Hong Kong Towards a Leading Global FinTech Hub

74 75 Talent Part I: Examination of Seven Fintech Hubs 272. Swiss Finance Institute. | https://www.sfi.ch/en/?gclid=Cj0KCQjw9YWDBhDyARIsADt6sGYXOa7k__ X73GnDrILku-KKB81BM2tj2vxN0hDXMIFwshAFTyFE8kkaAgIkEALw_wcB 273. Swiss Finance Institute. | About Us. | https://www.sfi.ch/en/about-us 274. The survey period was around 2018 to 2019. For details, please visit https://www.michaelpage.com.hk/about- us/media-releases/95-survey-respondents-agree-hong-kong-facing-acute-fintech-talent-shortage 275. Michael Page. | Hiring in Fintech – Survey and Dialogue. | https://www.michaelpage.com.hk/sites/michaelpage. com.hk/files/16785-hk_fintech_brochure_mp.v8.pdf 276. Michael Page. | Hiring in Fintech – Survey and Dialogue. | https://www.michaelpage.com.hk/sites/michaelpage. com.hk/files/16785-hk_fintech_brochure_mp.v8.pdf 277. South China Morning Post. | Hong Kong’s IT sector facing shortage of skilled talent as Covid-19 keeps foreigners away and locals mull migration (Mar 2021). | https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3125233/hong-kongs-it-sector-facing-shortage-skilled 278. South China Morning Post. | Hong Kong’s IT sector facing shortage of skilled talent as Covid-19 keeps foreigners away and locals mull migration (Mar 2021). | https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3125233/hong-kongs-it-sector-facing-shortage-skilled 279. The Hong Kong institute of Bankers. | Talent Development Survey 2019 (2019). | http://www.hkib.org/pdf/1587977354_HKIB%20Talent%20Survey%20 2019%20Full%20report.pdf 280. South China Morning Post. | Hong Kong’s IT sector facing shortage of skilled talent as Covid-19 keeps foreigners away and locals mull migration (Mar 2021).| https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3125233/hong-kongs-it-sector-facing-shortage-skilled 281. HKUST Business School. | The Fintech Talent Competency, and Manpower Study (2020). | https://www.bm.ust.hk/en-us/media-resources/overview/ publications/reports/issue:2/ HONG KONG Talent Insufficient Sufficient Hong Kong as a Global Fintech Hub: Talent The limited local supply of experienced fintech practitioners causes a high turnover in the fintech industry, 274 and more than 30% expect a 12–20% salary increment when changing jobs. Apart from salary, benefits are also an important consideration. Some of the most popular benefits include flexible working hours (62%), medical benefits (61%), and additional training and development courses (53%). 275 In Hong Kong, 60% of fintech employers prefer domestically cultivated talent. 276 However, recruiting and retaining local talent is not easy, especially for startups and SMEs, as most talents are attracted to larger and more established companies, which are more able to offer higher salaries, better job benefits, and clearer career paths. Recruiting foreign talents would be an interim solution to answer the needs of experienced fintech practitioners. The government has launched a number of schemes such as the Global STEM Professorship Scheme and Technology Talent Admission Scheme (TechTAS) that were designated to attract international talent to work in Hong Kong. However, the COVID-19 pandemic has brought international travel to a halt and hindering global mobility, which makes hiring foreign talent more difficult. The Hong Kong government is expected to continue to stay responsive and adopt new approaches to help narrow the fintech talent Zurich’s banks and insurance companies place an emphasis on continued education. They actively collaborate with the government to provide training opportunities for young employees, including offering introduction programs to high school graduates, internship placements for university students, and other training programs for fresh graduates. The Swiss Finance Institute (SFI) 272 founded in 2006 by the Swiss banking industry, the Swiss Confederation, and leading Swiss universities, is a successful public-private partnership that combines academics and practical experience in the training for banking and finance talent. It is also the only national center uniting six universities across the country, 273 forming a powerful knowledge capital to guarantee long-term prosperity of the Swiss financial market’s development. The SFI has published over 100 banking and finance related articles in top academic journals. Each year, it conducts more than 30 Master’s level classes for financial practitioners in Switzerland. It is also home to the world’s largest PhD programs in finance. supply-and-demand gap in Hong Kong in response to the disruptions brought by the pandemic. According to figures from the Immigration Department, the number of work visas approved heavily decreased from 41,289 in 2019 to only 14,617 in 2020. Moreover, new visa applications in the IT industry also decreased from more than 1,600 in 2019 to 652 in 2020. 277 The pandemic affected the talent inflow from international countries and Mainland China, where the number of new visas for the Mainland Talents and Professionals Scheme has dropped by nearly 50% in 2020. 278 Nevertheless, the development of the Greater Bay Area will bring talent exchange and talent development opportunities to Hong Kong. The talent exchange facilitated by the Greater Bay Area development plans would likely provide more talent with technical skills to Hong Kong from Mainland China in exchange for some of Hong Kong’s financial talent. However, instead of relying on foreign talents, Hong Kong’s ultimate objective should be having a sufficient and sustainable talent supply that is the right balance of local and foreign talents. Hiring from local universities has always been a major source of talent for finteh companies. Understanding the global needs for fintech professionals, the universities in Hong Kong have been gradually increasing the number of fintech-related courses and degree programs at undergraduate and postgraduate levels in recent years. As of May 2021, there are 12 fintech-focused degree programs at the undergraduate and postgraduate levels offered by seven local universities, of which includes Doctor of FinTech (DFinTech) , the first doctoral level fintech-related degree, offered by the Hong Kong Polytechnic University. Other than the local educational institutions, different government units and private companies also organized talent development and training programs for university students and industry practitioners. They also work with the universities and each other on a wide variety of talent development initiatives, including student competitions, hackathons, workshops and seminars. For a shorter- term supply of talent, upskilling existing financial services practitioners would be a common source to fill the continuously surging demand. The advantage with upskilling existing staff is that they already have a good understanding of the business, culture and operations of the company and the industry. According to the Talent Development Survey 2019 conducted by the Hong Kong Institution of Bankers, around 70% of respondents agreed that banks should reskill and upskill existing staff, while 97% believed banking practitioners should enhance their fintech capabilities. 279 However, in-house training requires both financial and human resources that may not be feasible for small and medium firms. There are around 3,360 startups in Hong Kong, employing 10,688 professionals. 280 Fintech employers – no matter startups or tech giants – are competing for the same pool of talent. The top sources of talent for the Hong Kong fintech industry are: (1) recruiting practitioners within Hong Kong, (2) upskilling existing staff, (3) recruiting from local universities, followed by (4) hiring graduates and practitioners from outside of Hong Kong, 281 which shows that banks and fintech companies prefer local talents more than foreign talents. Meanwhile, hiring foreign talents could provide an interim solution to ease the talent shortage problem as current practitioners are limited. Overall, the Hong Kong financial services industry is facing the challenges to attract and retain talent to meet the demand of implementing digital blueprints, especially those with expertise in data science, cloud computing and cybersecurity. Since regtech has become a major strategic focus of regulators in Hong Kong, people with the tech skills to address the related tech issues such as the complexity of AI models and lack of quality data will be in even higher demand.