Amid global economic uncertainty, a survey by Mercer Hong Kong shows that multinationals operating in the city are starting the year with a healthy dose of optimism, with 44 per cent expecting business performance to be better than in 2013.
The Mercer survey, with respondents from various industries, also found that companies plan to offer higher pay hikes, with an average rise of 4.6 per cent in 2014, versus 4.4 per cent in 2013. One in four companies plan to increase their headcount in 2014, while 70 per cent expect to maintain existing headcounts.
According to the survey results, 56 per cent of the 158 multinational companies surveyed expect this year's business performance to be the same as in last year.
Travis Barton, Mercer Hong Kong principal and talent business leader, says health-care and pharmaceutical firms were the most aggressive, eyeing an average pay rise of 5.7 per cent in 2014.
"Within Asia-Pacific, Hong Kong is a mature market, so we are seeing salary increases that are comparable with similar markets, including Taiwan and Singapore," as well as mainland tier-one cities, Barton says.
She clarifies that any wage adjustment will likely be offered individually based on performance. She also notes that other factors - such as career advancement, employee experience, benefits and the work environment - also play a critical role in sweetening the employment package.
"Companies are being careful not to let labour costs run out of control, while they still need to ensure that pay remains relevant to market forces as part of the retention plan," she says. "While important, salaries only form one part of the employee value proposition."
Another survey, the 2014 first quarter Employment Outlook Survey by workforce solutions firm ManpowerGroup, also reports respectable hiring plans by Hong Kong companies. Of the 809 employers surveyed, 18 per cent expect to boost headcount in the first quarter this year. Four per cent anticipate a decrease, while the rest intend to maintain their staffing levels.
Hiring will be ramped up in mining and construction, transport and utilities, services, wholesale and retail trade, manufacturing, finance, and insurance.
Lancy Chui, regional managing director of ManpowerGroup Greater China Operations, says the construction sector will be especially busy, with hiring expected to be 7 per cent higher compared with the first quarter of 2013, thanks largely to ongoing infrastructure projects and efforts to boost the supply of affordable homes in Hong Kong.
Chui notes that while employers are desperate for skilled labour and experienced professionals, many young people are reluctant to join the industry, as many of them consider the work hard and the career prospects limited.
Industry data shows about 40 per cent of the 320,000 registered construction workers in Hong Kong are now aged 55 or above.
"This has put even more strain on an already stretched construction labour market," says Chui. She adds that the government has set aside a HK$300 million training fund to attract new blood amid a shortage of about 4,000 workers.