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Hopes and Fears: Hires and Fires in Asia’s Financial Sector


In the aftermath of last year’s economic shock, banks are taking (sometimes cautionary) steps forward in growing their headcounts. Nowhere is this more apparent than in East Asia, where interest rates are much higher than in Europe and the financial services industry has consistently grown in recent years. 

Hong Kong and Singapore: a competition of two giants 

The notable exception to the growth of hiring in the region is Hong Kong. The semi-autonomous city has long been the East’s centre of investment banking, but its uncertain future is beginning to serve as a deterrent for its investment banks.

After employment in the Hong Kong financial sector rose by 2% between 2016 and 2018 (constituting seven percent of the territory’s overall employment) the industry actually saw a shrink in Winter 2019.

This only continued further in Spring 2020 with the height of the pandemic on the Asian continent. Since the Summer hires in finance have risen at only a modest level.  

In contrast, Singapore’s financial sector expanded its personnel by far more last year. In the first half of 2020, financial employment grew by 5.9% compared to 2019, with 1,500 new jobs created.

Interestingly, three out of four jobs were local hires – a move which the realities of COVID-19 travel restrictions may have spurred. Regardless, the local hiring was supported by industry leaders who are committed to helping the local community.

A local workforce is the “single most important ingredient of Singapore’s success as an international financial centre in Asia,” Jacqueline Loh, Deputy Managing Director of the Monetary Authority of Singapore, said in August last year.   

There may be something of a causal relationship in this tale of the two politically-unique cities. Hong Kong is a city in limbo – and it’s precarious political situation (regarding its relationship to China) may be affecting its ability to run as a financial hub.

An investigation by The Financial Times found that there are eight times as many jobs available at JPMorgan and UBS in Singapore as in Hong Kong, and other banks such as Goldman Sachs and Citibank were still advertising twice as many. 

International banks are opting for Singapore whose geopolitical situation remains far more stable than that of Hong Kong’s.

A method in hiring – of steadily decreasing headcounts (rather than shutting offices) is a subtle and non-provocative way of moving banking away from Hong Kong.  

Image: Edwin11

An awakening China

Although Hong Kong’s outlook may be less optimistic, the outlook of China is far better. For decades, China has been using the semi-autonomous city on its southern coast as an avenue for accessing international markets, but this suggests that the burgeoning superpower’s economic infrastructure is now strong enough to stand on its own.

As we reported last week, British-owned bank HSBC seems keen to move jobs from Europe (where interest rates are very low) to Asia, focusing on increasing headcounts in the mainland Chinese cities of Shanghai and Guangzhou. 

Following suit in hiring in mainland China is Japanese bank Nomura. “The only high-quality yield, so safe yield as it were, is really in the Asian economies,” said Nomura’s head of global markets for Asia excluding Japan Rig Karkhanis.

But unlike HSBC, this does not come at the cost of jobs elsewhere: “We are not in headcount reduction mode. Cutting the business can affect our ability to grow other areas,” continued Karkhanis.

Going forwards

It should be of little surprise that Asia will be the epicentre of financial hires this year. In contrast to Europe, the region as a whole was able to mitigate the disruption of the coronavirus pandemic far more effectively – all this in addition to the region’s more fertile economic ground. Banks in Asia seem confident of their ability to grow going forward.

After the year we’ve had, they might be feeling that they can handle anything. 

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