Technology Companies Report Hiring Slowdown in Asia Pacific
Workforce trends data at technology companies across Asia-Pacific reflect a cautious hiring environment in the third quarter of 2019 compared to the prior quarter, according to the Radford Global Technology Survey. Radford is part of the Rewards Solutions practice at Aon plc, a leading global professional services firm providing a broad range of risk, retirement, and health solutions.
In many countries throughout the region aggressive hiring declined, most notably in India, where the demand for technology talent was robust in previous quarters. Despite the dip in hiring, India remains the top market for technology company growth with 12.1% of companies planning aggressive hiring. In Singapore, the percentage of technology companies planning for increased headcount remained steady at 6.0%. On the low end is Taiwan with only 1.9% of companies ramping up hiring. China is experiencing a slight rebound in hiring after last quarter’s slowdown amid an ongoing trade war with the U.S.
As technology companies across Asia-Pacific pull back on hiring, we find that voluntary turnover has decreased in all markets except for India. Voluntary turnover dropped in Singapore from 14.7% to 12.9%. Average voluntary turnover among technology companies in Asia-Pacific is 12.2%; across the globe, it’s 13.3%.
Trend lines often converge between turnover and hiring. When the technology sector is in a slower state of growth, employees are less likely to switch jobs. At the same time, the decrease in turnover can also be attributed to businesses improving retention through more compelling rewards programmes, such as adding equity eligibility further down the organisation or increasing short- or long-term incentive targets for critical job roles and/or high-performing employees.
A final data-point we examine is salary increase budgets. The Radford Global Technology Survey reports that technology companies are planning salary increase budgets for 2020 that are on par with, or slightly higher than, 2019 actual reported spending budgets. Salary increase budgets remain steady in Singapore at 4.0% but are forecasted to be higher in India, Japan, Malaysia, Philippines and South Korea.
As companies put the brakes on aggressive hiring, this is an opportunity for HR leaders to examine their rewards programmes and ensure they resonate with current employees to keep top talent engaged, says Alexander Krasavin, Partner and Head of Technology and Life Sciences for the Asia, Pacific and Middle East regions, in the Rewards Solutions practice at Aon. “The annual merit increase is an important component of a total rewards package, but many employees view this as an entitlement,” Krasavin says. “To make your merit budget go further, consider differentiating merit increases even more and leveraging long-term incentives to reward performance.”