Some Insights Into Salaries and Jobs In Asia During 2017

The 2017 Hays Asia Salary Guide has been released, and the biggest news to come out of it is Singapore’s skill shortage epidemic. The shortage threatens to impact Singaporean employers in the year to come.

The Realty Management Associates and recruiting trends gathered from over 3,000 employers throughout Japan, Hong Kong, Malaysia, China and Singapore. Information and salary ranges come from 6 million employees and over 1,200 different roles.

An astounding 96 percent of businesses in Singapore are concerned about the skill shortage epidemic affecting their operations as they have difficulties finding skilled individuals to fill their open positions. Companies recognize the importance of attracting and retaining top talent to get a competitive edge, and these skill shortages make it even more important.

Because of this well-documented issue, experts are encouraging many employers to invest in their existing staff with training and development opportunities. Employers should also review and adjust their recruitment practices to gain the upper hand in acquiring talent.

Salaries

While most employers in Singapore plan to increase salaries between 3 and 6 percent, 34 percent of employees surveyed in Singapore expect more than a 6 percent raise.

This disconnect in salary expectations requires employers to carefully balance offering a competitive salary to attract skilled workers and to manage the salary for existing workers.

If new hires receive a higher salary, or quicker and bigger increases, it could cause tension between new talent and existing staff.

Benefits

In all of the countries surveyed, 85 percent of employers offered benefits to employees in addition to salary and bonuses.

Healthcare was the top benefit, followed by life insurance, car insurance with a cheap motor trade insurance, pension, housing allowance and a gym membership. A protein promo’s study revealed that the benefit of a gym membership is highly attractive among almost 80 percent of employees.

Bonuses

In Singapore, 66 percent of employers are planning on awarding bonuses to all of their employees, and 25 percent plan to offer bonuses only to some employees.

In all of the Asian countries surveyed, bonuses were typically based on either company-wide or individual job performance.

However, 10 percent of staff bonuses were guaranteed regardless of performance, and 34 percent were based on team performance.

Staffing

In the past 12 months, 36 percent of Singaporean employers added to their permanent headcount, 23 percent decreased permanent staff and 41 percent remained unchanged.

In 2017, 32 percent of Singaporean employers surveyed plan to increase permanent staff, 15 percent plan to reduce headcount and 53 percent intend to stay the same.

In the last year, a little over half (51 percent) of employers in Singapore utilized temporary staffing. Up to 65 percent of employers used a recruitment firm, while 37 percent brought in part-time staff, 26 percent hired casual employees and 14 percent participated in job-sharing agreements.

In 2017, 19 percent of surveyed employers plan on using temporary staff more than last year.

Other Findings

While foreign employees make up 21 percent of Singapore’s workforce, making it the most diverse in the region, it is a 7 percent decrease from the past year. China employs the fewest foreign workers at 6 percent, followed by Japan at 9 percent, Malaysia at 11 percent and Hong Kong at 12 percent.

Singaporean employers improved their gender diversity thanks to 31 percent of management positions held by women, up 4 percent from last year.

Management roles in Malaysia and China are filled 35 percent by women. 33 percent of senior positions went to women in Hong Kong. Japan is last in gender diversity, with 22 percent of management roles filled by women.

Seagate Closing Plant And Laying-Off 2,100 Employees In China

In July 2016, Seagate Technology announced it would be letting go of 6,500 employees globally.

A large part of these layoffs were expected to be in Malaysia, by shutting down the firm’s factory in Penang (3,000 staff).

As part of the global cost cutting exercise, Seagate now announced it will be closing a manufacturing plant in China (Sozhou) and laying-off 2,127 employees.

The 1.1 milion square foot facility was bought by Seagate for $1.9 billion in 2006.

As per the company, they will continue to invest in their factory in Wuxi, China and optimise the plant to meet current demands from the market.

Seagate is facing difficulties since the demand for hard-disk drives has been on the decline. It sold ~39 million hard drives in 1Q 2017, as compared to ~60 million in 1Q 2015.

Most Employees In Asia Reject Counter-Offers From Employers

A recent survey from recruiting firm Hays says that last year around 61 percent of employees in Singapore rejected a counter-offer from their bosses to make them stay in the firm. Meanwhile, 30 percent of employees claimed that they accepted their offers and stayed.

Such counter-offers ranged from salary increases, more company benefits, a highly sought-after promotion or a new job title, more responsibility, a change in the current role, or more involvement in projects. These types of counter-offers are made in the hope that managers and CEOs convince employees to stay at the firm.

Hays’ survey revealed that while 30 percent of employees said that they accepted the counter-offers and ended up staying with their employers for more than 12 months after accepting the counter-offer, 9 percent said they ended up leaving the organization anyway less than 12 months after receiving the counter-offer. For these 9 percent, those counter-offers from their employers were not enough to make them stay in the long run.

People reject counter-offers because in most cases it’s too late” says Lynne Roeder, Hays’ managing director for Singapore “Whether it’s because they want to take the next step in their career or they want to broaden their professional horizons, chances are they made their mind up when they applied for that other job. It could also be that they wish to change industries or simply because they are currently unhappy in their present role. Before considering presenting a counter offer, employers should be wary that once an employee has announced their intention to leave, their long-term loyalty can come into question.”

Singapore is not the only area where a high number of workers are rejecting counter-offers from their employers. Hays has conducted similar research throughout Asia and found that 45 percent of workers in China, 56 percent of workers in Hong Kong, 61 percent of workers in Japan and 63 percent of workers in Malaysia said “thanks but no thanks” to the counter-offers they received from their bosses.

This makes Singapore tied with Japan for the second-highest rate of employees ditching counter offers and leaving their firms, with Malaysia having the highest rate and China having the lowest.

Salary Growth Rates Expected Across Asia Pacific In 2017

Mercer recently performed research on the nominal wage growth occurring in Asia-Pacific countries, and found that that employees should be receiving slightly higher salary increases in 2017 compared to 2016.

The region is seen as an outlier due to the uncertainty of the global economy, and the fact that it is expected to perform above the global average. Inflation is low for most of the countries, so that helps to make the real wage growth relatively better.

Expected Percentages

Two countries that have the largest percentage of salary growth are Vietnam at 9.2 percent and India at 10.8 percent.

In addition, the financial regions of Singapore and Hong Kong are both expected to see about a 4 percent increase.

Countries that are among the lowest with increases between 2-3 percent, include Australia, New Zealand and Japan.

salaries in asia 2017

Employee Pay Levels And Rewards

Korea, Australia and Japan all have starting salaries that begin at about $30,000, and as employees move up the ladder, salaries rise steadily to the point where they could be making between $250,000 and $350,000.

In many of the countries in Asia (especially China), executives that are higher up in companies will earn better paychecks than their counterparts in the United Kingdom and the United States. However, this is only keeping salaries in mind, since things are different when the long-term incentives and social security benefits available in Europe are brought into the equation.

In Asia countries need to focus more on benefits and take a tailored approach. For instance, Korea and Japan both have an aging workforce with the average age of 45, and the benefits provided revolve around retirement and long-term incentives, whereas places with a younger workforce like in the Philippines, Indonesia and India focus on learning and development along with flexible benefits.

Turnover

Turnover seems to be an issue for companies in just about all of the Asia-Pacific countries as the research uncovered a double-digit turnover rate. The only two countries that aren’t facing these high rates of turnover are New Zealand and Japan.

Tech Firms In Asia Raise Salary Budgets Due To Rising Turnover

Experts might expect that, given the fluctuating state of the global economy, employees would want to retain their positions for longer periods of time. However, at least in the technology industry in the Asia-Pacific region, and in Singapore, specifically, this does not hold true.

New reports show that technology companies in Asia-Pacific have high voluntary employee turnover rates. These high turnover rates are a surprising outcome considering the high levels of instability and uncertainty in economies around the world.

In fact, voluntary turnover rates in all markets, except for Japan and South Korea, are higher than 10 percent. Singapore is fourth when compared to all regional major markets at 11.7 percent, trailing Australia, Malaysia and India in terms of the highest voluntary turnover rates.

These stats came from the Radford Trends Report, which publishes surveys and reports about compensation and development in more than 80 countries. Radford is a part of Aon Hewitt.

As a result of the increasing voluntary employee turnover, the report shows that many of the companies in the region have started to create hiring plans that might be deemed more aggressive than normal. Two-thirds of companies in the technology sector in Asia-Pacific have created detailed plans to help address this situation.

India is also leading this trend, with 13 percent of the companies implementing an aggressive hiring plan. Companies in India are also reporting plans to take their salary increase budgets from 10.5% in 2016 to 11% in 2017.

While the salary increase isn’t quite as drastic in Singapore as it is in countries like India or Indonesia, it isn’t far behind.

Companies in Singapore are also working to improve their employee retention. To respond to median voluntary turnover at 11.7%, technology companies in Singapore are keeping more aside for salary increase budgets (4.4% in 2017 vs 4.2% in 2016).

technology it company salary increase 2017 asia singapore

Condition Of The Job Market In Asia (2016)

The Hays Global Skills Index is a report that aims to evaluate the labour market in various countries, based on the following criteria.

  • Education flexibility and quality.
  • Resident participation in the labor market.
  • Flexibility and openness of the labor market.
  • Mismatch in the talent that employers need and what is available in the market.
  • Wage pressures (overall).
  • Wage pressures (highly skilled industries).
  • Wage pressures (highly skilled occupations).

Each indicator is ranked individually out of 10 possible points and the scores are compiled to create the overall score. A lower score means that an indicator is putting less pressure on the labour market (which is good) and a higher score means that it is exerting more pressure.

Here’s how countries in Asia fared.


Singapore

The recruitment market is still active for a variety of different industries, including banking and finances, life sciences and information technology.

Standout Stats:

  • While economic growth has slowed over the past few years, the real GDP continues to grow.
  • Employment continues to grow, even though it’s at a slower rate than it has been previously.
  • Overall wage pressure has experienced a slight decrease, but there is greater upward wage pressure than in the past, for high skilled industries.

Overall, Singapore scored a 4.7, the same score it received in 2015, with good education flexibility/levels and labor market participation as the primary causes for the low number..

Companies are using more contract or temporary employees in Singapore.

singapore-labour-job-market-2016


Malaysia

While the economy in the rest of the world took a significant hit, Malaysia faced the difficulties well, coming out better off than analysts would have expected.

Standout Stats:

  • The economy continues to grow, even though it’s at a slower rate that past reports have found.
  • Analysts are predicting that Malaysia’s GDP will grow to between four and five percent, in 2016 and 2017.
  • The Ringgit depreciation will open the doors for more exporters.

Malaysia came in with a score of 5.1 for 2016, the first time the country has been included in the index.

Labour market flexibility and openness is the biggest concern for Malaysia.

malaysia-labour-job-market-2016


Hong Kong

The open economy in Hong Kong means that it can be easily influenced by outside factors, such as the slowing growth of China’s GDP.

Despite that, Hong Kong continues to be a regional hub and financial center, with an active labour market.

Standout Stats:

  • Thanks to the effects of the Chinese market, Hong Kong’s economic growth is much slower than previous years. The slow down is also caused by drops in consumer spending and private investment in capital.
  • Hong Kong’s labour market is strong and active, with increased support from the fiscal policy.

Hong Kong scored a 4.5 this year, the same score it received in 2015.

There has been a decrease in labour market participation rates and increased talent shortages, which are leading to wage pressure overall.

hong-kong-labour-job-market-2016


China

China’s market, which impacted Hong Kong’s overall scores, also saw a noticeable drop in its own scores.

Standout Stats

  • Experts predict that the Chinese economy will grow by about six percent in 2017. A welcome growth pattern after the sharp and severe downturn that China experienced. New reports show that the exports and investments in infrastructure are balancing the lack of corporate investments.
  • A slowdown in some industries, like steel, coal and financial services, when combined with fast growth in credit, could still put this growth in jeopardy.

China scored 4.3 this year, lower than in 2015, when the country scored 4.7.

A 1.2 score in the flexibility of education and a 1.9 in the participation of the labor market, are offset by an 8.1 in the flexibility of the labor market.

china labour job market 2016


India

India is another country whose scores have been, and will continue to be, affected by the global economy.

Standout Stats

  • In the next few years, the population of individuals who are able to work is expected to experience a very positive growth.
  • Current data shows that India’s GDP is in a positive spot of growth.
  • Unfortunately, investments aren’t growing at the same speed.

India saw lower pressure in the labour market, down to 4.8 this year, from 5.0 in 2015.

Upward pressure is coming from labour market flexibility and overall wage pressure.

india-labour-job-market-2016


Australia

Australia has experienced a big shift being made from mining to service-related industries such as education, health, retail and tourism. This change has led to greater business activity.

This is offset, though, by employers being slow to catch up to salary pressures indicative of the growth. They may soon feel the increased pressure because of the growing turnover and lack of qualified and highly skilled candidates.

Standout Stats

  • Consumer confidence and the wage growth seem to be improving.
  • A huge growth in exports led to GDP growth, which is expected to continue.
  • Business investments, however, have decreased, mainly due to the changes in the mining industry.

There is a higher pressure on the labour market in 2016, as Australia scored a 5.1. In 2015, the country scored a 5.0.

The labor market tightened, due in great part to the country’s talent mismatch. The shift in the economy’s overall focus from mining to service means that employees don’t have the skills necessary for new and emerging industries.

australia-labour-job-market-2016

One frequently occurring theme throughout the 2016 Hays Global Skills Index is that all over the world, reports are showing that the gap between available and needed skills is widening. Many of the countries in Asia are no exception to that.

Lower Salary Increases Expected in 2017, For Most Of Asia Pacific

As per a report by Willis Towers Watson, salaries in Asia Pacific are expected to increase by 5.9% in 2017.

For 2016 they had predicted an increase of 6.4%. However, the actual salary increase in Asia Pacific was 5.8%.

If the same pattern plays out in 2017, then Willis Towers Watson expects an actual increment that is a fair bit lower than 5.9%. That will make it the third consecutive year of declining budgets for salary increments.

bonus-salary-increment-asia-2017

If these numbers are adjusted for inflation, then the real salary increase in 2017 is projected to be 2.9% in Asia-Pacific, as compared to an actual increase of 3.5% in 2016.

Here is a breakdown of the numbers for several countries across Asia Pacific.

Country Projected Salary Increase %

(2017, After Inflation)

Vietnam 6.4
Bangladesh 5.0
Pakistan 5.0
China 4.9
Philippines 4.4
Thailand 4.4
India 4.3
Indonesia 4.3
Cambodia 4.0
Singapore 3.2
Malaysia 3.1
Japan 1.9
Hong Kong 1.7
Australia 0.9
Myanmar -2.2

 

“We are seeing lower salary increase budgets across much of the region,” stated Sambhav Rakyan, Business Leader, Asia Pacific, at Willis Towers Watson.

Singapore On Top Of Asian University Rankings In 2016

When it comes to institutions of higher learning, Asia has some high quality universities and colleges compared to many other regions in the world.

According to the Times Higher Education’s (THE) Asia University Rankings, the top three countries in the area are Singapore, Japan, and China.

In fact, for the first time since the list has come out (four years ago), Singapore is sitting pretty at the top of the list. What’s most remarkable is that Singapore has not only taken the pole position but second place as well.

Traditionally, Chinese and Japanese institutions have been in the top three spots, but due to some impressive work by the Singaporean government in the past year, these institutions have achieved increased success.

Rankings at a Glance: Top Ten Asia Universities 2016

THE Ranking World Ranking Name Country
1 26 National University of Singapore Singapore
2 55 Nanyang Technological University (NTU) Singapore
2 42 Peking University China
4 44 University of Hong Kong Hong Kong
5 47 Tsinghua University China
6 59 Hong Kong University of Science and Technology Hong Kong
7 43 University of Tokyo Japan
8 116 Pohang University of Science and Technology South Korea
9 85 Seoul National University South Korea
10 148 Korea Advanced Institute of Science and Technology South Korea

 

As you can see, China and Hong Kong dominate this year’s top 10 list. In fact, the prestigious Peking University tied with NTU for the second spot. That, however, does not diminish Singapore’s accomplishments in the slightest.

In addition to monitoring and tracking Asian universities, THE also keeps a record of all college rankings worldwide. For the last few years, the Singaporean government has taken a strong stance on education by working hard to create world-class universities that bring pride to the country. The standing for both the National University of Singapore and NTU is just the result of a somewhat meteoric rise in world rankings. NUS has climbed fourteen spots since 2012 to be ranked 26th place last year. That, however, pales in comparison to NTU’s incredible 119-spot leap to get to 55th place, all within the last five years.

As far as China and Japan are concerned, both nations are currently tied for the number of universities within the top 200 of THE’s worldwide list. Each country has 39 institutions listed, but the edge goes to China, who has 22 in the top 100 compared to Japan’s 14. Ultimately, however, considering the population difference between the two, Japan’s standings are arguably a bit more substantial. That being said, however, the University of Tokyo did drop from first place to seventh. That drop is significant, especially when compared with China’s two top-ten universities.

When it comes to Singapore, the country has been able to make a lot happen in just a short amount of time. According to Gerard Postiglione, a chair professor at the University of Hong Kong, the Singaporean government has spent a lot of time and money to strategically place its top two universities at the head of the list. In an effort to compete globally, the government has created a lot of value regarding its higher education.

Another reason for Singapore’s standing this year is that the country has reached out internationally. It also did a lot to entice top talent from around the globe. Singapore has a very inviting immigration system which allows the best and brightest to attend its institutions.

Moving beyond Singapore, it’s fair to say that Hong Kong, South Korea and Taiwan are fast becoming top competitors in the region. With twenty-four institutions each, both South Korea and Taiwan represent the most universities after China and Japan. However, the edge clearly goes to South Korea, which has two top-ten institutions on the list this year.

Hong Kong has done well also and is a good competitor in the international education community thanks to six institutions on the extended 200 list, and each of them is within the top 45.

According to Tony Chan, president of the Hong Kong University of Science and Technology (in sixth place), what makes the area rich in education is a variety of factors. As a gateway into mainland China, Hong Kong has a free flow of information, a diverse group of locals, and a low tax system that incentivizes people to live and work there. Overall, the success of Hong Kong is indicative of a larger positive trend in Asia. As far as Tony is concerned, the area will only become richer, and the universities will only become more successful.

This year, the THE Asia University Ranking features twenty-two countries, including first-timers Bangladesh, Qatar, and Indonesia. This number is higher than last year, which only had fourteen nations in the ranks. It would seem that Tony is right, in that the trend towards better higher education is growing in the region. Soon, titans like Japan and China may have to make room for the new guys. But, for now, Singapore can take a moment and pat itself on the back.

JPMorgan Chase Fined Due To Illegal Hiring Practices

JPMorgan Chase has been under investigation for the past 3 years, by Federal authorities in the USA, to ascertain whether the bank engaged in bribery at its offices in Hong Kong and China.

More specifically, the issue at hand, was whether the bank hired children of powerful people/officials, in order to win business/deals.

Some examples include:

  • Hiring the son of the Chairman at China Everbright Group, a government controlled conglomerate, after which JPMorgan Chase won several big deals from the organisation.
  • The daughter of a senior railway official being hired in JPMorgan’s Hong Kong office. Around that time, the bank was selected to take China Railway public and raise over $5 billion.

The Federal Reserve and the Office of the Comptroller of Currency, have reached the conclusion that JPMorgan Chase violated the Foreign Corrupt Practices Act, which makes it illegal to bribe a foreign government official.

It is estimated that the amount the bank could pay to settle this issue is around $200 million.

Goldman Sachs Faces Tough Times In Asia. 30% Of Bankers Laid-Off

Goldman Sachs is planning to lay off 30% of its investment banking staff in Asia (excluding Japan), where the firm currently employs around 300 people.

Most of the employees being laid off are from the Singapore and Hong Kong offices. However, staff in other offices in the region will be affected as well. In total, approximately 90 bankers will be made redundant.

In effort to expand in Asia and take advantage of the opportunities, Goldman spent a number years building its presence in the region. However, the increased presence did not lead to enough profit, due to market conditions and tough competition from local banks.

This year, there has been a decrease in the number of deals/offerings in Asia, as well as the revenue bankers earned from IPOs, M&A deals and debt offerings. Goldman Sachs also lost out to local competitors; for example in Hong Kong 7 of the top 10 IPOs this year were handled by Chinese banks (as per Bloomberg), and the ranking for Goldman is the lowest since 2008, as far as equity offerings in Asia are concerned.

Asian Job Market Outlook For Q4 2016

Manpower surveyed around 15,000 employers in the Asia Pacific region, to arrive at an outlook for the job market in 4Q 2016.

They measure hiring outlook using a term known as Net Employment Outlook (NEO), which is the percentage of employers expecting total employment to increase in their organisations, minus the percentage who think total employment will reduce.

Employers have the highest hiring plans in India and Japan, while those China and Singapore have the lowest.

Here is the NEO for various countries, along with a few highlights:


India (+31%) : Slightly weaker hiring plans compared to the previous quarter and year. The largest growth in jobs is expected in the Wholesale/Retail Trade and the Services sectors. India continues to have the strongest job market in the region.

india-jobs-market-4q-2016


Japan (+20%) : The job market in Japan remains tight, especially due to demographics. Most industries report good hiring levels, with Mining and Construction showing the most gains. This could be due to needs of the Olympics in 2020.

japan-jobs-market-4q-2016


China (+5%) : Positive hiring is expected in all sectors and most regions in the country. The strongest growth is expected in the Services industry. Hong Kong (+13%)

china-and-hong-kong-jobs-market-4q-2016


Australia (+12%) : The country is showing signs of a mild rebound in hiring. All industries expect increased hiring levels, with the best outlook for Transportation & Utilities, Services, and Finance.

australia-jobs-market-4q-2016


Singapore (+8%) : Hiring activity is forecast to decline for the seventh quarter in a row and to levels which are the weakest since 2009.

singapore-jobs-market-4q-2016

Best And Most Innovative Universities In Asia (2016)

Two university rankings were released recently, one looking at the best universities overall and the other that ranked universities based on how innovative they are.

Let’s take a look at how Asian universities fared in the rankings.


QS, the educational consultancy based in London, provides a general ranking of universities, based on factors such as:

  • Academic reputation.
  • Employer reputation.
  • Professor to student ratio.
  • Research capabilities and footprint.
  • Professors with PhD degrees.
  • Internationalization.

At a global level, only two universities from Asia ranked in the top 20. National University of Singapore ranked 12th worldwide and Nanyang Technology University came in at 13th place. The next best Asian university was Tsinghua University from China, which is at 24th.

Here are the rankings for the top 10 universities in Asia (criteria is slightly different from the global rankings):

  1. National University of Singapore (NUS)
  2. The University of Hong Kong
  3. Nanyang Technology University (NTU)
  4. The Hong Kong University of Science and Technology
  5. Tsinghua University
  6. KAIST – Korea Advanced Institute of Science & Technology
  7. City University of Hong Kong
  8. The Chinese University of Hong Kong (CUHK)
  9. Peking University
  10. Seoul National University

Reuters also ranked universities in Asia, but focused more on innovation. Their ranking was based on criteria such as:

  • Patent volume.
  • Patent success.
  • Patent citations and impact.
  • Research citations and impact.

Korean and Japanese universities fared well on these factors and they are doing well inventing new technologies and advancing science.

Here are the top 20 most innovative universities in Asia:

  1. KAIST
  2. University of Tokyo
  3. Seoul National University
  4. Osaka University
  5. Pohang University of Science & Technology (POSTECH)
  6. Tohoku University
  7. Kyoto University
  8. Sungkyunkwan University
  9. Yonsei University
  10. Keio University
  11. National University of Singapore
  12. Tokyo Institute of Technology
  13. Tsinghua University
  14. Korea University
  15. Hanyang University
  16. Peking University
  17. Gwangju Institute of Science & Technology
  18. Kyushu University
  19. Nagoya University
  20. Hokkaido University