The year of 2019 has been a turbulent one for Asia, from a trade war, to leaderless protests, to the slowdown of traditional powerhouse economies.
According to Links International, the common message for 2020 from business leaders across Asia is that the increased uncertainty means they are continuing to have to transform their HR functions to be flexible enough to adapt in uncertain times while being more cost-effective than ever.
Here are the top 5 findings from the 2020 Asia Salary & Market Insights:
1. Increased investment in HR Transformation projects Attracting and retaining top talent continues to be seen as the X-factor in most organisations' success. As such, HR teams across Asia are continuing to invest in HR transformation projects that are aimed at digitalising and streamlining their HR functions and ultimately improving employee experience. Increasing numbers of HR teams are rolling out global or regional human capital management systems and exploring ways in which robotic process automation and HR technology can be used to automate their administrative tasks and elevate the impact the HR team has in the organisation.
2. Strong IT job market to continue IT projects across Asia continue to see stable investment and as such IT candidates remain in hot demand. While the IT job market is one of the only job markets not significantly affected by the US/China trade war and other economic uncertainty, IT candidates are showing a decreasing appetite to change roles which means companies are having to fight harder to attract IT candidates.
3. HR leaders focused on cost optimisation Recent research shows that 92% of HR leaders are now prioritising budgeting and cost optimisation initiatives in light of the uncertain economic environment. However, the same research shows only 20% of these HR leaders are reported to be considering the impact of these initiatives on the organisation’s overall efforts.
While larger corporations have been decentralising HR in recent years to more specialised functions, some have shifted back to more centralised hubs as a means to gain more control and reduce costs. The rise of start-ups has also increased the demand for HR generalists who can act as a business partner and look after office setup, talent acquisition, compensation and benefits and possess knowledge of the employment ordinance. 4.Senior roles being moved out of Hong Kong To mitigate risks and continue to attract foreign talent, increasing numbers of companies with a regional presence are shifting the headcount for senior roles out of Hong Kong and China and into other business hubs like Singapore. 5. Taiwan and South East Asia win big While the US/China trade war and economic uncertainty significantly impacted traditional powerhouse economies like Singapore, China and Hong Kong, organisations with businesses in countries like Vietnam and Taiwan have been big winners, with increased trade and investment and business growth off the back of the trade war. In addition, some local firms in China are reporting stronger growth from decreased competition as MNC’s in China redirect their investment elsewhere.
Best HR response during uncertain economic times: 1. Cost cutting while keeping long-term goals in sight - Re-examination and prioritisation of current services across functions - Reallocation of current resources - Implementation of dedicated activities to drive immediate cost savings - Build infrastructures that allow for cost savings in the long run (such as AI & automation technology, outsourcing) 2. Honest and open communications to boost loyalty and retention when cost cutting 3. Protect your long-term employer brand when cutting costs