Hong Kong average salary increment accounts for only 1.3% this year
21 May, 2020 14:46
Singularity Financial Hong Kong May 21, 2020
Due to the evolving uncertainty of the current period, it is crucial for both hirers and employees to have different solutions for their prospective job needs within this period of time. Companies are adopting a tighter business operation model whilst job seekers need to consider creative professional alternatives. In March this year, JobsDB commissioned an independent survey organisation to conduct an online survey among 4,000 employees to understand their employment status. The latest Salary Survey report reveals that the overall salary adjustment up to March this year is 1.3%, which is significantly lower than last year’s 5.1%. 50% of respondents have received a raise in salary this year, a 20% drop when compared to last year. Moreover, 40% of respondents reported a salary freeze. Influenced by macro-economic and societal factors, 75% of respondents have negative views on the overall employment outlook for the year and therefore are actively seeking alternative options to improve their position.
76% of job seekers are open to a career change, with employees in the retail and tourism sectors more actively considering a switch.
Commercial activities amongst various industries have been impacted by the recent public health epidemic. Retail and tourism sectors have faced a particularly challenging time, with the global implementation of social distancing and a worldwide travel ban. With a respective pay drop of 8.9% and 8.1% in the retail and tourism sectors, over 30% of respondents across both industries indicated that their salary has been cut. With unclear economic prospects, 76% of job seekers are open to switching job functions, especially for those employees engaged in the hospitality and tourism (26%), customer service (20%) and general management (20%) sectors. The survey also found that 27% of job seekers confirmed they are looking for positions in different sectors; in fact, nearly 20% of respondents said they wanted to change job functions because the prospects in their current industry are getting worse.
Employees classified as being engaged in Information Technology (IT) and Analytics have recorded the highest salary increment, at 6.1% and 5.8% respectively. The IT sector has secured higher-than-average growth for consecutive years, reflecting a consistent demand for strong talent in this rapidly developing industry.
Percentage of monthly salary adjustment in 2020
Mr. Isaac Shao, Chief Executive Officer of JobsDB Hong Kong, said: “Industries related to IT and digital transformation are still booming. This can be attributed to the fact that all industries need technological support and digital transformation to simplify complicated operations and improve efficiency, thereby ushering in a new-generation business model. In addition, Hong Kong is still short of talent specialising in e-commerce, mobile, AI and cloud computing, thus the demand remains very high, contributing to the surging salary growth of relevant industries.”
Most respondents are pessimistic about the local employment outlook
The survey also found that 75% of respondents hold a negative view on the employment outlook in Hong Kong. The key reasons for this include “possibilities of local recession due to socio-economic situations e.g. COVID-19” (78%), “uncertainties around the external environment” (67%) and “foreseeable closedown of local companies” (61%). Furthermore, given employees are generally cautious about the future job market, some employees are considering a change in job function in order to secure a consistent source of revenue: almost 30% of job seekers and employees are willing to “attempt to switch to a company with better job security”, whereas 19% of employees and 32% of job seekers wish to “switch to another job function/ occupation with better job security or greater demand in market”, showing that job seekers are placing an increased importance on job security.
3 to 5 years’ work experience is the best time for changing job function
The softening of the job market has led to 64% of surveyed employees reveal that they took less than 2 months in making the decision to change job function, while 35% took at least 3 months for consideration. This demonstrates that while employees are open to a career change, it remains a decision that requires careful consideration and planning.
73% of respondents with work experience between 3 to 5 years had a higher incidence of salary increase when switching careers (of at least 5%), followed by those with 6 to 10 years of experience (62%).
Considering the cautious economic outlook, 46% of job seekers expect their job hunt will take 3 to 6 months, an increase of 8% compared to last year, versus 31% who expect to find a new job within 2 months.
“Job seekers should avoid solely focusing on salary and benefits,” said Shao, “as their consideration in changing roles should be driven by personal interests and strengths. In order to flexibly cope with any industry crisis, job seekers and employees should make use of their leisure time to acquire new skills or pursue further studies so as to maintain competitiveness in market. Online learning, for instance, is a good opportunity for employees to work and study at the same time. As for employers, they should not just consider candidates’ complete work experience, but also look closely at transferable skills such as analytical ability problem-solving competency and leadership mentality”.
Part time or freelance jobs as a way to safeguard a stable income
The latest local unemployment rate of this year has climbed to 5.2% according to the Census and Statistics Department, set against a relative decline in full-time job offerings. The survey found that 42% of job seekers and 25% of employees are willing to work part time or freelance so as to maintain their income. This result indicates that the part-time/ freelance job market is a flexible solution for both job seekers and employees when full-time job openings have been significantly reduced. Job seekers should also consider applying for part-time jobs, making use of the unique opportunity to explore alternative career paths.
Individuals who seek to undertake and maintain several job roles or different types of work are often known as embarking on “slash careers”. Shao says, “Slash careers are increasingly popular among the younger population, who find career fulfilment through trying new things, and who appreciate flexible working to allow them to pursue further study. During the current epidemic, job seekers may also consider part-time or freelance jobs so as to avoid lengthening their unemployment gap”.