feel that recovery will arrive before year end.
Looking ahead, 44% of respondents feel that business will begin to recover before September 2020, and 74% feel that recovery will arrive before year end. Given the depth and breadth of this pandemic and the global uncertainty of when life will return to normal or a new norm, this is considered a highly positive outlook. As businesses return to the office, shops extend their hours and trading slowly becomes busier, time will tell how we bounce back from this crisis. The world has undoubtedly been transformed by the COVID-19 pandemic and the way that organisations both continue to respond and re-strategise for the future will continue to shift the competitive landscape.
If you would like a copy of the full report, email ConnectedGroup’s Marketing & Communications Manager, Stephanie Levy at email@example.com.