Asia – Still a Labor Paradise For Global Employers

What Drives Businesses Surely not dissatisfied staff, increasing job mobility, rising wage demands, lack of talent management strategy – these are real issues currently facing the war of talents in booming economies of the Asian region.

Asian workers are more than willing to chase the best jobs and money, hence creating a talent and retention crisis for both local and western employers in the region. Their expectations are rising, and are no longer prepared to settle for second best and feeling that they deserve more than they were getting. Job-hoping is predicted to become the biggest talent crunch in Asia for organizations over the next three years.

Highlighting a study by recruitment firm StepStone’s Talent Report 2008, the notion of a low-cost utopia with abundance of cheap labor is long over. Senior management reported a four major recruitment and retention obstacles – rising wage and pay demands among potential candidates; a lack of suitable candidates and skills; a perceived lack of career opportunities among workers; and employee increasingly believing they could obtain better pay and benefits elsewhere.

Still, 40% of the business leaders surveyed believed that Asia Pacific offered their business the best opportunities for revenue growth over the next three years. The region has been much less affected by the Europe or the US subprime-led credit crisis and comparatively, areas such as financial services are currently particularly strong.

Given this labor backdrop, global consensus of the business leaders indicates that many companies will have to arm themselves for an impending war of talent, maybe one tougher than even in the Europe and North America.

Yet, only about a quarter of them surveyed had a formal, organization-wide talent management strategy in place and about 16% had no talent management strategy. It points to the fact that these organizations are that they are poor at forecasting talent requirements and talent retention.

To compete for the best people, organizations have an urgent need to address how they are going to manage their talent in a much more structured way. Without which, their potential to grow the business is in dire straits.

While it was in Asia that recruitment and retention difficulties were most acute, business leaders in Western Europe and North America also agreed that employee career-switching would be a major issue in fueling talent shortages there. However, business leaders in the US and Europe were in general more concerned about the effects of an aging population and a lack of education and development opportunities.