Links Recruitment was recently quoted in an article by Ignites Asia around the effects of the coronavirus. Learn how wages and bonuses of fund companies in Asia are being affected this year.
All around, businesses feel pressured by the economic slowdown as the coronavirus continues to spread. This article comes at a time as businesses re-examine their strategy.
From lowered salaries to full company restructures, businesses are quick to secure their foundations. For a look into the 2020 market outlook, download our 2020 Asia Salary and Market Insights whitepaper.
Here’s a snippet from the article ‘Coronavirus could cause double-digit fall in Asia bonuses‘, quoting Keith Wong our Recruitment Country Director.
As the coronavirus outbreak stretches into the third month of 2020, the diminished economic outlook and potential impact on fund firms’ bottom lines could mean a significant reduction in bonuses and lower salaries in the region, while some firms are already having conversations about job cuts, recruitment experts say.
Keith Wong, Hong Kong-based country director for Hong Kong, Singapore and Shanghai at recruitment firm Links International, says many fund firm clients he is speaking with are expecting their 2020 bonuses to be significantly lower than in 2019.
“I would expect nothing less than a double-digit percentage cut versus 2019,” Wong says, noting that some firms paid up to 12 to 18 months’ salary as a bonus last year.
He explains that fund firm packages are usually performance driven, so any compensation measures will likely be bonus related, rather than a salary freeze.
But if the coronavirus is still negatively impacting fund firm business six to nine months from now, then we might begin to see asset managers making salary-related decisions as well, he adds.
Since the virus outbreak first hit headlines in January, fund firms in the region have experienced major disruptions to their businesses, ranging from product launch postponements in Hong Kong and China, cancellations of industry events and business travel for Singapore fund firms, regulatory process delays due to business continuity plans enacted by regulators, and a region-wide slowdown in hiring across the industry.
Gross domestic product growth in the region is also expected to be weaker than originally expected. Singapore’s Ministry of Trade and Industry downgraded its original 2020 GDP growth forecast from between 0.5% and 2.5% to between minus 0.5% and 1.5% last Monday.
Singapore’s state-owned investment firm Temasek was the first fund firm to introduce salary restraint measures as a result of the virus, announcing last week that it would be freezing wages for all staff starting in April, cutting bonuses for senior management and asking senior staff to take voluntary pay cuts of up to 5% for up to one year.
Read the full article of the effects of coronavirus on fund firms in Hong Kong and Singapore on Ignites Asia.
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