SINGAPORE's booming economy has kept the job creation machinery working overtime, producing a record number of job openings. These need to be filled to keep the economy growing.
Last year, the Singapore economy created 236,600 jobs - the biggest increase since 1997, when the Ministry of Manpower started collecting such data.
Companies require the extra hands to meet orders and boost profits. And they want to hire the best to do the job - or they will lose out to rivals. Increasingly, as globalisation tears down borders, this is often almost a matter of life and death. But talent has always been a scarce commodity. Locating and hunting down talent requires expertise employers often lack.
Perhaps that's why executive search firms, or headhunters, are in business. Demand for their services has grown as talent becomes even harder to come by.
Globalisation has thrown the doors of nations wide open to talented individuals, stepping up their mobility. This has swelled the talent pool, but the war for their services has also grown more intense, aggravating the shortage.
Recruitment of talent is no longer confined to the home-ground - the search has gone global. Which makes the service of headhunters, especially those with an international network, even less dispensable.
The war for talent has reached critical proportions in Singapore, where businesses have singled out tackling staff shortage and job-hopping as the top challenges they now face.
Physical limits in tiny Singapore have always put a tight cap on the numbers available. The hot economy in the past two years has only tightened the talent crunch, as companies scrambled to hire people.
The outflow of local talent has not helped. It's not just the government's go-international push that is encouraging talented Singaporeans to venture out. Elaine Ng, managing partner at HRBS, a human resources service provider, says many Singaporeans are lured to booming China and Hong Kong to work.
'The fact is Singaporean managers are in demand and hunted for overseas posting,' Ms Ng says in an article contributed to this supplement (see Page 20). 'They are especially sought after for work in emerging or developing Asian countries ... Young and bright Singaporeans fresh out of the university are wooed and pursued by Hong Kong's financial industry with top dollars. Singaporeans' ability to speak English, Mandarin and Malay plus their technical and professional expertise stand them in good stead.'
It's no wonder then that headhunters here are having a field day. The demand for their services has grown with the sophistication of the economy. The labour-intensive electronic industry has moved up the high-technology ladder and given way to brainy research in the biosciences and the knowledge-intensive production of drugs and medical equipment. High finance, entertainment, leisure and fancy restaurants have come to figure large in the service business.
The transformation is reflected in the make-up of the job market - and its rising complexity.
According to the Ministry of Manpower (MOM), most of the record number of jobs created in the past three years went to better-paid resident professionals, managers, executives and technicians (PMETs) who make more than $2,330 a month, the average pay of workers. The result: these employees who are Singaporeans or Permanent Residents now account for 49 per cent of the resident workforce, up from 40 per cent a decade ago.
Meanwhile, the share of production and related workers fell from 31 per cent to 26 per cent, and clerical, sales and service workers from 29 to 25 per cent.
Last year, the economy created 236,600 jobs - the biggest increase since 1997, when MOM started collecting such data.
PMETs made up 45 per cent of the 30,923 unfilled positions in the private sector in September last year - an all-time high. The top PMET openings in terms of number of vacancies were for management executives, software engineers, sales and marketing executives, electronics engineers, mechanical engineers and systems designers and analysts.
'Engineers remained highly sought after, accounting for six out of the top 10 professional occupations,' MOM says in a report. 'The construction boom led to more openings for building and construction engineers and building and construction managers.'
Demand also rose for accountants, assistant accountants and auditors, reflecting a talent shortage in the accounting and auditing professions.
Staff poaching and increasing pay are the common ploys employed by companies to attract talent in a tight labour market.
A poll by human resources firm Hewitt Associates between July and September last year found that employees up the corporate ladder - junior and middle managers - were the most prone to jump ship, especially those in the services sector.
According to the poll, most job-hopped because of the higher pay offered by competing employers. Which is why getting executive compensation right will play a key role in attracting and retaining staff in the long run, Hewitt says in its contribution to this supplement (Page 21).
'Opinions continue to vary when it comes to whether executive pay is right, but several common themes exist in nearly all the developed economies in the region,' it says. These include:
- Scarcity of outstanding leadership talent, which continues to command a high price in market-driven companies;
- More vocal shareholders who challenge excessive executive pay, especially following poor performance;
- The increasing transparency in executive pay levels, which is said to be fuelling even higher pay hikes as companies outdo each other in chasing the best leadership talent.
Hewitt suggests five practices companies should follow in shaping their compensation package:
- Select an appropriate peer group for compensation benchmarking;
- Position target total compensation close to the middle of the market in most cases;
- Ensure substantial leverage in variable compensation;
- Set stretch performance goals for variable compensation;
- Check and redefine the compensation structure.
But it takes more than pay to keep your staff happy. Kiran Kaur, senior consultant for human capital at Mercer, says the key to talent retention is to get employees 'engaged'.
'Psychologists would define it as a state where employees achieve performance levels beyond what is required of their stated jobs,' she says in a contributed piece in the supplement (Page 21). 'Such employees do so because they feel that they have a vested interest in their organisation's success.'
Ms Kaur identifies four common drivers of employee engagement: type of work performed and opportunities for development; confidence and trust in leadership; recognition and rewards; and organisational communication.
'Given the global shortage of talent and the fact that 43 per cent of respondents in Singapore (according to Hewitt's poll) indicated that they would leave their organisation within one year, organisations that approach engagement as a key priority in their talent management strategy place themselves ahead of the pack in creating a more productive, loyal and stable workforce,' she says.
Putting out the welcome mat to foreign talent is one key plank in the Singapore government's strategy to ease the talent crunch.
'The challenge is how Singapore can attract the (foreign) talents, or more precisely the transnational cosmopolitans who are willing to come to Singapore to search for jobs,' says David Leong, managing director of PeopleWorldwide Consulting.
'The cosmopolitans we are trying to attract to our shores will be the research and design engineers, scientists, middle and top ranked management executives, musicians, chefs, designers, merchandisers and all those who can make Singapore a hub for manufacturing, construction and services of sorts,' he says in his contributed piece (Page 20).
Mr Leong says the inflow of foreign talent will add to Singapore's cosmopolitanism and enrich the diversity and vibrancy of its workforce.
Such social issues are of little concern to executive search firms or headhunters. But opening the door wide to foreign talents will still pose new challenges and offer new opportunities to their recruitment business.
