Interview with Shanghai Liberate Daily News Paper
Recently, Hewitt released assessment report of salary prediction. Next year, salary level of companies in Shanghai will reach the growth rate 7.0% or so. The national trend in salary is the same as that, exceeds 5% of this year. How the salary of domestic finance is going to be next year after surviving from the financial crisis? For more than a year before the crisis to maintain Can the glorious era that keeping double-digit annual growth before the depression reproduce?
The Raises Prediction in Growing Optimism
“According to our survey, salary increase of domestic finance next year will be obviously improved compared to that in this year.” Liao Yiwen, The chief consultant of salary in HuaXinHuiYue China, thinks, “The negative effects of the financial crisis are subsiding gradually. Compared to a few months ago, the raises prediction for next year is more optimistic.”
According to the just-ended 2009 annual salary research of domestic finance, part of the financial enterprises has adopted a policy to freeze pay in the financial crisis. The real growing rate of wages in the whole industry fell to the historical position of 2% to 5%. However, that rate in 2008 was 12% – 15%, falling down 10% this year.
“Although the domestic financial industry is not the same as the shocked U.S. counterparts on Wall Street during the crisis, the economic environment is still poor. So enterprises are quite cautious generally; especially, the foreign financial institutions in local China are limited to rise strictly by the headquarters. Most of them adopted a policy to freeze pay. As a result, the pay growth of the whole Industry has a sharp decline in this year compare to last year. “Liao Yiwen analyzed.
The data of HuaXinHuiYue shows: in 2010, salary growth rate in the domestic banking will recovered to 8%, the fund industry may reach 10%, industry and life insurance industry is relatively low, about 4% ~ 5%. “It can be seen that the fund in the entire financial industry is expected to be more optimistic, recovery rates of banking are relatively high.” Ms.Liao said, “In addition, the situation of securities industry is not bad, too. We haven’t got the lasted data.”
Gao Yue, partner of Antal International, is more optimistic about the expectation of salary growth in domestic finance industry. “From the salary situation reflected by our headhunting business, the salary of target candidates inside industry raised about 10%, and next year will probably picked up to the level of 15%.”
Reservation
“From July or August this year, economic recovery, many organizations inside the industry demand for additional staff at the same time. Foreign institutions, Some of the Foreign Banks have joined into the talents competition as well, which makes the talent shortage getting worse. Either local or foreign financial institutions must take measures to retain talents. Thus, organizations in the industry have to relax their grip on the salary budget next year.” Mr. Gao believes.
In Gao Yue’s opinion, the short supply of talent during the instant development in domestic finance, is the major motivation of payment recovery after the depression subsiding. He said there are two trends of talent demand in the current industry: one is, China’s financial market is still in an expansionary increase, organizations in the industry mainly rely on attracting new customers and selling financial products to develop their business. Therefore, from the junior position to Sales Director of China, the demand of sales position is increasing sharply: The other trend is, some foreign-funded financial institutions are preparing to move their Asia-Pacific operations center into Shanghai or other cities in China, so their demands for back-office operations manager is also growing obviously. Project management, operations center director related positions are on fire.
Liao Yi Min also believes that the “horse racing enclosure” type of rapid expansion in domestic financial industry, cause the “talent plunder” inside the industry. “Be plundered” talent are mainly divided into three types: first, mature business people, such as customer managers, fund managers, can earn profits for the company directly; second is the professional and technical staff in short supply, such as actuaries, risk and compliance management person and financial innovator, especially the risk, compliance management person. They are paying particular attention after the financial crisis; the third, high-end administrator, including talent from overseas and foreign talent. There is a certain demand for them. Those most-wanted talents will have a higher growth of salary than the industry average level.
“Take foreign banks to example, China is their most concerned market, all of them want to develop China business rapidly. So they are willing to increase the investment in personnel performance incentives, our research shows salary increase rate of foreign banks may be about 8% next year. ”
Time Needed to Restore Market Confidence
At the same time of salary changing-rate of whole industry is rising again, there are still many financial institutions haven’t decided to increase salary budgets finally so far. “In the survey of this year, we found that half of the companies do not fill in a column that next year salary expectations. That indicates those firms are still waiting for a further performance of the market.” Liao Yiwen said. Customarily, domestic financial institutions usually adjust their salary police during March to April every year. “When we update the survey data in January next year, the firm’s attitude may be clearer.”
After a big crisis, it is difficult to return to the high-level pay increases for the whole industry in a short term. Liao Yiwen said that before the Asian financial crisis of 1999, the annual salary growth rate of the domestic financial industry is more than 20%. But those rate didn’t go back to 8% ~ 10% until the year that 2 ~ 3 years after the financial crisis. “While we have an optimistic expectation about the pay rise for next year, it is hard to believe that the rate cab achieve the growth level in 2008.”
In the test of the crisis, the competitive landscape of remuneration between the domestic and the foreign financial institutions is changing quietly. Gao Yue found that, the competitiveness of part of the domestic institutions content with foreign institutions in salary, career stability, development platform, etc.,. “For example, there are more than 90 city commercial banks in our country and most of them are developing in a good trend. They preferred to leave their local city and began to spread all over the country. And also, they are sufficient strength and willing to provide a competitive salary to seize talents with foreign banks.” Gao Yue disclosed that, the vice president in city commercial bank branch can get an annual salary rang of RMB800,000 to RMB150 million currently.
