SINGAPORE: If you’re considering a career in finance or are already in it and are wondering which hub is a better choice, there are a few factors to consider. Believe it or not, Taylor Swift may even affect your decision, but more on that later.
Earlier this week, a piece in Bloomberg pointed out that Singapore, “the Switzerland of Asia,” has been attracting an influx of wealth from overseas. Funds overseen by the asset management industry have grown to twice its size in six years and are now at around $4 trillion (S$5.45 trillion). High-net-worth and ultra-high-net-worth individuals have been drawn by political and economic stability and low-income tax rates in Singapore, and industry experts are saying the inflow is unlikely to stop anytime soon.
Strict COVID-19 restrictions and fears of restrictions from Beijing even drove a considerable number of finance workers from Hong Kong to Singapore during the early years of the pandemic. Still, some have started to go back to Hong Kong since then, Bloomberg reported.
Moreover, Singapore just kicked Hong Kong off of the number one spot and is now the world’s freest economy, according to a report from Canadian think tank Fraser Institute last month. Hong Kong is now in second place and may even fall further.
Nevertheless, Hong Kong has kept its edge as Asia’s top financial centre, given its relation to China, the second-largest global economy. Hong Kong has the advantage of proximity to China’s US$18 trillion (S$24.5 trillion) economy, compared to Singapore’s relationship to countries in South East Asia, with a combined US$3 trillion (S$4.1 trillion) economy. Small wonder that nearly half of Asia’s edge fund managers are based in Hong Kong.
When it comes to take-home pay, Hong Kong wins. 2022’s eFinancialCareers APAC salary and bonus survey of finance workers in the two cities showed the following: “In Hong Kong finance professionals earn 88 percent more in salary and 4 percent more in bonus than in Singapore, with total compensation 55 percent higher in Hong Kong. Finance professionals in Hong Kong earn average total compensation of US$293,000 (S$400,000), while counterparts in Singapore are paid US$193,000 (S$263,000).”
This higher pay comes with caveats, however. Hong Kong professionals face higher gender wage discrimination and work four hours more a week than Singapore professionals. “In Hong Kong, average female pay is US$128,000 (S$175,000) and men are paid 64 percent more than their female colleagues,” the survey shows.
Cost of Living
Living costs are high in both cities but are higher by 30 percent in Singapore, with the biggest differences in transportation and entertainment. The inflow of cash into Singapore has caused living costs, especially housing, to surge. Inflation in Singapore is also higher than in other countries in the region.
And then there’s Taylor Swift. The pop superstar is making only two stops in Asia for her Eras global tour, Tokyo and Singapore, where she’s playing six shows in a country where less than 6 million people live. Disappointed Swifties in Hong Kong, where the singer performed in 2011, wondered over social media whom to point fingers at why Swift decided to forsake Hong Kong this time.
“The rivalry between the two cities has been sharpened by the US singer’s international tour plans,” noted the Financial Times in July. There has to be a good reason why Swift, whom some call the most influential person in the world at the moment, would choose Singapore and Hong Kong, and the future of finance may have something to do with it. /TISG