HONG KONG - Salaries in Asia Pacific's banking sector are set to grow by 4.8 per cent in 2017, the second slowest rate of salary growth in the industry, as talent acquisition tilts towards technology rather than finance, a survey has found.
The findings released on Tuesday (Nov 29) by Willis Towers Watson, drawn from its 2016 Asia Pacific Salary Budget Planning Report, show banking salary budget increases for 2017 are set to be well below those in the tech sector, and also below those of the financial services sector as a whole.
"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... they are competing for the same pool of skills as the traditional high-tech sector," said Mr Sambhav Rakyan of Willis Towers Watson.
Business in all its forms is becoming more data- and technology-driven, and the increasing fusion of finance and technology means tech talent holds sway. "That's where the shortage lies - the pressure point that's holding tech salaries steady while others slide," the findings stated.
Eleven of the markets in the region have banking pay increases ranked among the bottom three in cross-industry comparison, it said. Banking salaries in the financial hubs of China, Hong Kong and Singapore are projected to grow by 6.3 per cent, 3.6 per cent and 3 per cent respectively in 2017, well below the expected high-tech salary growth rates of 7.5 per cent for China and 4 per cent for both Hong Kong and Singapore.
""It doesn't mean tech talent will necessarily get more in a monetary sense, but it does in percentage terms," Mr Rakyan said.
Banking no longer stands alone as the industry of choice among top-tier university graduates, according to Mr Greg Kuczaj, Asia Pacific head at Willis Towers Watson. "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."
Even at mid- and senior-level positions, technology firms are increasingly attracting key talent away from the financial services industry due to less regulation and scrutiny in the high tech industry, more innovative and entrepreneurial work environments, and highly competitive total rewards packages.
Demand for tech and digital talent is evident elsewhere in the region across many industries, like insurance companies who are also adopting wearable devices and data analytics technology to tailor policies. Other areas competing for digital talent include Fintech, online-to-offline (O2O) and e-commerce.
Such digital transformation will make it necessary to review and redefine the talent strategy to identify key skills and differentiate compensation in key roles.
"In Silicon Valley, for example, top talent is often rewarded with equity in addition to a competitive base salary and annual bonus. It's very compelling," said Mr Kuczaj. "To truly compete, financial services firms will need to think beyond merely using pay to attract and retain talent."