A recovery for business
Hong Kong has sustained more than 7% of real GDP growth since the first quarter of 2021, with momentum continuing into the third quarter with an estimated 6.9% growth. Despite the pandemic and uncertainty of COVID, businesses have gradually adapted to ‘the unknown’. Travel restrictions are still in place between Hong Kong and other countries and are not expected to be lifted any time soon. A government consumption voucher scheme boosted local retail consumption by 10.5% in August, with hopes that this will continue through to the end of the year.
Recovery also reflected in hiring activity
The job market also continues to improve, with the unemployment rate expected to drop to 4.3% in Q4 from 4.6% in Q3. Although we saw a relatively slight increase in the number of job vacancies—by about 8%—there was a burst of active hiring, with placements increasing by more than 70% in the third quarter. This has been especially true for roles in compliance, private and corporate banking, from junior to senior-level positions across the board.
The digital sector is, of course, quite active, with companies pushing ever more forward in their adoption of digital business models and day-to-day operations. This activity has a broad reach across all sectors, including banking, consumer goods, food and beverage. Data scientists and professionals with more than ten years of experience who can also drive business growth remain the holy grail, as the discipline is only about that many years old. Increments of 10-20% for those without backgrounds in digital are not unseen. For those with backgrounds in digital, companies are willing to pay an even more premium of up to 25%, making the competition exceptionally tight for this talent.
An additional factor in hiring activity is due to the wave of emigration of families from Hong Kong to other countries; we have observed more replacement roles coming from such movement this year compared to 2020. One client revealed as much as two-fifths of professionals leaving their posts in Hong Kong was due to relocation as they consulted with us for replacement of those professionals. Overall, hiring in the third quarter of this year is relatively active compared to the same quarter in 2020. The market will typically slow down in Q4, but we expect that the market will become even more active after the bonus season in the first quarter of next year. As the market recovers, we expect to see clients gradually have more appetite for speculative hires in their key growth areas of business.
Is a perception of uncertainty affecting hiring?
Under the tensions of the geopolitical environment since 2019, there has been a constant debate in the market regarding Hong Kong’s integration with the mainland and how this affects business plans for various MNCs operating in Hong Kong. However, the chatter about companies moving out of Hong Kong has proven moot, as all major companies have remained in place, with hiring activity steady compared to Q2. There have been no large-scale withdrawals of business, and in fact, many MNC businesses have reaffirmed their commitment to Hong Kong and China as a market focus.
On the candidate side, Hong Kong remains one of the more liberal countries in Asia concerning the granting of work visas. However, some candidates are sceptical about the prospect of working in Hong Kong due to a rising cost of living and uncertainty where safety and stability are concerned. Whereas Hong Kong was once an ‘easy sell’ prior to 2019, that is not necessarily the case now.
There is not likely a one-size-fits-all equation to rectify these misperceptions—however, should you be experiencing these challenges, feel free to reach out for a confidential discussion on how to manage them and continue to attract key talent for your business.