It’s been quite a shock for some, but Asia is no longer impervious to the large-scale financial job cuts that have hit the West. HSBC announced this week that it will axe up to 3,000 jobs in Hong Kong by 2013. These redundancies are mostly in support roles, including banking technology, human resources and administration. The bank employs about 23,000 employees in Hong Kong.
One recruiter, who declined to be named, says although the magnitude of the cuts was a little surprising, they were not unexpected. “When HSBC first announced global cuts earlier, they didn’t distinctively rule out job losses in Hong Kong.”
The candidate impact
What does this augur for Hong Kong firms and candidates? Our anonymous recruiter foresees that candidates may become increasingly reluctant to switch jobs given the market uncertainty. He says: “Usually announcements about layoffs tend to make candidates nervous. They may think it’s better to sit tight where they are now than to move.”
The copycat effect?
Another recruiter, Neil Blondell, regional director, PSD, Hong Kong, says it is possible that other firms in Hong Kong may follow HSBC’s lead, however, he doesn’t think the layoffs will be as large. The sentiment that Asia is safe while the West takes the hits, has been thoroughly shaken, say recruiters.
Blondell says: “Nowhere will be completely safe or immune as the global economy is so connected and interlinked now. However, I think that in general Asia is likely to suffer a lot less from the cuts in banking than North America or Europe.”
Is Singapore next?
Whether or not HSBC will make cuts in Singapore remains to be seen. The bank had earlier said it would hire at least 2,000 people in China and Singapore over the next five years, with the emphasis on trade, wealth management and financial markets. As recently as last month a Straits Times article had the headline: “HSBC hiring, not axing, staff in Singapore.”
Will the job losses in Hong Kong mean other firms in Singapore will follow suit? Mark Sparrow, head of professional and technical, APAC, Kelly Services (Singapore), says it’s a possibility given how all firms are sharpening their pencils on costs to optimise their returns .
“We haven’t heard of significant redundancies in Singapore so far, but this doesn’t mean that Singapore will fall outside scrutiny . Organisations will be looking at all parts of their set ups – where to invest, where to cut back, so I wouldn’t be surprised if other firms with deep support infrastructure in Singapore or with poorly performing business units look towards rationalising their business.”
There will still be hires
Although such announcements may make candidates a little jittery, Sparrow says even as some firms cut, others will boldly go “candidate shopping” following the Warren Buffett philosophy to be greedy when others are fearful. Firms will continue to hedge their bets on areas of growth and hire strategically. “There are certainly firms waiting to make their move. Just as not every bank will make cuts, not all will stop hiring.”