Dual Impact of Bonus Plunge and Great Resignation Drive Staff Turnover to 5-Year High
HONG KONG, December 23, 2022 – Bonus to be paid in 2023 are expected to decline sharply due to debt crisis and surging interest rates. This will add fuel to the five-year high staff turnover triggered by the Great Resignation, according to Pretium Partners Asia Limited ("Pretium").
Pretium Year-end Rewards and Human Resource Trends Survey - 2022 (“Survey”) examined changes in business performance, salary review budget, bonus levels, headcount changes as well as changes in human resources priorities to facilitate human resources planning. Key insights from the survey are as follows:
Projected Bonus Levels of 2022
The projected bonus payout in 2023 is expected to be significantly lower than that of the 2022 due to debt crisis and slower market activities.
The Direct Investment team will face the hardest hit in the front office with projected bonus payout drop by 36% in 2023. The Administration team will also see their bonus payout down by 27% next year. “Bonus will be significantly down due to weak IPO and market sentiments, this will aggravate the high enough staff turnover caused by the Great Resignation,” said May Poon, Managing Partner at Pretium.
High Staff Turnover Rate among Millennials
Staff turnover has increased during the waves of Great Resignation powered by COVID-19. The firm-wide turnover rate is 16%, with the Millennials experiencing the highest turnover (19%).
“With bonus levels going south, companies need to optimize pay and incentive strategies to retain a multi-generational workforce, especially for the Millennials who are competitive in nature and emphasize equity in their value proposition,” Ms. Poon explained.
“Profit sharing can act as a bridge between short-term and long-term incentive to motivate performance and reinforce retention. Pay differentiation can be widened by having different pay positioning in a given year according to annual business performance，” Ms. Poon added.
About Pretium Year-end Rewards and Human Resource Trends Survey - 2022
Pretium Year-end Rewards and Human Resource Trends Survey Report - 2022 examines performance, reward and human resources trends in Asia, including salary increase, bonus levels, business performance, headcount changes, staff mix ratios and changes in HR priorities. It covers 70 international, regional and local investment banks, asset management and private equities firms as well as insurance companies with multiple offices in Asia.
About Pretium Partners Asia Limited
Pretium Partners Asia Limited ("Pretium") has been selected as the Best Compensation & Beneﬁts Consultant (Gold Award) in 2022 and (Bronze Award) in 2021 organized by Human Resources Online. Pretium helps accelerate clients' growth and increase profitability through unique spectrum of solutions which include rewards, performance management, benchmarking, organization transformation and integration for mergers & acquisitions.
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