In Asian financial services, despite slowing regional economic growth, skill shortages are widespread and in some functions candidates are receiving multiple job offers.
According to our research, only one in three Asian financial services firms is prepared to tackle these talent shortages and other critical “people risks” such as inadequate leadership pipelines and high salary inflation.
Talent shortages are a particular problem among millennials because banks are now losing their appeal for young people in the region.
Millennials perceive them as lacking innovation as companies, which in turn makes them less attractive as workplaces. Unlike 10, or even five years ago, more young people in Asia are becoming attracted to working in sectors like technology – and banks are finding it harder to compete for talent.
So what should junior professionals in Asia’s main finance centres, Hong Kong and Singapore, look for in employers that are competing to hire them?
Being “market competitive” (staying on top of current salary levels in the industry) is still critical.
But in 2016 pay is by no means the only criteria that young candidates in Asia will use to select between jobs or between sectors. Gone are the days when 20-something Asian professionals would work long hours to keep their “iron rice bowl” (stable and well paid) jobs.
Research conducted by Universum highlights some traits that differentiate millennials from the older generation. For example, 47% of millennials would leave a financially more favourable position to attain a better work-life balance elsewhere, while just 17% of older workers would do the same.
Millennials are increasingly demanding that banks deliver on both sides of the employment equation – they must provide a package of work-life benefits as well as strong monetary rewards.
While Asian financial services as a whole may lag behind other sectors when it comes to work-life balance, some firms are now trying to get to grips with the issue.
DBS, for example, has implemented a series of flexible working arrangements. One of its initiatives, iFlex@DBS, gives employees a fixed sum of money each year to use for “wellness purposes” – from family vacations to fitness classes.
What emerging trends should young Asian job seekers now look out for when it comes to work-life balance benefits?
We are now starting to see some banks structure benefits packages to reflect the preferences of individual candidates rather than just apply one-size-fits-all policies.
While this involves the bank dedicating more time and energy to its recruitment efforts, it means millennial employees are more likely to see the firm as one they would stay with over the long term.
Aside from pay and work-life balance, what else are banks in Asia doing to try to attract millennial talent in the face of strong competition?
Gen-Y like to be challenged in their careers, rather than having a ‘job for life’ – and this affects the way financial institutions build their talent pipelines. Research suggests that compared to older generations they are more comfortable with change and more willing to job hob in order to gain new experiences that resonate with their career goals.
Mobility is therefore essential to their view of career development. And banks must offer them internal mobility – whether that’s to different jobs, departments or countries – to help retain their Gen-Y employees.
Mentoring, not micro-managing
The traditional command-and-control approach to managing young people in the finance industry is no longer helpful for retention. Instead banks need to invest more in coaching and mentoring.
Moreover, according to a recent PwC study, one of the key ways of attracting Gen-Ys into the finance industry is to design distinct career paths and be upfront with them about development programme opportunities.
Fast track to management themselves
Today’s 20-something finance professionals are aware of and very confident about their career paths. According to research by Ashridge Business School, 41% of Gen-Y professionals believe they will be ready for management roles within two years, while 22% think they will be within just six months of starting work. While these timeframes may be unrealistic, banks that offer a clear potential path to a management role will have an edge over their competitors.
Pathik Gupta is head of McLagan (a business unit of Aon Hewitt) for Southeast Asia, and is focused on the financial services industry. Eunice Ng is a consultant with the performance, reward and talent practice at Aon Hewitt Singapore.
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