It’s been a tough year (and counting) for Hong Kong. The economy has been in recession during the back half of 2019, and being in the middle of a public health epidemic, most businesses are facing increasing uncertainty and mounting financial pressures.
By looking back at data from SARS, and current recruitment trends on our own platform, let’s take a look at the similarities, where we are now and three things we can do to plan for when things go back to 'normal'.
2003 vs 2020: Similarities
When SARS was declared a global emergency in March 2003, the economy was still recovering from the Asian Financial Crisis: domestic consumption was shrinking, economy contracting and unemployment rates going up. History is repeating itself now, with the current COVID-19 outbreak. While the economy being hit hard during the 2019 protests, COVID-19 comes at the worst time for many businesses.
During SARS, domestic spending, tourism and re-exports (goods manufactured in China and exported globally) was the hardest hit, and many severely affected sectors either laid off staff or undertook work-sharing schemes in face of lower demand. This is being echoed in the present day; hard-hit companies like Cathay Pacific are implementing mandatory three weeks of unpaid leave.
Light at the end of the tunnel?
Glass half full:
- SARS was largely under control by July 2003, 4 months after the outbreak was classified as an emergency, and by August, visitor numbers, occupancy rates, retail sales all bounced back to pre-SARS levels.
- Despite criticism of Hong Kong’s response, there hasn’t been any evidence of widespread community infection locally, and the global spread of the disease has been largely contained to Hubei.
- There are signs that the infection rates are slowing down within China (assuming the data is relatively accurate)
Glass half empty:
- Still potential for there to be further outbreaks in Hong Kong - with recent outbreaks globally increasing the fear of transmission
- The impact on tourism has been even worse than SARS – total visitors are down to 3000 a day, down from an average of 200,000 per day.
- What will be the impact on China’s economy, and how will that affect Hong Kong? When will visitors return to Hong Kong?
- What happens after the outbreak is contained? Will protests continue where they left off?
Insights in recruitment – recent data from Wantedly:
Our active users and traffic on our platform have seen a strong upward trend; spiking over 60% during the last month. This could be attributed to a possible combination of passive job seekers looking for greener pastures out of struggling industries, and active job seekers who may have been recently made redundant. However, this is contrasted by the low number of job openings currently available due to uncertain economic conditions. From our informal observations, most headcount and hiring have been put on hold.
Planning for Recovery:
When the recovery finally comes whether it is six months or nine months (or God forbid, longer), how do you position your business, to go out faster than others? Other companies may not be thinking about this, because they’re only thinking of the here and now.
It's been a tough few months to start this year, but like all things, this too will pass. Here are some ideas to plan your hiring and recruitment initiatives:
- Retain key staff – make the effort to reassure and retain key staff members, especially those who are responsible for driving revenue. Losing key staff might put you behind the starting blocks when the economy recovers.
- Build your recruitment pipeline – talent is abundant in the job market. There's a lot of people looking, but not many hiring. It’s a great opportunity to attract and engage with top talent to have a pipeline in place for the future.
- Keep an eye on the competitors – it’s inevitable that in these conditions, some companies will close up shop. When this happens, there’s an influx of battle-tested talent made available into the marketplace, with positions in high demand like developers, UI/UX designers and data scientists roles snapped up quickly.
Siu, A., & Wong, Y. C. (2004). Economic Impact of SARS: The Case of Hong Kong. Asian Economic Papers, 3(1), 62-83. https://doi.org/10.1162/1535351041747996