Employers engaged in an unsustainable bidding war on salary

More than nine in 10 employers in Asia are facing difficulties recruiting and retaining talent. An inability to match candidates’ salary expectations is one of the top reason firms in the region are struggling to fill roles.

According to the Hong Kong Institute of HR Management and Chartered Institute of Personnel and Development’s (CIPD’s) survey, Talent resourcing and retention in Asia, despite the increasing challenges associated with recruitment and retention, and 48% of organisations expecting to need to increase staff levels in the next 12 months, resourcing budgets in Asia remain flat.

When it comes to retention strategies, which nine in 10 organisations have in place, the survey found that increased pay and benefits topped the list of activities Asian employers are engaging in. Less than a third, however, cited that they use learning and development opportunities as a way to keep staff engaged and build internal talent pipelines to support future growth.

Also, while recruitment and retention difficulties were common across all six countries in the survey, some challenges were more pronounced in certain countries than in others. For example, recruitment difficulties are most acute in China and Hong Kong, and organisations in China, Malaysia and South Korea are most likely to predict an increase in funding for resourcing over the next 12 months.

Claire McCartney, Research Advisor at the CIPD, said: “As Asia continues to experience growth despite the global slowdown, it’s perhaps not surprising to learn that employers in the region are engaged in a war for the best talent to fuel their growth.”

“However, it’s important to avoid getting into an unsustainable bidding war on salaries. Instead, employers should get better at communicating a broader package of incentives to prospective employees – including, for example, the learning and development opportunities they can offer,” she added. “It’s also important for firms to develop stronger employer brands around a sense of meaning and shared purpose.”