If you want to secure a foothold in the Asian market, one of the best ways is to start in a contract position, with this market growing rapidly in the region. We spoke to recruiters about how to get a contract role in Singapore or Hong Kong.
Demand is growing
There are many reasons for the rapid growth in contracting in Singapore and Hong Kong. Kyle Blockley of KS Consulting says companies have been motivated by headcount pressures and a shift to offshoring. “Many new roles are usually offered on contract so when employers decide to offshore teams, permanent staff take over roles held by contractors, who are then let go.”
Tricia Liverpool, MD of Morgan McKinley in Singapore, says the firm saw a 15% rise in the number of contractors hired in the Lion City in 2012, while to date in 2013, that number is up 40%. “Hong Kong is about the same. China is less contract savvy but the landscape is shifting.”
Craig Brewer, director of banking and financial services for Hudson’s Singapore office, says the global financial crisis was a major stimulus for contract work in Singapore, as many foreign banks needed to juggle their permanent headcounts to accommodate moves to lower cost locations. He says Hong Kong hasn’t seen the same degree of shift to contracting as Singapore, as that market still has a permanent workforce mindset.
On the ground
The good news is that opportunity abounds. The bad news is that it mostly benefits people who are already in the country. But Morgan McKinley's Liverpool says it does depend on the role. "Certain skills, such as those needed for big IT projects or tasks requiring very senior change agents, are offered mostly by international talent, and organisations are open to finding those people wherever they are based."
Pay as you go
One of the drawbacks about contracting in Asia is that wages are not on par with those earned by contractors elsewhere in the world, where they often command a premium to their permanent peers' salaries. The latest annual Robert Walters salary survey shows that contracting pay for, say, a finance director, is in the region of SGD$18000 per month, which comes to SGD$216000 per year, while a permanent role can earn you SGD$2-300000 per year.
Garrett Tardrew, manager of the banking and finance contract division of Robert Walters Hong Kong, does not recommend that candidates accept a salary lower than their expectations for a permanent position. "But they should consider whether the job will bring long-term benefits. Taking a short term view purely on pay is career suicide."
Leanne Nettleship, who is a manager in the contracting division of Robert Walters Singapore office, points out that even if there is no salary premium, many Asian companies pay contractors other benefits that are not usually offered in places like the US and UK.
Hudson's Brewer recommends that contract candidates be prepared to take a slight pay cut for a contract role - in the range of 10% to 15%. "If, however, your job is project-based or carries a lot of responsibility, you can definitely negotiate a completion or performance bonus and even some paid annual leave if the contract lasts more than six to nine months."
Another option, says Morgan McKinley's Liverpool, is to set up your own company to make it more effective and attractive for employers to take you on. This will provide you with greater wriggle room to negotiate on pay.
Singaporean companies are hiring, with lots of opportunities in finance contracting
Unemployed bankers accept contracts on 25% less pay
A happy ending
For people who have been laid off in these markets, contract work is often a good way to ease into another full-time role. All the recruiters we spoke to said that it is common in both Singapore and Hong Kong for contract workers who have performed well to be taken on in a full-time capacity or to have their contracts extended, sometimes indefinitely.
Don't pack just yet
Contractors need to educate themselves about some of the drawbacks of working in Singapore and Hong Kong, with one of the most significant being the hefty cost of accommodation. In both cities, it is very rare to find a rental for less than a year, and serviced apartments are very expensive. with prices starting for studios at around SGD$6000 per month, or USD$4700, which is close to what you might pay for a serviced studio in Manhattan.
A furnished apartment, on a minimum one-year contract, can cost anything from SGD$4000 (USD$3100) for a basic studio, and tenants usually have to pay steep estate agent commissions. Foodstuffs and other necessities can cost about 20% more than in New York and London, although hawker centres do offer affordable meals for a couple of dollars a time. Alcohol in Singapore is expensive, with an average bottle of wine sometime costing 50-100% more than you might pay in the UK.
KS Consulting's Blockley says that unless an employer takes responsibility for accommodation, it is not worth it to take on a contract job in Singapore for less than a year's duration. "There are too many difficulties in getting set up."
Robert Walters' Tardrew says Hong Kong can also be a very expensive city, but points out that like Singapore, personal income tax rates are low compared to many other parts of the world.
The visa issue can also prove a stumbling block, but Hudson's Brewer says that candidates looking at Singapore can apply for a Personalised Employment Pass, which permits both permanent and contract work. "However, to qualify for a PEP you must be able to prove a fairly high level of income in your last position as well as relevant skills and experience."