Salaries in the tech sector in Singapore is projected to grow at 4 percent in 2017, and banking is expected to fall behind at 3 percent, according to the 2016 Asia Pacific Salary Budget Planning Report by Willis Towers Watson.
This trend is reflected all across Asia Pacific as well, with salaries for the banking sector projected to grow by 4.8 percent in 2017, the second lowest rate of salary growth among industrial sectors in the survey. The survey received responses from 4,000 respondents across industries and job grades.
Business in all its forms is becoming more data- and technology-driven, and banking is no exception – increasingly it’s a fusion of finance and technology. In the competition for talent, it is technology rather than finance that increasingly holds sway. That’s where the shortage lies – the pressure point that’s holding tech salaries steady while others slide.
“The data, allied with what we’re hearing on-the-ground, shows that as traditional banks move services online in the hope of staying competitive, by better meeting customers’ evolving demands via digital transformation, they are competing for the same pool of skills as the traditional high-tech sector,” says Sambhav Rakyan, Data Services Practice Leader, Asia Pacific, Willis Towers Watson.
As businesses become more data and technology driven, the competition for talent in technology comes at the forefront to maintain salaries in tech, while other sectors show a decline. “What the data is telling us is that, amid a general slowdown in the banking sector and more broadly across the financial services sector, salaries for digital roles within the financial sector are holding steady,” Sambhav adds.
Tech talent would necessarily get more in monetary sense but also does in percentage terms. Technology firms are increasingly attracting talent at mid and senior level positions due to less regulation, entrepreneurial work environments, and competitive and innovative total reward packages. Among top-tier university graduates, banking has also fallen out as an industry of choice.
“There is continued attraction and retention pressure from non-financial services firms, such as those in high tech or fintech, as the pay premium in financial services has decreased to where it is no longer a major attraction,” says Greg Kuczaj, Asia Pacific Head, Global Financial Services practice, Willis Towers Watson.
In the age of digital disruption, there lies a need to review and redefine talent strategy to identify key skills and compensation differentiation for talent in key roles. “To truly compete, financial services firms will need to think beyond merely using pay to attract and retain talent. Career opportunities, organisational reputation, security and manager/leadership effectiveness are all critical drivers of attraction and retention.”
Banking salaries in the financial hubs of China, Hong Kong and Singapore are projected to grow by 6.3 percent, 3.6 percent and 3 percent respectively in 2017, well below the expected high-tech salary growth rates of 7.5 percent for China and 4 percent for both Hong Kong and Singapore.
Demand for tech and digital talent is evident elsewhere in the region across many industries. As banks move online and adopt mobile solutions, insurance companies are also adopting wearable devices and data analytics technology to tailor policies, pushing Insurtech salaries higher. Other areas competing for digital talent include Fintech, online-to-offline (O2O) and e-commerce.
The industry feedback further points to a shortage of tech talent in the financial sector, which is helping salary budgets for talent in digital roles hold steady amid broader weakness across other industries, particularly the banking sector.
“In China, Beijing has been pushing entrepreneurship as a cornerstone of its economic restructuring. Digitalisation plays a significant role in this as a key element of an effective entrepreneurship ecosystem,” said Mr. Kuczaj. “It’s similar in India with the government-backed ‘Made-in-India’ campaign. India is also home to a huge e-commerce and taxi-hailing market, creating very high demand for talent in mobile payment technology and data analytics.”