The employment outlook in Asia Pacific looks positive according to Morgan McKinley’s data for the first quarter of 2015. Despite mixed economic results (leaning to the negative, in some places) the APAC Employment Monitor data shows no slowdown in hiring. This indicates that the economies of the nations that make up the Asia Pacific region could be changing for the better, following the seasonal dip in the fourth quarter of 2014.
The Q1 2015 Asia Pacific Employment Monitor recorded a 21% year-on-year rise in financial services roles – up from 12,660 vacancies in Q1 2014 to 15,331 in Q1 2015. Quarterly figures also indicate that hiring has significantly increased, with job opportunities up 34% in Q1 2015 compared to the last quarter of 2014 (15,331 compared to 11,427). Meanwhile, the number of professionals looking for new career opportunities showed an increase of 18% from 25,589 in Q4 2014 to 30,173 in Q1 2015.
“As many organisations moved into a new financial year and released fresh recruitment budgets, we saw the expected uplift in new mandates,” said Richie Holliday, Chief Operating Officer, Morgan McKinley Asia Pacific. “The uplift on a year-on-year basis has also been encouraging.”
“We are seeing some large regional quarter-on-quarter shifts in both vacancies, notably in Tokyo, and professionals seeking new roles, notably in Sydney, but we feel that it is too early to comment on whether these are just short-term anomalies or the start of a trend. We will of course continue to monitor the data closely and report if we see any long-term shifts in the markets where we are active,” commented Holliday.
The Australian economy is looking somewhat lacklustre for 2015; the Westpac-Melbourne leading index, which predicts the direction of the Australian economy for the next six months, slipped into negative territory during Q1. If this continues, there is an increased likelihood of a rate cut by the Reserve Bank later in the year. “Below trend growth through the remainder of 2015 is certainly Westpac’s view…marked by below trend growth in consumer spending; sharp falls in mining investment; and flat business investment outside the mining sector,” said Bill Evans, Chief Economist of Westpac.
RBS has been looking to shut down or sell its corporate banking division in Asia. Now it appears that ANZ may be an interested buyer. Because of the uncertainty around RBS’s plans, many of the 2 600 employees have started to look for other employment. With the emergence of ANZ as a buyer it might make sense for employees to remain at RBS.
For professionals seeking new roles across the financial services sector, the new year and new quarter did seem to encourage more movement, and an increase in the number seeking to change company ahead of the usual, seasonal variations.
“The market for contractors is looking decidedly positive having taken a significant upturn since Q4 2014” said Holliday. “There are two primary factors supporting the contractor market. Firstly, over the past two years, in order to cut costs, large corporates have managed their teams down in size so that they are now extremely lean. As workloads increase and decrease, the tendency has therefore been to hire a contractor rather than make the long-term investment in a permanent hire.” Secondly, there has been a significant focus on numerous large-scale transformation projects involving contractors. These projects have focused on gaining efficiencies, driving existing revenues and exploring and creating new revenue streams.
The weakening Singapore dollar is hindering the plans of the Singapore government. There are more than 200 000 Singaporeans living abroad, many of them working in the financial sector. Therefore, people returning home represent an important source of talent for the city state.
Returnees are in fact so important that the government has an ongoing programme that incentivises banks in Singapore to hire nationals over expats in order to lure émigrés back home. However, as the Singapore dollar has continued to weaken through Q1, going back home to work is becoming less attractive. Also the weak dollar is good for employees outside of Singapore who are sending money home.
Opportunities in Singapore, however, remain on the rise – and our data points to a growing trend of organisations looking to up-skill and up-grade existing talent pools, as well as some growth (mostly around new product lines and services). Offshoring remains impactful on data and support services roles.
The Japanese economy continued to show signs of sluggishness in Q1 with economic figures coming in on the weak side. According to the Tankan Survey, released by the Central Bank of Japan, manufacturing took a particularly hard knock as demand weakened both domestically and internationally.
There was more positive news from the service sector, which showed good momentum with the highest reading within a year, buoyed by lower oil prices and inbound tourism.
The financial services sector is also showing some strength. “Despite a drop in acceleration for growth across the overall economy, we have seen positiveAnchor increases in year-on-year job numbers. Our Employment Monitor indicates that most of this increase took place in the last quarter.” said Holliday Jobs growth is being fuelled by a demand for investment analysts, wealth managers and regulatory and compliance professionals.
The first quarter of 2015 has posed several difficult challenges for Mainland China. The economy showed signs of continuing contraction as HSBC’s preliminary purchasing managers index (PMI) on China’s manufacturing sector slumped to an 11-month low of 49.2 in March.
As the year got off to a weak start calls for further policy easing became louder. “China needs to engage into more aggressive policy easing” Said Liu Li-Gang, chief economist of Greater China at ANZ Bank. Nevertheless, it should be noted that this is only a slowdown in the rate of growth; the economy is still in positive territory. Industrial output grew by close to 7% at the beginning of the year, a figure that many countries would envy. The Chinese government has however taken steps to spur further growth by easing credit and tax policies on housing.
For financial sector jobs it has not all been negative in China, the internationalisation of the Renminbi has caused a major upswing in banking recruitment as banks attempt to adapt to the changes. There are roles available for experienced banking professionals in newly set up RMB teams. Ian Massey, head of talent acquisition at Standard Chartered said that the most sought after individuals are “seasoned bankers who possess the necessary skills and expertise across areas like transaction banking, corporate finance, credit and lending”.
The hiring market in Hong Kong is facing strong headwinds as employers struggle to find competent mainland talent from the graduate pool. Two factors are at play; firstly many graduates still aspire to a front office role in the finance sector upon graduation, however the growth in jobs – and in salaries – is in middle and back-office.
Compliance in particular is an area in which employers are struggling to fill open roles. The situation for both mainland Chinese and Hong Kong graduates is being exacerbated by what many employers regard as a lack of linguistic ability or cultural fit. Many Hong Kong graduates lack the fluency in both English and Mandarin Chinese which employers are looking for, and many junior positions require an attitude or acceptance of a working culture that many graduates are not prepared to accept.
The regulators in Hong Kong are aware of the skills gap issue and have begun taking action. Citing a specific shortage in the insurance and wealth management sector, John Tsang Chun-Wah, the Hong Kong financial secretary, outlined steps that the government would undertake to promote the financial industry to students. One concrete measure is an allocation of $100 million to a three-year pilot scheme to assist the insurance and wealth management sectors.
Despite an economic slowdown across the region in the last quarter of 2014, the first quarter of 2015 showed many positive traits. The market for candidates continued to grow, which indicates that firms are looking towards the future and are willing to invest in talent.