Hiring plans in Hong Kong are the weakest in 10 years, according to the latest ManpowerGroup Employment Outlook Survey.
Overall, companies are delaying hiring, yet the digital skill-set remains in demand.
Hong Kong employers report subdued hiring intentions for the second quarter of 2020. According to new figures released this week, 7% of 440 employers forecast an increase in payrolls, 7% anticipate a decrease and 83% expect no change. This according to the latest ManpowerGroup Employment Outlook Survey. The outlook is the weakest reported in more than 10 years with hiring plans declining considerably in comparison with both the prior-quarters and this time last year, by 10 and 18 percentage points, respectively.
“The seasonally adjusted unemployment rate increased from 3.3% to 3.4%. The labour market slackened further as economic conditions stayed weak. Hong Kong employers expect the weakest hiring pace in 10 years during the April to June period, reporting a cautious employment outlook,” said Lancy Chui, Senior Vice President, ManpowerGroup Greater China.
Employment lowest since 2009 financial crisis
“The Hong Kong employment outlook has slipped into relatively negative territory for the first time since the global financial crisis in 2009. A wide range of industries has been threatened initially by the protests and now by the COVID-19 infection, particularly the consumption, restaurants, retail and tourism-related sectors. The labour market will be subject to even more pressure in the near term.” expresses Ms Chui. She added, “Employers should continue to pursue creative alternatives to downsizing, such as reduced working weeks and pay freezes to hold on to the staff they have to survive in this current economic situation.”
Growing demand for delivery services
The Transportation & Utilities sector’s outlook stands at +6%. Hiring prospects for the sector declined by five and 12 percentage points from 1Q 2020 and 2Q 2019, respectively, and are the weakest reported in seven years. Chui noted, “The daily number of passenger flights has dropped, with more flight cuts expected. Airlines implement special leave scheme that staff have to take unpaid leave in the coming months. However, closure of shops and restaurants brought growth in demand for delivery services as people turn to shop via virtual platforms for daily commodities and food, which has created the urgent hiring needs of logistic companies.”
Services face weakest outlook in 16 years
Services sector employers anticipate a subdued labour market; the outlook is the weakest since the survey began 16 years ago. Job seekers in Finance, Insurance & Real Estate and Wholesale & Retail Trade sector can expect the weakest hiring pace in more than 10 years during the coming quarter. Chui said, “Due to the coronavirus outbreak, visitor arrivals recorded a 53% drop in January 2020. Employers of hotels will be subject to even more pressure, and hiring pace will be slowed in the near term. Many hotels recorded single-digit occupancy and staff are required to take unpaid leave to save the cost. Despite the slowdown in hiring seen by some financial institutions, digital banks are still hiring more staff to deal with inquiries and expanding the teams.” She added, “Faced with dwindling tourist numbers from the Mainland China and high rental costs, retailers are facing challenging times and have implemented various cost-saving measures including salary reductions, shortened store operating hours and hiring freeze.”
Many hotels in Hong Kong have recorded single-digit occupancy during the COVID-19 period
Digital skill-set becoming increasingly important
Chui noted, “Overall, we are seeing corporations are delaying hiring in Hong Kong. However, there are still specific skills in the marketplace that are in certain demand, especially the digital skill-set, which is important in the current environment to prepare for the next downturn. Hiring forecasts from all industries are weaker, confirming that the labour market will continue to contract.”
Though hiring confidence continues to decline, companies still require talent to support their business operations. Chui added, "We still see demand by companies for project, contract or temporary staffing amid market downturn times. Job seekers should be more receptive to job opportunities, and they should use this time to gain experience and prepare themselves for opportunities when the market recovers.
Paul Arkwright
Publisher
