Who`s the Boss?
    Category: Column By : Olly Riches Read : 1438 Date : Thursday, August 11, 2016 - 08:11:30

    Southeast Asia is one of the world’s most dynamic regions—with Indonesia a market to watch. Given a young population and a burgeoning middle class, growth opportunities are plentiful for businesses and candidates in Indonesia. However, this accelerated pace is often contradicted by a limited talent pool, and exacerbated by increasing pressure to localize the country’s workforce.

    With limited talent ripe for the plucking, candidate expectations of salary increases have naturally escalated. The Michael Page 2016 South East Asia Salary and Employment Outlook reported that Indonesians have the highest salary expectations in the region. Some 28% of Indonesian respondents expected their salaries to improve by at least 11%, compared to just 3% in Singapore and Malaysia.

    Indonesian candidates are also more likely to change jobs than their regional counterparts, with 50% moving for money and just 15% doing so to broaden their experience. The study leaves no doubt who is driving the market—Indonesia has evolved into a candidate’s playground.

    From recruitment to retention
    To attract and retain star candidates, companies should put more effort into hiring as well as engagement strategies. Recently, more Indonesian organizations have turned to developing a strong company culture—and wisely so, with 50% of Indonesian respondents citing a strong company culture as a major retention factor. Career growth and leadership development should also be on offer, as 53% said they would stay in a job for career progression opportunities.

    This mindset reflects a big shift for the human resources (HR) team. Traditionally viewed as an administrative function in Indonesia, HR now has to move towards improving staff retention and exploring non-financial benefits, including talent management, to cut the cost of replacement hiring. Talent management is important to an organization’s growth, ever more so during this period where workforce localization is heavily emphasized in Indonesia.

    Over the years, government regulations concerning expatriates have been tightened and the once-popular trend of bringing in a foreigner as company head is on the decline. The heat is on companies to hire local candidates as much as possible. In 2015, 90% of the 135 middle management-to-board level placements made by PT Michael Page Internasional Indonesia were Indonesians.

    While the hunt for a capable and qualified workforce remains a challenge for many companies in Indonesia, one thing is true: There is an ever-present need for candidates who can push companies forward, while understanding the cultural sensitivities of doing business in Indonesia.

    This demand is likely to intensify as local conglomerates seek to emulate MNCs in globalizing their businesses. Such criteria often point toward a certain profile: Indonesians educated overseas and with experience working in MNCs.

    While some may ask if this diaspora can be effectively wooed back home, we are confident in growth as the Indonesia government implements its infrastructure plans. While Jakarta is currently the biggest capital city in the world without a metro system, one is now being built. The government has committed to investments on infrastructure, inclusive of roads and airports. These, coupled with the tech boom and rise of local conglomerates, make Indonesia an attractive market for investment from bigger global players.