The Hudson report, Q1 2007, Singapore – Employment and HR Trends.

“Employment expectations are rising and companies express a high level of optimism about future performance. But the other side of the coin is severe competition for staff. Companies recognise they must be prepared to look at the ackages they offer which would now include significant increases in salaries and bonuses in order to attract appropriately talented individuals.” Mark Sparrow, Country Manager, Hudson, Singapore.

The Hudson Report (January-March 2007) is a quarterly survey on the hiring expectations across the industry in Asia (Japan, Hong Kong, Shanghai and Singapore). These surveys are conducted by Hudson consultants amongst the executives from multi-national firms. Some of the key findings within the IT and Telecommunications industry in Singapore is given below:

• Permanent employment expectations: 56% of respondents are expecting to hire more staff in Q1 but an imminent surge is expected as usual in Q2, after detailed planning for the year during the 1st quarter.
• Permanent employment expectations by job roles: Demand for IT professionals is high at 17%, second to Sales jobs which is at 23%. Banking IT specialists are much sought after as more banks are setting up new operations or upgrading existing operations.
• Pay increases to attract managerial staff: 57% say they will pay more than 10%, compared to 35% in Q1 2006. Banks however are expected to pay by far the highest increase, with 78% saying the salaries will rise by ore than 10%.
• Year-end bonus payments: 51% of respondents plan to pay bonuses of more than 10%. Steep rise from 32% in Q1 2006. Banking sector again is making by far the highest bonus payments, with 76% planning to pay more than 10%.
• Staff turnover: 37% of IT&T companies are experiencing turnover of more than 10%.
• Reasons for staff turnover: Poaching is the most significant cause for staff turnover with 30% of the respondents attributing the turnover due to poaching. 10% of the respondents in IT&T, which is significantly higher than any other sector agree that ‘Low staff morale’ is also a very significant reason for staff turnover.

The year 2007 from staffing perspective is expected to be as buoyant as the Singapore economy outlook. Banking and IT are two sectors which will see a significant increase in resource augmentation and this is no surprise considering the number of banking institutions that are already/in-process/on the verge of setting up new/refurbishments/upgrade of operations and data centers.

As competition for quality resources heats up amongst the banks here, a major resource crunch is expected and banks and their recruiting partners will have to progressively look at ways to source and import talent from outside Singapore.

This means that further improvement in salary payouts will have to be implemented in order to attract, recruit and retain quality talents from location such as India and Hong Kong.

Of late, we are seeing a reversal in recruiting trend as far as India is concern – companies in India are looking to recruit from outside India. One of India’s largest Software Development company is in the process of luring back Non-resident-Indian IT pros for middle and senior roles for their projects in India and so are most of the MNC banks in India who are facing stiff challenges in recruiting senior level consultants. We are also seeing specialist recruitment firm such as Job options which is founded and managed by Mr. Achyut Menon. In his own words - “I am pretty convinced that 'global migration' of professionals will be a reality soon, and so it is better to dig ones wells..before one is thirsty!!”. He is of course referring to returning Indian professionals.

This obviously means that companies in India are prepared to match the consultant earnings abroad - dollars to dollars. This will also mean that they are willing to pay the talents within in India which will match their potential earning abroad in order to retain them. This trend is especially prevalent in the banking sector; with so many banks moving their back office support offshore to India this seems to be the obvious.

It therefore, does become necessary for IT&T and banking companies in Singapore to pro-actively look into their existing salary standards and make necessary changes and sacrifices to remain competitive in the fight for quality talents in this part of the world.

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Back Out candidates phenomena

back out
1. To withdraw from something before completion.
2. To fail to keep a commitment or promise.

Recruiting is a very exciting and challenging profession and even more so when you recruit IT consultants. The challenges for an IT recruiter in today’s job market are in convincing and managing IT job seekers to remain committed and not back out during the hiring process. With the current IT market boom, good IT consultant can find himself with multiple job offers at any given point of time and will get approached and head hunted by head hunters and recruiters alike constantly. And because he has multiple offers at hand he is bound to remain true to himself and not being loyal to anyone consultant, after all he can only take up one offer at one time. This will also means that to the other recruiter he is bound to be another case of a back out candidate.

As a recruiter, the most frustrating aspect of my job is to have in my hand a candidate backing out – during or after the selection process. For most of us, the stress that we go through as a recruiter is not so much from the targets and the deadlines but the uneasy feeling of not knowing if your selected/shortlisted candidate(s) will remain committed to your offer and take up the job.

My first back out experience in Singapore was with a candidate who had a niche-hard- to-find-skill that we sourced and selected from one of the leading software house in Southern India. The pre-qualifying and the interview process went smoothly and the client was happy and they want him on board ASAP. To make a long story short, we waited for him for one month and on the day of his departure he kept us in tenterhooks by not picking up his calls and when we called his home his family will not give us proper response however subsequently we managed to talk to him and he assured us that alls well. But later I got a call from the airport and that was 2:00 in the morning and he told me that he is not flying and he will not be able to join us because of family reason. That’s it. He decided in the last minute he won’t join us. Here our client IBM is under tremendous pressure themselves from their client because this candidate was supposed to be the lead guy and they wanted to parade him in front of the client the following day. Poor me, I had that sinking feeling deep down inside and I just wasn't feeling good at all to face the client.

Backing out of job offers is a big issue especially in country like India because of the bullish job market. I believe the situation is not so bad for organizations which are of repute and are well established such as Infosys, TCS, Wipro, etc but those second and third tier organization are the one facing the brunt of most of the back out cases. This could be attributed mainly due to the fact that the big boys do not have difficulty in attracting job applicants because of their good brand image and willingness to shell out above average market compensation.

Types of back out:
Let’s look at what stages of the recruitment process a back out can possibly happen.
1. Candidate backing out before the interview
2. Candidate backing out after interview
3. Candidate backing out after accepting the offer
4. Candidate backing out before joining
5. Candidate backing out just after joining

Probable reasons for back outs:
Varied reasons can be attributed as to why a candidate back out, from my past experiences below are some of the common ones -
* Have in hand several offers and will decide on the one best offer
* Developing cold feet at the last moment before submitting his/her resignation letter
* HR/Line Manager convinced him/her to stay back
* Was given a very good counter offer by employer so decided to stay back
* Not serious about leaving current job, and attending interviews just because the opportunity was presented to him/her.
* Learnt of the project which was not to his liking/preference/expectation and is not keen on joining
* The final offer not up to his/her expectation
* Did not agree with some of the clause(s) in the offer letter/appointment letter
* His/her friends/contacts gave negative feedback about the organisation so decided not to join
* Required joining time not reasonable
* See what offer he/she can get from the market to negotiate a better salary with existing employer
* Selection process took too long and has already accepted another offer
* Tried re-negotiating for more salary after selection
* Genuinely have personal/family issue because of which he/she cannot take up the offer

Repercussions & affects of backing out:
- Recruitment is an expensive activity. Every time a candidate backs out the recruitment process has to be initiated all over again.
- Good amount of time and effort is wasted to find a new replacement and projects can and do get delayed and all these translates to revenue lost
- But most important of all is the lost of client’s trust. This is non tangible and will have long term adverse affect vis-à-vis client-vendor relationship.

How to avoid & reduce candidates backing out:
• If you and your candidates are in the same area it is always advisable to meet face-to-face.
• Be it on the phone or in person spent as much time as you can and dig for information – what motivates him to look for a change, professional and personal reasons, what are his expectations in terms of money and roles, etc.
• It is important to be in control when it comes to recruiter-candidate relationship. To achieve that it is important that you conduct a thorough pre-qualifying. Get all the low-down about his background and aspiration, et al.
• Always insist on obtaining either verbally and/or in writing his/her response and commitment to the job offer. You may do this with a direct approach or with great subtlety. Which approach you resort to will depend on each individual or their level of seniority – you need to make the right judgment.
• Constantly update him/her on the process and try keeping-in-touch on a frequent basis.
• Pay close attention while talking to him/her and listen for those tones and expressed/unexpressed concerns and look for those signs that might indicate his intentions.
• If any of his/her words, expressions, actions gives you a sense of doubt and concern, then drop him/her and move on. It is better to drop him/her now than later have a back out in your hand.
• Have a set of questionnaire that you can run through with him/her before proceeding to qualify him - questionnaire that will test his seriousness and sincerity to look for a change.
• Do not hesitate to ask them if they have discussed with his/her family members about this plan to look for a job change. Especially for those who are married, please confirm with them if they have consulted their other half.
• Try and get inside your candidate’s mind, understand his needs and his aspiration.
• Pro-actively try to cover all areas that you possibly think will be a likely point of concern (reason for a back out) for him at a later stage and addressed them immediately.

If after all this you have a back out it’s probably all right, after all, let us not forget that we are only human and let us accept the fact that they too are also just human like us and not anything else (wink!). Like us they too can have many internal and external influences/flaws for them to change their decision at a drop of a hat or act differently at times without any rhyme or reason.

The trick here is to constantly learn from ones mistakes and not repeat the same mistake the next time round. A good recruiter is someone who no matter how many times he falters and gets knocked down will reinvent himself and come back again and again but stronger, better and smatter.


Appreciate if you can share any additional suggestions/comments on how one can avoid candidate backing out.

*** Happy hunting folks!***