Why Hong Kong Financial Services Professionals Aren't Relocating to London Yet
August 2020
Why Hong Kong Financial Services Professionals Aren't Relocating to London Yet
We have received no enquiries from Hong Kong citizens about relocating to London since the UK government proposed the resettlement scheme in May. However, this could change if Hong Kong's political and economic climate deteriorates. The situation is constantly evolving, and I believe many financial services professionals in Hong Kong are adopting a wait-and-see approach
According to the Selby Jennings Global Job Confidence Index Report, European financial services professionals are the most pessimistic about the economy, with the lowest confidence in job security compared to APAC and the US. While the British lack confidence in their market, financial services professionals in Hong Kong recognize that now may not be the right time to relocate to the UK.
While Hong Kong's GDP is projected to shrink by 5% in 2020, the UK is facing an even steeper contraction, with an expected 11.5% decline—marking the worst slump among OECD countries.
There are growing concerns that a "no deal Brexit" could cause additional economic damage in 2021 and beyond, exacerbating the UK's already fragile economic outlook.
The UK's top tax rate is 45%, while Hong Kong's highest tax band is just 17%—making it 2.6 times lower than the UK's rate. This significant tax difference is another factor professionals consider when evaluating relocation options.
Although opportunities have been opened for Hong Kong citizens to relocate, there are concerns and challenges that need careful consideration. Financial services professionals in Hong Kong are deeply connected to Asian markets and clients, meaning a move to the UK would require them to start from scratch.
For professionals such as front-office staff, including investment managers and sales traders, their value increases as their networks and market experience in Asia expand. Leaving that behind to start from scratch in the UK would be an incredibly daunting prospect.
Hong Kong is a major private banking hub, managing over $1 trillion in assets. This represents a significant market for private bankers, who are unlikely to relocate unless their clients also move their assets.
Additionally, finance professionals in Hong Kong often have ongoing family and personal commitments, making relocation even more challenging.
Relocation to Singapore
While recruiters have not yet received enquiries about moving to London, they have noticed interest from professionals looking to return to Hong Kong from the US and Europe due to COVID-19. Some expats in Hong Kong are also in discussions with recruiters about relocating to Singapore, though interest in the UK, Europe, and the US remains more limited.
There are instances where UK firms seek professionals with Asian market exposure, but these opportunities are relatively rare. If it came down to a decision, front-office professionals are more likely to consider relocating to Singapore before opting for the UK.
Research before relocation
If finance professionals consider relocating to the UK in the future, they will weigh the comparative strengths of the London and Hong Kong job markets. Key factors include how the national security law is affecting Hong Kong's status as a financial hub and whether China's efforts to integrate Hong Kong into the Greater Bay Area initiative are benefiting the banking sector. These considerations will play a crucial role in their decision-making process.
Hong Kong job market will recover more quickly than in London. Before you decide to make a relocation decision, make sure you have done enough research and speak to market experts. Selby Jennings has 14 offices across the globe. Speak to us to understand more about the market.
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