Talent2 International Limited : Talent2 APAC Market Pulse III Study - 7 March 2013

Media Release | 27 February 2013

Talent2 APAC Market Pulse 3 Study:

APAC Business are Optimistic, but Non-Committal, about Business Growth in 2013 Contractors could be the answer as 55% APAC Businesses don't anticipate to increase their workforce

The majority of APAC businesses predict growth in the next 12 months, however many do not plan to increase their workforce numbers to support intended growth according to The Talent2 APAC Market Pulse 3 Study.
The report finds a strong sense of optimism amongst the majority of APAC businesses, with
61% predicting growth for the next 12 months, and only 5% predicting decline. In Australia, the research shows that whilst more than half (55%) of businesses are forecasting economic
growth in the next 12 months, only 40% expect to increase employee numbers.
This discrepancy could threaten to place great pressure on some companies and their employees and it is expected that as growth occurs without an increase in human resources, APAC businesses will turn to contractors. Businesses in APAC are however already using some growth strategies such as reducing headcount and investment in mature markets (36%) and increasing back-office services through shared service delivery (33%).
Surveying 444 senior business executives across Australia, Hong Kong, Singapore, China, and Malaysia, including 271 in Australia, the study, commissioned by Talent2 and conducted by Galaxy Research, was conducted to understand the level of business economic confidence and its impact on talent and people strategies across APAC, with particular focus on the contractor workforce.
The research reveals that 66% of organisations across APAC currently employ contractors, a figure that is potentially set to grow as unemployment figures rise and job seekers accept contract positions. Senior business executives believe that the majority of contractor roles (60%) are filled because job seekers find it difficult to secure permanent employment.

Whilst awareness of the benefits contractors can offer organisations is high, the research finds there are also challenges. 65% of Australian businesses believe contracted workers increase workforce flexibility and scalability to support economic conditions and 37% feel contractors offer improved business performance by better matching specialist resources to company projects. Despite being aware of the benefits, organisations also cite higher costs (46%) and having a clear method for measuring the performance of contracted workforce suppliers (43%) as the main businesses challenges.

Media Release | 27 February 2013

The research also indicates a decreasing trend in the percentage of permanent full-time staff. In Australia, full-time employees currently represent 73% of its workforce, which is less than Talent2's Market Pulse 2 study in 2011, which indicated that 78% of the Australian workforce was made up of permanent full-time staff.
"It may become increasingly necessary for businesses across APAC to consider the flexibility of a contracted workforce in an oscillating economic climate, rather than resorting to cuts to full- time employees as a reactive profitability measure ," said Caleb Baker, Managing Director, RPO
& Managed Services Asia Pacific, Talent2.
"When unemployment rates rise, the demand for contractors also rise as people who were traditionally used to full time roles begin considering part time or contractor roles. It's clear that whilst businesses are aware of the benefits a contractor workforce can offer, there are perceived barriers to adoption for businesses to overcome in order to consider employing contractors. These barriers can be easily addressed by working with expert providers who can offer ease of management and better visibility of contracted employees," concluded Baker.

Other Research Findings

Key Australian Findings

» 40% of Australian businesses are expecting to increase their workforce in the next 12 months, 24% are expecting to see a decline and 36% do not anticipate any change. With
55% of these businesses expecting economic growth in the next 12 months many believe
they can achieve growth with no increase in the workforce.
» One in three Australian businesses (31%) expect to increase the number of permanent staff and 23% of those that employ contract staff expect an increase in these contingent employees.
» Employing or increasing the number of contracted workers is considered by 41% of senior managers to be one way to help manage the likely future economic climate.

Key APAC Findings

» The key benefit of employing contract workers is perceived to be the increased workforce flexibility and scalability that allows them to better meet economic conditions (61%) and support regional expansion (26%).
» Contract workers also benefit businesses through improved business performance by allowing better matching of specialist resources to company projects (35%). Senior managers also find that using contracted workers makes it easier to gain approval for increased headcount (27%).

» Business managers believe that contract employees benefit from more flexible hours (42%), higher earning power (39%) and more varied work (37%).

Page 2

Media Release | 27 February 2013

» Just as there are benefits to employing contract workers, senior managers acknowledge that they also come with challenges. The main challenge is having a clear method for measuring the performance of their contract workforce suppliers (41%).
» There are also financial challenges, including higher costs (37%) and not knowing if they are getting the most competitive rates (20%).
» It is not uncommon for contract workers to be paid more than permanent workers on a like for like basis. Overall, 39% of senior managers acknowledge this to be the case, with the practice more common in Australia (46%) than elsewhere.

Links & Multimedia

Full report available here

Page 3

For more information, or for a copy of the report, contact:
Elaine McGrath | t + 61 2 9087-6246 | e [e-mail]
Pip Giles | t + 612 9956-5733 | e [e-mail]

About The 'Talent2 APAC Market Pulse Study'

The Study was commissioned by Talent2 and conducted by Galaxy Research across Australia, Singapore, Hong Kong, China, and Malaysia between Thursday 24 January and 4 February
2013. The study was sent out online to Talent2 clients and prospects across a range of sectors and 444 responses were received.

About Talent2

Talent2 is the leading Human Resources Business Process Outsourcing (HR BPO) and Managed Services organisation in the Asia Pacific region, delivering end-to-end talent management solutions that put people first. These include HR Advisory, Payroll, Recruitment, RPO and Learning.

Founded in 2003, Talent2 operates from over 40 offices providing services in 30 countries across Asia Pacific, Middle East, UK and USA.

Media Release | 27 February 2013

In 2012, Talent2 was privatised by its founders, Geoff Morgan and Andrew Banks in partnership with Allegis Group, Inc. Allegis Group, a private company founded in 1983, is the largest staffing provider in North America and the fourth largest staffing firm in the world, with offices in over 300 cities throughout the Americas, Europe, and Asia.

The combined strength of both businesses further cements Talent2's position as a global organisation and gives it a unique capacity and platform to fulfil the rapidly evolving needs for talent management across the globe.

Page 4