Hong Kong is a key conduit of foreign direct investment into and out of mainland China, and increasingly – a vital locale for Belt and Road infrastructure related legal work. In this interview with Asia Law Portal, Rob Green, CEO of GRM, provides his in-depth insights into current market conditions in legal recruitment in Hong Kong.
What’s the current state of hiring in the Hong Kong legal market? Which practice areas are seeing the most (and least) activity?
The current state of legal recruitment in Hong Kong is one of mixed feelings.
The country is in recession, with Bloomberg reporting just last week that HK’s economy shrank 3.2% in the third quarter from the preceding three months, wider than the 0.6% expected. It’s the first recession since 2009 and it’s unclear when things will recover. HSBC said its rate cut should help the economy, but also signaled there’s not much room to pare borrowing costs further. All the major indicators are down – retail sales, SME sentiment, visitor arrivals, HKD deposits, and property sales.
But there is still some deal flow, and there are needs for adding specific skill sets. I think all lawyers will tell you they are not getting approached as much by recruiters, and that the job flow has slowed.
But we are seeing many more firms look at part-time employment, temping through traditional agencies or new law/temp firms, job-sharing, and simply not replacing those that leave and rather spreading the work to other team members.
Leading agencies like GRM, Robert Walters, Lewis Sanders, those that have been in the market for many, many years are still leading the way and when times are tough, firms will still utilize the services of their trusted recruitment firms to find them the top talent.
So, as I say it’s a mixed environment with job flow down – but typically the job market is about 6 months behind the financial one, so the worst may be still to come. However, we all know that HK is very resilient, the business environment has been through many tough times before and it always reshapes and comes back better than ever. So longer-term, I am not concerned.
The current areas that we see a bit of job flow are in finance, litigation, insolvency and business rescue.
In recent years Hong Kong has sought to become a hub for Belt and Road deal making – including in legal services related to disputes, infrastructure finance and other areas. Has this trend impacted legal hiring in these specialisms?
Not really, because you are talking about a City with some of the brightest legal minds in the world already here, so the talent is already here to handle the increased deal flow. I think people sometimes get caught up in the headlines, like the growth of Singapore or New Law, or whatever is fashionable that month – but they forget HK has been at the forefront of global legal services for 75 years or more, attracting the very best talent the world over. So when marketing for the work coming out of the Belt and Road initiative – HK has been best set up to win that work, because the best people are already in place, and they are people with global experience, that understand China and what the country is trying to achieve.
So, whilst there may be a person or two added here and there, there has not been a huge significant need for additional talent because HK already has the best talent in the region.
In the past year Hong Kong has seen several lateral partner moves. What is the lateral hiring market condition now?
It remains buoyant but maybe about to slow as the economy slows and new partners recently hired, are bedded in. Anyone with a solid, reliable transferable book of business will still be attractive to an ambitious firm and I am a firm believer in growing whilst the markets are depressed so you are fully armed when the markets inevitably bounce back. So laterals will continue to be hired by any firm with a forward-thinking business strategy.
Retaining Associate Attorneys can be a challenge. What’s the state of the associate lateral hiring market and are firms making greater efforts to retain them?
Like I alluded to above I think the well-established legal recruiters have had a good year for Associate hiring. But I will caveat that with the fact that the job market typically follows 6 months behind the financial markets, so the real challenge for recruiters may come in the first 6 months of 2020.
I think Law firms still face the same challenges they have always faced in keeping Associate talent – and you can only do so much. Make your environment progressive, ambitious, caring and well paid and people will stick around, if it’s not, then they will go elsewhere. People are not so driven by money any more and more about their well-being – keep that in mind.
As we look ahead to 2020 — what’s your advice for firms looking to hire and attorneys looking for work?
For firms looking to hire and attorneys seeking work is the same, consider all employment options. What I mean by that is be flexible, consider contracting lawyers through payroll recruiters like GRM, consider short-and long-term assignments, consider a myriad of pay structures even including more focus on bonuses than base salary.
Be flexible in your approach, be open and creative and that will land you what you are looking for.
What’s the overall competitive climate for foreign firms in Hong Kong?
It is still good, but very competitive – clients are looking for value and increasingly turning to China law firms who have strengthened their HK teams and local HK law firms are picking up exciting work. Despite the negativity surrounding the business environment, people need not get spooked – continue to strengthen and market yourself, be flexible and creative with fee structures and the work will continue to flow.
I think 2020 will be a good year for law firms, inhouse, NewLaw, and legal recruiters that have a history of great service and delivery to back them up.
For more information, please contact Rob Green, CEO of GRM
