Known for its position as a major trading city and home to one of the 10 busiest ports in the world, Hong Kong SAR is poised to play an integral role in the global supply chain network. Furthermore, being strategically located next to manufacturing hubs with world-class transport infrastructure has allowed the city to further establish itself as a logistics hub.
However, COVID-19 and local political unrest have resulted in major disruptions across supply chains. Manufacturing and supply chain companies have mounting concerns over depleting stock and idling stock, or the inability to meet contractual obligations.
As the virus outbreak continues relentlessly, businesses have experienced tremendous difficulties recovering and resuming volume. Trade deals have been negatively impacted, and new regulations have made it harder for companies to conduct global operations seamlessly. Furthermore, safe distancing and workforce measures have severely limited the company’s capacity to produce and deliver, and businesses are finding themselves unable to fulfil orders on time or at all.
While most companies take a wait-and-see approach to the economic environment, we’ve observed some spikes in certain verticals within the manufacturing and supply chain sectors.
a rise in the e-commerce landscape
Before COVID-19, customer convenience and experience drove companies to digitise. More and more businesses are wanting to expand their digital footprint to achieve the highest efficiency levels and extend their reach. Adding that to the rising complexities of a multi-nation supply chain meant that supply chains firms would have to start driving digital transformation in their organisations.
With the pandemic, staying home and remote working arrangements have resulted in businesses pivoting to e-commerce to sustain operations. The country has also observed an increase in digital transactions, where e-payment provider Octopus Cards has seen transaction volume and value in January and February increased by 20% and 30% respectively.
As the number of Hong Kong SAR consumers purchasing from online channels continues to increase, supply chains will have to step up efforts to meet customer demands. Not only does the buying experience have to be fast and seamless, but customers are also expecting a direct factory-to-home process which would promise them the best and lowest price.
For businesses to efficiently and effectively meet consumer demands, we’ve observed regional offices ramping up their digital infrastructure. Companies are incorporating big data to modernise their supply chains and improve the quality of services. The use of digitisation has allowed more businesses to better anticipate consumer demand peaks and troughs and enable them to better align their production and logistics to meet demands. Businesses can also use these trend analytics to automate orders and pin them against their real-time stock, preventing overstocking and resulting in higher fulfilment levels.
growth still observed in specialised, high-demand manufacturing & supply chain sectors
Needless to say, many employers have reduced their headcount budget or froze hiring activities due to the declining and uncertain market conditions. This is especially so for general manufacturing sectors, which currently see a large pool of candidates but a lack of job opportunities.
This situation is further exacerbated by candidates who are no longer open to relocating for a job. Similarly, candidates who were once working in manufacturing plants in Mainland China are also returning home to Hong Kong SAR. People are choosing to remain in the region or move back home to be closer to their family, and to seek safe haven during a pandemic.
With a greater number of unemployed people compared to job vacancies in Hong Kong SAR, job seekers are seen to be revising their expectations when looking for a job this year.
The manufacturing and supply chain sector is a particularly large driver of the Hong Kong SAR economy. And even as firms are forced to reduce business activities due to the lack of demand, most employers are focussed on maintaining the business rather than hiring to expand.
We have observed variations of talent demands within the manufacturing space as well. While some have decided to freeze hiring or are temporarily closing functions, others are hiring talent either for replacement roles or to meet an unexpected increase in the number of orders to fulfil.
Actual product management is one such sector that is hiring. Although there are job seekers in this field looking for jobs, most tend to prefer opportunities that cover multiple markets in the region and offer a higher level of job security. Companies that are financially stable and can offer good healthcare benefits and interesting job content will be particularly attractive to job seekers.
expectations of skills and salary, revisited
Niche markets such as the semiconductor industry or factory managerial positions require a specific level of technical capabilities, such as working with battery packs or ventilators. Due to the technical nature of the job, it is not easy for professionals to switch between sectors without taking a significant pay cut or change their job titles to a less attractive one. Organisations will still prefer to hire candidates with relevant product knowledge and experience, as opposed to job seekers with a background in another manufacturing vertical.
Besides specialisations and technical skills, employers are also looking for candidates who are fluent in business Mandarin to effectively communicate with their Chinese counterparts. This is because while there are supply chain and warehousing facilities in Hong Kong SAR, most of the major manufacturers are still based in mainland China.
Employers are also more conservative about offering attractive salary and benefits to highly qualified candidates as compared to previous years. If the candidate operates in a highly competitive and high demand space, they can still expect up to 20% increase in salary if they switch employers. However, given the current market conditions, it would not be uncommon for the unemployed to take a pay cut in exchange for a permanent role to sustain their cost of living.
If finding high performing leaders and talent remains a key challenge for you, contact us to find out more about our specialist talent recruitment and management services in the manufacturing and supply chain sector.
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