As published on: hubbis.com, Friday 14 July, 2023.
The growing single family office (SFO) sector in Singapore is placing pressure on the country's finance talent pool, leading to an increase in wages for experienced staff. However, the higher profile of the sector is also attracting new joiners.
Family offices in Singapore are experiencing heightened competition for skilled staff, particularly for senior and specialist roles, resulting in upward pressure on wages and making hiring more challenging.
The increased visibility of the sector and the perception that it offers a better work-life balance compared to banking are attracting more entry-level recruits.
Singapore's success in attracting SFOs was highlighted when the Monetary Authority of Singapore (MAS) announced that 1,100 SFOs have received tax perks, nearly tripling the number from 2020. The actual number of SFOs is likely higher, as the MAS only records those that have applied for tax perks, and many more are in the registration queue.
The proliferation of SFOs has strained the local talent pool as these firms seek to staff their operations.
The demand for skilled staff is particularly felt at the C-suite level, where finding suitable senior executives to lead SFOs is becoming increasingly challenging due to the knowledge and experience required to establish and run these businesses.
According to Senior Minister Tharman Shanmugaratnam, SFOs now employ 1,400 Singaporeans and permanent residents in well-paying jobs. The majority of local staff earn above S$5,000 ($3,700) per month.
A survey conducted by KPMG and consultancy Agreus found that CEOs at Asian family offices are typically paid between S$158,000 and S$500,000, while chief investment officers command higher pay, with some earning over S$1 million.
Although Singapore is a regional asset management and banking hub, there is still a talent gap in specialist roles, such as private equity and venture capital. Singapore lags behind other countries in these areas.
However, the rise in family office staff wages is seen as a positive development by industry experts, as it helps attract strong talent. The increased visibility of SFOs has also made the sector more appealing as a career choice, providing an alternative to high-pressure banking careers and offering a long-term decision-making focus.
While competition for entry-level support staff remains relatively low, as family offices are not competing with banks for these professionals, the sector still offers an attractive lifestyle and less stressful work environment.
In summary, the SFO sector in Singapore is facing intensifying competition for skilled staff, leading to higher wages. However, the sector's rising profile and unique work environment continue to attract new talent at the entry level.