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With Hong Kong's corporate sector convinced that the worst of the hard times have passed, the business community is making a dedicated effort toward holding on to key talent, according to a study released yesterday by Hewitt Associates, a leading global human resources consulting and outsourcing firm.
Holding on to their best people was cited by 90 percent of companies surveyed as a key element of planning for 2010,[link widoczny dla zalogowanych], according to the survey.
There's been a significant drop in staff turnover in 2009, down from 17.7 percent last year to 14.0 percent this year. Among workers who chose to leave their employment, 81 percent cited better opportunities elsewhere.
Thus top performers among corporate employees proved to be beneficiaries of the economic crisis, according to the research. Some companies nearly doubled salaries of employees considered crucial to the success of the organization. Data showed although the senior management level in Hong Kong experienced a slight drop in variable pay,[link widoczny dla zalogowanych], top management earned much more than in the previous year.
"While the balance of power is still heavily in favor of the employer,[link widoczny dla zalogowanych], it is important to remember that key talent is always under threat. Organizations are recognizing the value of these key employees and are taking steps to ensure that they are appropriately catered for," said Mary Yu, senior consultant at Hewitt Associates in Hong Kong.
Around half of the 220 companies that took part in the survey reported that the average annual salary increase in 2009 was 1.4 percent, down sharply from the 5.2 percent in 2008. Salary increases for 2010 meanwhile are expected to average 2.9 percent.
The pharmaceutical and medical devices industry enjoyed the highest percentage salary increase at 2.9 percent. The retail, transportation and electronics sectors barely managed 1 percent increases because of the global economic crisis.
Tzeitel Fernandes, head of Hewitt's Compensation and Benefits Consulting Practice in Hong Kong,[link widoczny dla zalogowanych], said increasing awareness of the need for health care contributed to the strong performance of the pharmaceuticals industry. The outbreak of swine flu earlier this year prompted many people to spend more money on preventive measures.
Yu said the market outlook for 2010 is more positive. Only 15 percent of the responding organizations anticipated adopting pay freezes next year. As sentiment toward the economy remains cautious,[link widoczny dla zalogowanych], the majority of the responding companies were still unsure about their planned bonus figures next year, as well as salary increases.
Research does reveal employers are placing more emphasis on identifying and rewarding employee performance next year. Non-monetary rewards like learning or development incentives are also expected to be heightened.
The research conducted by Hewitt Associates showed that in 2009, the average salary in the Chinese mainland went up 4.5 percent overall. That compares to the corresponding 10.3 percent average increase for 2008. The projection for 2010 that salary increases will bounce back to about 6.7 percent as economy continues to recover.