While the credit crunch might be dismissed in boardrooms as a short-term speed bump, it would be folly for Western businesses rushing to invest in high-growth Asian economies such as China and India to ignore the clear signs of longer-term talent shortages in Asia. 

StepStone’s Total Talent Report 2008, researched and prepared by the Economist Intelligence Unit, investigates international recruitment trends, with a particular focus on the challenges of attracting and retaining staff in Asia.

The research surveyed 392 senior executives from Asia, Western Europe and North America to discuss the recruitment and economic development opportunities that exist in emerging markets.

Executives in Asia cite four major recruitment and retention obstacles:

• Rising wage and pay demands among potential candidates
• A lack of suitable candidates to recruit and a lack of appropriate skills among potential candidates
• A perceived lack of career opportunities among current employees
• Employee perceptions that pay and benefits could be better elsewhere

Growth prospects in Asia

• Despite the difficulties, 44% of all business leaders surveyed globally believed the Asia-Pacific region offered their business the best opportunities for revenue growth over the next three years.
• 87% expected either slight or significant improvement in their company’s growth prospects over the next three years, with only 29% saying the rising cost of credit had caused them to be less optimistic about their organisation’s future prospects.
• In a market in which the demand for talented individuals far outweighs the supply, 52% of companies said that Asian candidates’ pay expectations were too high, compared with just 42% in North America.
• 55% of companies stated that candidates in Asia lacked appropriate skills, compared with 47% who claimed the same for Europe.

Colin Tenwick, CEO, StepStone:

“This research shows that many companies will have to prepare themselves for a huge battle for talent, one that is even tougher than in Europe and North America. Asia is seen as the engine for growth but without the right people, businesses will see their engine splutter and may not get out of first gear. 

"Without a clear, formal talent management strategy in place, companies will find it difficult to get – and more importantly, keep – the people they need and may struggle to realise the growth they are promising their shareholders.”