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Pay rises for banking and financial services staff in Hong Kong averaged just 3% last year (ended March 2011), which is more or less in line with inflation during the period. The average pay hike in 2010 was more than twice as high at 7%, according to recruitment firm Astbury Marsden.
The firm’s data shows that in 2011 the average annual salary (excluding bonus) for all staff working in banking and financial services rose to HK$218,000 ($28,000), up from more than HK$212,000 in 2010. In 2009, the average annual salary was HK$198,000.
Senior investment banking staff in Hong Kong are likely to earn upwards of HK$2 million, but Astbury Marsden’s analysis comprises all financial services sectors and includes, for example, support staff working within retail banking.
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“In 2009 and 2010 pay rises for banking staff in Hong Kong and Southeast Asia were ubiquitous, but this has tempered recently as the effects of the eurozone and US debt crises have started to drag down investment banking activity across the global economy,” said Mark O’Reilly, Asia-Pacific managing director of Astbury Marsden. “The long term outlook for the banking sector in Hong Kong is still solid but some of the froth has definitely been taken out of the recruitment market.”
The cautious mood reflects concerns in Hong Kong about the effect of a global recession on Asian markets, as well as the increasingly difficult environment in Hong Kong itself, where low interest rates imported from the US are making it difficult for banks to earn an honest living. As such, most banks in town are reluctant to get into a bidding war for talent.
“The Hang Seng Index is down 23% since the start of the year and the Shanghai index has also fallen in recent months,” said O’Reilly. “That kind of correction feeds through to staffing requirements relatively quickly. Candidates will need to moderate their pay expectations. While a year or two ago those looking to switch jobs may have expected a 20% or 25% pay rise between firms, they are now probably going to face average offers of salary increases of between 10% or 15%.”
