It’s been an “employee’s market” — a third of Asia-Pacific’s companies have supplied larger salaries to draw expertise, in response to Mercer. But the tables may be turning as fears of recession develop, mentioned the consulting agency.
“Companies are beginning to get cautious, particularly [in] the second half of the yr,” mentioned Puneet Swani, Mercer’s profession enterprise chief for Asia, Middle East and Africa.
He informed CNBC’s “Squawk Box Asia” on Thursday that one in 5 corporations in Asia-Pacific have issued hiring freezes, with 40% hiring for simply essential roles.
“There’s one other 30% of organizations that are saying that the hiring selections require one other layer of approval,” Swani mentioned.
“With all of the fears of recession … the tide would possibly flip [for employees].”
However, corporations are nonetheless dealing with talent shortages. According to Mercer’s international survey in July, 70% of 181 companies in Asia-Pacific have been struggling to draw expertise, particularly these in Japan and China.
That has pushed corporations to get “artistic” in expertise attraction, mentioned Swani, by way of enticing salaries to counter higher costs of living and inflation.
Mercer discovered that wage raises for 2022 are larger than 2021 throughout all industries and markets in the area, with some even above pre-pandemic ranges.
To retain expertise, 42% of corporations are additionally offering retention bonuses, up from 31% in 2019, mentioned Mercer.
Tackling worker disengagement
However, competing for expertise on compensation alone will not be sustainable, mentioned Swani.
“Organizations might want to have a look at this as a marathon fairly than a dash … [and] have a look at the broader worker expertise.”
He added, “If you have a look at the highest three drivers of disengagement in employees, a part of it’s the capability to work flexibly remote or hybrid.”
Training opportunities are one other approach for corporations to distinguish themselves from the competitors.
“[That’s] been a very robust agenda, particularly as corporations got here out of the pandemic, their enterprise fashions have modified,” he mentioned.
Swani added that corporations have increased automation and outsourcing, resulting in ability gaps inside organizations.
“That’s [on] staff minds as nicely, how do you assist me upskill and reskill?”
In another study, Mercer discovered that 95% of staff in Asia reported not too long ago selecting up a ability. Despite that, the research mentioned, 97% of corporations reported vital ability gaps in their group.
Increased mobility
For international locations that rely a lot extra on international expertise, increased mobility as pandemic restrictions ease will assist to handle expertise shortages, mentioned Swani.
“For these international locations, the entire provide and demand dynamics actually modified [during the pandemic], and which triggered a lot of salaries shifting upwards as nicely as a result of you’ve very restricted expertise.”
He added, “A lot of countries are open … and enterprise visas are being [issued]. And I believe that is going to assist handle a few of these expertise demand shortages from that perspective.”