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So, we mentioned that a lot of people are leaving Hong Kong. This outflow stream has been, well, flowing since the pandemic started, but it’s really picked up recently. The population declined 1.2% year over year to 7.39 million in mid-2021. But last week, nearly 23,000 people left, which is 4.4% higher than the previous week.
Now, just to clarify, this isn’t to say that these people won’t come back … They’ll just have to fly from a country that isn’t on the flight ban list and quarantine in a hotel without open windows for a few weeks.
Hong Kong has always had a slight talent shortage, but the pandemic has exacerbated the crunch. JP Morgan, for example, lost one of its most senior APAC equities bankers, Ryan Holsheimer, in late February, and people are saying it’s because of Hong Kong’s COVID rules. The bank has apparently lost 20 managing director-level people in the city in the past year.
“The attraction and retention of talent will therefore be a major priority for banks," said Paul McSheaffrey, partner for KPMG’s Financial Services in China.
So, in terms of what companies are doing to hire and retain talent since last year, some of the biggest banking names have been offering US$5,000 to pay for the hotel fees of people flying back to Hong Kong and having to quarantine.
Companies are also moving talent to Singapore – a major one being Bank of America.
Tara Joseph, president of the American Chamber of Commerce in Hong Kong, said, “Many in the industry also expect that eventually many jobs in the sector will be taken up by mainland Chinese talent, leading to a big talent shift."
Some are saying this situation is temporary, and Hong Kong Banking Association chairperson Mary Huen Wai-yi said that, in the interim, members of the association (over 150 banks) are looking at stopgap solutions, including upskilling existing staff.
But in the situation that it’s not temporary, the cost of hiring expatriate employees is likely to increase significantly, said an Oxford Metrica report.