"Prepare for the Upturn" (PPT)

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Prepare for the Upturn逆境自強 迎接挑戰

Employment in HK: Issues and Policy ImplicationsCentral Policy Unit Public Seminar

Speaker ： Ms Virginia Choi, President, HKIHRM

Date: 25 November 2002

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Agenda

What is HKIHRM?What is HKIHRM?

What is going on in the market?What is going on in the market?

What does that mean to me?What does that mean to me?

What is the job market environment?What is the job market environment? - Take aways for employers and employees- Take aways for employers and employees

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What is HKIHRM?

• A non-profit and non-government A non-profit and non-government professional organization formed in 1977professional organization formed in 1977

• With more than 3,400 members With more than 3,400 members (including 320 corporate members)(including 320 corporate members)

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Economic Economic & &

Employment Employment EnvironmentEnvironment

What is Going on in the Market?

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Macro Economic Environment

1) 1) Uncertain economic outlookUncertain economic outlook• US may experience economic

downturn2) Globalization2) Globalization

• Shortened business cycle3) China 3) China

• Continues to enjoy high GDP growth4) Knowledge economy4) Knowledge economy

• Human capital is the most important assetHK: Prudent but not pessimistic

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The Downward Spiral Massive

Change

DemoralisedWorkforce

Disconnectionfrom Customers

CostCutting/ResourceStretching

Internal focus

Lack ofCapacity to GrowMore Cost Cutting

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HK Employment Market1)1) Unemployment rate still remains Unemployment rate still remains

highhigh

2)2) Manpower mismatchManpower mismatch

3)3) Changing employment patternChanging employment pattern

4)4) OutsourcingOutsourcing

5)5) Flexible work arrangementFlexible work arrangement

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What does that Mean to Me?

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Transformation Requires a Leap

Can’t transact your way to transformation

Must think from the goal back

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(A) Skill Sets for the Workplace(A) Skill Sets for the Workplace

What is the Job Market Environment?

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Top 5 most Important Training Initiatives to Various Levels of Staff

Frontline Staff Supervisors Middle Management Senior Managers

1English Language Comprehension

Supervisory Management

Effective Problem Solving Skills

Strategic Planning

2General Computer

Skills Effective Problem

Solving Skills Presentation Skills

Change Management

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Basic Interpersonal

Skills for Associates

English Language Comprehension

General Management

Skills

Risk / Crisis Management

4Putonghua Compreh

ension

Basic Interpersonal

Skills for Associates

Resolving conflict / negotiation skills

Organization Development

5Effective Problem

Solving Skills Managing Priority

Project Management

Resolving conflict / negotiation skills

Source: Training Needs Analysis Survey 2002, IHRM

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Personal Quality being Measured in Appraisals

0% 10% 20% 30% 40% 50% 60%

Senior managers/ directors

Managers

Non-managerial staff

Industrial staff

Core competence Future potentialEmploy ee’s career w ishes/ aspirationsSpecific competencies for each job Functional competency applicable to specific business/ functional units Selection of traits or skills

Source: IHRM Incentive Policy and Performance Management Survey 2002

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Take Aways:1)1) For employees:For employees:

• Invest in themselvesInvest in themselves- - New workplace skills are needed, e.g.New workplace skills are needed, e.g.• Conflict-resolving / negotiation skills• Managing priority• Language skills: English and Putonghua- Personal quality being measured- Personal quality being measured• Core competency, future potential

2)2) For employers:For employers: • Invest in their people• Talent management

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(B) Change of Employment Mode(B) Change of Employment Mode

What is the Job Market Environment?

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Manpower Planning

1.1. Proportion of flexi workforce to total Proportion of flexi workforce to total workforce increases:workforce increases:

- 2001: 9.1% 2002: 11.9%

2.2. Proportion of companies with Proportion of companies with outsourced positions increases:outsourced positions increases:

- 2001: 22.6% 2002: 24.2%

Source: IHRM Manpower Planning Survey 2002

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Take Aways:1)1) For Employees:For Employees:

• Try to understand the global trends of outsourcing and flexi work arrangement

• Ensure your own employability• Keep an open and flexible mind-set to the

changing working environment

2)2) For Employers:For Employers:• Need professional management on flexi

workforce - e.g. how to motivate, how to provide effective training and how to reward

• Manage outsourcing projects professionally - - may lose control and risk fluctuating standards

• Communicate with affected staff

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(C) Change of Compensation & (C) Change of Compensation & Benefit PackageBenefit Package

What is the Job Market Environment?

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Pay Freeze is the Trend

1.1. First negative pay adjustment recorded in 2002 sFirst negative pay adjustment recorded in 2002 since 1984ince 1984

2.2. Overall weighted average adjustment in 2002Overall weighted average adjustment in 2002- 2001: 2.6% 2002: - 0.1%- 63.5% of responded companies opted for pa

y freeze3.3. 2003 predicted adjustment2003 predicted adjustment

- 82% predicted pay freeze

Source: IHRM Pay Trend Survey 2002

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The Use of Flexible Incentive Package

Non-guaranteed bonus paymentNon-guaranteed bonus payment- 89% surveyed companies provided

a non-guaranteed bonus scheme to some or all of their employees (vs. 84% in 2001)

- Among those employees eligible to be awarded a bonus, only 52% were actually awarded a bonus (vs. 88.7% in 2001)

Source: IHRM Pay Trend Survey 2002

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Take Aways:1) For Employees:1) For Employees:

- Incentives will only be awarded to high performers

- Work together with employers to enhance the competitiveness of companies

2) For Employers:2) For Employers:- C&B directly related to business profitability

- A properly designed non-guaranteed scheme to motivate staff performance and to flexi payroll costs

- Open communication, the right corporate culture & effective C&B strategy are key to enable changes with least pain but more understanding

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The Upward Spiral

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Well-Equip yourself,Be a Winner in the

Future!

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URL: http://www.hkihrm.org

Informative Website

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