Predictably, the global financial crisis is having a knock-on effect in many areas including the recruitment market.
Until only recently, employers in Hong Kong were having a tough time sourcing the best people to fill all of their job vacancies. "The number of new vacancies plummeted and it has yet to hit rock bottom," observes Edmond So, general manager, Besteam Personnel Consultancy Limited. "Given the widespread damage from the current financial crisis, jobseekers in the manufacturing and trading fields will be next to feel the pinch as the shrinking consumer markets in the US and Europe start to impact growth of those industries."
Besteam has observed a freeze on headcounts for the third quarter, with companies limited to hiring replacement staff rather than inviting applicants for new positions. In a similar trend, the company forecasts a significant drop in the number of jobs available in the last quarter of this fiscal year, as manufacturers continue to adopt a cautious hiring approach.
With factories in China downsizing their operations, Mr So predicts the unemployment rate will rise dramatically. Increasing raw material prices and the strengthening of the Renminbi will amplify the problem, he notes. "During the good times, employers don't hesitate to add new positions because they need sufficient manpower to meet their orders. However, with fewer orders during the current situation, companies may have to hold their headcounts or lay off excess staff. In the worst case scenario, some of these manufacturers may need to close down their businesses," Mr So says.
To ride out such a taxing situation, companies need to take immediate action to increase business opportunities while minimising operational expenses.
"Manufacturers who used to count on exporting goods may start to explore any untapped potential in the domestic market. Some may need to shift their business model from purely factory operations to building their own brands in wholesale or as retailers," Mr So says.
He notes that some production lines might even migrate to places with cheaper labour costs, such as South East Asia.
"The supply and demand in the labour market has gone from one extreme to another. Until earlier this year, companies were still facing high turnover rates and difficulties meeting headcount targets. They needed to spend significant resources on salaries and benefits in order to retain talent," Mr So recollects.
As hiring slows and the number of permanent positions decreases in the coming months, more recruitment will focus on contract staff and temporary positions, which offer vital flexibility to businesses as they look to endure an economic downturn.
With a bigger pool of talent available, recruiters have more choices and can better allocate the right people. However, they may have less tolerance for unsatisfactory staff performance, Mr So points out.
As such, individuals should maximise their competitiveness and competencies by attaining useful work-related qualifications, undergoing continuous learning and improving their basic language proficiency.
Meanwhile, employees should pay attention to their working attitude. Punctuality, engagement and loyalty are the most essential attributes an employer looks for.
"For people who have taken advantage of the robust economy before, it is time to get back on the right track. People with appropriate aptitude and a good attitude just need to stay alert to the overall economic atmosphere and adapt to the transformation. Despite an unclear business outlook, talent remains an important asset for all businesses," Mr So concludes.