With the year-end approaching, the pandemic continuing to drag on, and the recession trailing after, the labor market around the region is not especially optimistic, according to Nilay Khandelwal, Managing Director of Michael Page Singapore. Speaking at a workshop organized by business network EGN Singapore last week, he outlined several broad trends that will likely shape hiring in both the near and long term.

Employers are conservative about expanding their teams

The majority of employers today prefer to restructure their teams or develop existing employees rather than to hire, simply because this is a more economical way of growing and retaining talent. When they do hire, Khandelwal said, they hire mainly for critical roles, and they tend to prefer localized talent, possibly in response to the issues around travel restrictions and border controls.

He also pointed out that hiring relevant talent has become more difficult, with employers taking 34 percent longer to hire for permanent positions than prior to COVID-19. Even temporary positions, which are typically filled more quickly, are taking 27 percent longer.

Contracting might become the next big thing

"Contracting as a market has boomed in the last two months", Khandelwal observed of the current market trend. This, he suggested, is because both job seekers and employers are finding contract work "much more acceptable". For comparison, he pointed out that even during the 2008 global financial crisis it had been difficult to attract candidates around the Southeast Asia region to a 6-month or 1-year contract.

Employers, meanwhile, are trying to improve their staffing and budgeting flexibility by offering more and shorter-term contracts. There is also a growing trend of choosing to hire senior management consultants on contract rather than engaging a consulting firm. And unsurprisingly, employers are also trying to attract contractors with better treatment. Some companies are even raising contractor benefits to be on par with permanent positions.

Tech skills are (currently) evergreen

The roles most in demand today—specifically the critical roles—tend to be technology-focused roles, in line with the rush to digital transformation that has characterized much of 2020. According to data from Michael Page Singapore, many of today's contract roles are in technology, with skills related to telecommuting and fintech in particular demand.

These include AI, software engineering, and cybersecurity, which is sought after by organizations that work with large volumes of sensitive data, such as healthcare, financial services, or pharmaceuticals. As a result, tech skills have become a seller's market, with salary demands on the rise and job seekers much more inclined to pick and choose between offers.

Virtual recruitment continues to be problematic

Virtual hiring and onboarding poses a major challenge to many companies, Khandelwal said—onboarding being especially difficult for both candidates and employers.

"We expected that candidates would understand the challenges in having a hybrid model of work, but it was reversed," he said—instead, he and his team found that candidates expected the employer to provide an effective and well-organized onboarding experience. Candidates, he pointed out, are already leaving their comfort zone in entering a new company, and a disorganized onboarding is a huge turn-off. Some candidates, he related, have actually left a new employer within the first week because they could not reconcile their image of a traditional career with the virtual or hybrid onboarding experience.

To avoid this clash of expectations, he advised, HR has to play a greater business role in hiring and onboarding rather than simply providing administrative support. "Don't just leave it all to the hiring manager," he said. "Whatever playbook or guidelines you are using have to evolve with the current situation."

Overall, he said, there needs to be greater flexibility in hiring now that interviewing and onboarding are done remotely. Employers need to be more open-minded about how they assess candidates; offers need to go beyond salaries and encompass the overall experience. And if necessary—because these aspects of hiring are so closely linked to corporate culture—companies may even have to make deeper cultural adjustments to stay in line with today's changing norms.