Salary rises for finance professionals moving between banks in Asia are plummeting – and in some cases disappearing altogether – as more unemployed candidates enter the job market, say recruiters.
In recent weeks and months Standard Chartered, Barclays, Deutsche Bank and RBS have all announced redundancies in Singapore and Hong Kong. As a result, job seekers in the two cities aren’t receiving the high pay rises banks were offering towards the start of the year when they had fewer candidates to choose from.
“As little as six months ago most mid to senior-level finance professionals could expect a minimum 15% pay increase without much scrutiny, with 20% possible with a little negotiation,” says Adam Solomons, an associate director at recruiters Hydrogen in Singapore. “But from Q4 and going into 2016 we’re seeing as low as 8% to12%, despite candidates having to walk away from 2015 bonuses if they leave this quarter. Employers know there are good people who can be hired at a reduced cost and that’s driving down salary rises.”
Gary Lai, managing director of Southeast Asia at recruiters Charterhouse Partnership, agrees: “A year ago banks in Asia offered up to about 18%, but now it’s more like 8% to 12%. Banks are now significantly less likely to break their internal pay banding or find alternative ways of increasing pay such as guaranteed bonuses, even if that means losing the perfect candidate.”
A 10% pay increment is the new norm in Asia, says Kyle Blockley, managing partner of recruitment firm KS Consulting in Singapore. “If you’re already in a stable role and the offer is less than 10% then think twice about moving,” he advises.
However, if you’re unemployed or trying to exit a firm that’s cutting jobs, even 10% may be unobtainable. “For the growing pool of candidates working in a bank where there are a lot of uncertainties, it’s now common to accept a smaller increment, or even a pay cut, from a new employer,” says Lai.
Standard Chartered staffers appear most vulnerable to salary cuts when they change jobs. As we’ve already reported, the bank has been among Asia’s most generous payers for several years. “People from SCB will struggle to find work elsewhere on the same comp because of the way their packages were structured – a high basic salary plus a target bonus,” says a recruiter who asked to remain anonymous because of client confidentiality.
Don’t expect banks in Singapore and Hong Kong to offer you much room for negotiate your salary in the current market. “One of the things I’ve noticed in recent months is much more pragmatism around salary offers,” says Ben Batten, country general manager at recruiters Volt in Singapore. “Rather than going back and forth, many banks are making their best and final offer first time around.”
In Singapore redundancies aren’t the only factor helping to keep pay rises on the low side. Lai from Charterhouse says: “Singapore is one of the costliest centres in the world for banks to operate in and without a continuous growth in productivity, there’s a limit to how much salaries can keep on increasing.”
“Additionally banks in Singapore are looking to hire locally where possible,” adds Blockley from KS Consulting. “They’re now not so willing to spend on bringing in overpriced expats.”