As Predicted, The HK / China Mini Hiring Boom Has Begun

Robert here. As we have been predicted would happen in past posts, a sizzling biglaw US associate lateral hiring boom has arrived in Hong Kong / China for the first quarter ’11. We expect this hiring boom to continue until spring, with hiring being steady afterwards but dropping to more normal levels.

A “perfect storm” has developed, causing many US and UK firms in Hong Kong / China to have multiple US corporate / cap markets urgent openings at one time now.

interviewA lot of these top firms in Hong Kong / China have been understaffed since late 2009. When the global recession went into full swing in late 2008, the downturn had started to seriously affect biglaw deal flow in China (about a year after negative effects were felt in US and other Western markets), with IPOs coming to a stop. There was misguided concern at the time that because China had some dependence on US exports for its economy to be fully fueled, China would be heading into a bubble-busting down turn, even much worse than what was taking place in the US. However, in mid-’09, deal flow in China was booming again, fueled in large part by China’s own consumer economy expanding rapidly. This was no surprise to many of us who have observed China for several years. After all, 2009 was the year that China over took the US in new cars purchased annually, China overtook India in gold purchased annually, and the Asia Pacific Region overtook North America in daily commercial flights.

But much of the world was skeptical the boom could continue more than a short time (dramatic bubble-busting predictions sold newspapers and perhaps made some Westerners feel better about themselves) and thus senior firm management at many firms were reluctant to invest heavily with new hires in China, especially considering the recession in West. With the worst recession of our lifetime in full swing, most US firms were on a global hiring freeze and trying to avoid more layoffs, rather than trying to hire laterals for China. The feeling was also that if there was a need to staff up on some deals in China, it could be done by sending over associates not busy in US, at least temporarily, which was a band-aid on what was becoming an understaffing problem. Further, it was just bad internal politics back them for a partner at a US firm in Asia or elsewhere to try to pressure their management for lateral hires because of the big push in ’09 to keep down costs and try to salvage profit numbers (to help recruit and retain partners) in the midst of a major recession.

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Tags:  Asia | Hong Kong

Be Careful With Cold-Callers

Robert here. If you are a transactional associate at a top US firm and your name happens to be of Asian origin, especially of Chinese background, then you are probably receiving multiple cold calls per day from recruiters. After all the Asia lateral biglaw markets, especially HK / China are red hot now and it is of course very easy to compile a list of top US firm associates with Asian names.

economyKeep in mind that there can be very negative consequences in giving control of such an important career move and job search to someone calling you out of the blue (no matter how many times they may call). We often get calls from very well qualified US associates with sad tales of at worst their resume being plastered unauthorized all over China or other Asia markets; or at best only authorized submissions (thankfully) but realizing their recruiter has done little more than emailing their resume to begin with and is unresponsive for weeks.

It is important to note that your resume is a very valuable commodity to recruiters calling you. When you are placed at a law firm, the recruiter who submitted your resume is typically paid (by the law firm) 25 to 30% of your starting base salary. Thus, the recruiters cold-calling you have a big incentive to get a hold of your resume and email it to law firms, with or without your authorization (believe it or not, some biglaw recruiters in Asia are known to be even less ethical than the worst of the lot in the US). Once your resume has been submitted to a law firm, the recruiter who did so “owns” your candidacy there for at least six months. Further, when your resume has been submitted without your authorization, it will take an affidavit from you to the target firm explaining such for the submission to be reversed (and basically that is you explaining to the firm that you did not know you even applied there, which can of course cool off any motivation of that firm to continue to want to interview you, and the unethical recruiter is counting on you to thus not take that route).

We try to think that a lot of recruiters do not take such unethical steps, but please note that even the most well-intentioned recruiters trying to break into the Asia markets are more often than not woefully inexperienced with such lateral placements (and even most of those with some experience have never been more than resume pushers).

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Tags:  Asia | Hong Kong

Why Kinney Dominates Market Share of US Associate Placements in HK / China; Recent HK / China Placements

Robert here. Robert Kinney and I just returned from another China trip and we will post market notes from that trip shortly at our blog, theasiachronicles.com.

interviewAs you know, we are often quoted and / or featured in various industry publications regarding our US biglaw attorney recruiting and market expertise in Asia. This month, find us in the cover story of the latest California Lawyer magazine. Also, if you don’t mind plucking down the 295 sterling for the brand new book, Building A Profitable Practice In Asia, by Robert Sawhney, just published by Ark Group, you will notice that Robert, Alexis and I were asked to write Chapter 22 (“Staffing an Asia Practice – Recent History and Trends”).

On our recent China trip (we are in Hong Kong / China about every other month and several times a year in other Asia markets), as usual, we were often asked by senior partners at US and UK firms how exactly do we manage to place the majority of their US associate lateral hires and in general represent so many of the top US trained candidates on the market.

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Tags:  Asia | Hong Kong

Expat Allowances are Going Up at the Top End in HK / China

Robert here. Please note that Robert Kinney and I will be back in Hong Kong all next week for meetings. Although our schedule is tight, we can fit in some meetings with prospective biglaw or in-house candidates. Feel free to reach out to us at .

expatIn just the past few weeks, we have seen a noticeable rise in the expat / cola allowances for US associates at some of the most competitive group of US and UK firms in HK / China. In fact , it appears that for the first time $80,000 may be taking hold as the eventual standard in HK / China. For the past several years, while there were anywhere from zero to four firms paying as much as $80,000 expat / cola for associates with no children, most of the top US and UK firms remained in the $60,000 to $65,000 allowance range. The competitive range continues to be $60,000 to $80,000, but more firms are at the top of that range than ever before in HK / China. Further, two top US firms pay $90,000 expat / cola (although one of those has tax equalization on the base).

While there has been already a trend in ‘10 for a number of the US and UK firms with less competitive expat / cola allowances to step it up (see http://www.theasiachronicles.com/archives/2264), there has until very recently not been much movement in the competitive group, most of which have allowances in the mid $60,000’s (keep in mind that many major US and UK firms are still not in that competitive expat allowance range of $60,000 plus, but the size of that group is becoming smaller).

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Tags:  Hong Kong

VERY HOT LATERAL MARKET CONTINUES IN ASIA – OPENINGS LISTED HERE

Robert here. It continues to be a very busy year for lateral biglaw associate and partner hiring in Hong Kong / China. Further we have noticed that in HK, BJ and SHG there is more enthusiasm coming from US, UK and PRC firm partners, regarding the market, than we have seen since mid ’07. You can tell a big difference in enthusiasm by simply going to meetings in firm offices in those markets. Earlier this year, while it was a boom, there was optimism, but much more cautioned and guarded. Sure, the IPO boom at its current pace in China is not sustainable forever, but there is much less concern of a bubble burst or other type of economic downturn. Frankly, Hong Kong has become the market of choice for many major international companies and banks to have IPOs, with many choosing HK over NYC and London. Needless to say, US firms are going to be in and expand in HK / China for a long time. Offices are turning from outposts to much more substantial and strategic parts of US firms, globally.

Our Asia team is so busy, we have fallen behind on fully launching our new theasiachronicles.com blog and we apologize for that. Starting this weekend, we will have daily original posts, as promised (to go along with the numerous daily biglaw asia news posts).

For our readers in NYC who would like to meet us, please note that Robert and I will be in NYC again October 20 to 22. I will be back in China in a few weeks for meetings, as well as trying to catch the last days of the World Expo in Shanghai. Alexis is of course based in Hong Kong and Yuliya is based in Russia (not really Asia, but part of our Asia team nonetheless).

Of course this is the time of year when our 2L law student readers are choosing where to summer. If you would like to talk about your firm choices, with regards to the firms’ Asia practices and offices, we are happy to speak with you. Feel free to reach out any time.

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Tags:  Asia | Hong Kong

Biglaw Hiring Trends in Asia

HK Local Practices Being Built at US Firms

The growing importance of Hong Kong as not only a gateway to China and Southeast Asia, but also as a regional financial center in its own right, has compelled many foreign firms to add a Hong Kong local practice. For the last two years, Hong Kong has been the world’s leading IPO center (surpassing New York and London) and clients are increasingly seeking one firm to handle both the US and Hong Kong side of the IPO. Even General Motors was reported to have seriously considered a Hong Kong listing along with its planned NYSE/Toronto listings, only to drop the idea in part because of Hong Kong’s more restrictive listing requirements. Hong Kong is already the preferred market for international share offerings by China’s behemoth state-owned enterprises, which previously might have considered listing in Europe or the US.

Not all US firms will see an immediate need to acquire a Hong Kong practice as long as they continue to land major deals because of the participation of their US clients (mainly US-based financial institutions) in Asia-based transactions. Yet, as long as Hong Kong continues to be the world’s IPO leader and Asia continues its financial dominance, there will be pressure on foreign firms to add a Hong Kong arm to their practice.

Furthermore, a US firm adding a Hong Kong practice to an already strong US law practice is a throwing down of the gauntlet, so to speak – a signal to the more-established Magic Circle firms that they are committed to Asia and intend to be “all in” as a major regional player. In response, some British firms in Hong Kong have recently invested heavily in expanding their already strong US practice in Hong Kong, with Allen & Overy being a perfect example

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Tags:  Asia | Hong Kong

Golden Opportunities for Native Chinese Senior Cap Markets Associates

Robert here. Senior cap markets associates at top US firms who are native Chinese have never been as marketable in HK / China as they are today. While such persons have over the past five years always had attractive HK /China options at US and UK firms, as well as in-house, in ’10 we have seen these opportunities expand and improve (more clear shot to partner opportunities than usual) significantly. Further, this may be a relatively small window of time, one to two years perhaps, where these clear shot to partner positions are available in such relative abundance (a handful available at one time, versus zero to one usually at any given time).

slammedTo clarify, a clear shot to partner opportunity is one where a business case already exists at a new hire’s new firm for that person to make equity partner. In other words, there is already an equity partner slot open and pegged for such new hire. Of course the senior associate / counsel / salary partner will have to perform, but there is already plenty of deals for that person to execute and the only variable (baring a catastrophe in the market) to making equity partner is that person’s performance, rather than the many variables outside of one’s control that almost always come into play for equity partner promotion (even in the most realistic and strong partnership tracks, there is most usually not already a business case for a new hire to make partner before he / she joins the firm and the business case can be in part made by the new hire’s performance, but also even more usually relies on supervising partners’ and / or new hire’s ability to expand the current practice).

There are a growing number of US cap markets practices in HK / China that have very strong deal flow (emanating from the IPO boom over the past year in HK / China), but are missing a senior native Chinese associate / counsel / junior partner to both execute deals and maintain existing client relations. In many cases in HK / China, top US cap markets groups do not have Chinese partners and although such groups’ partners are market leaders and deal makers, they could use a rising senior associate / counsel to lean on who happens to be native Chinese. The candidates that fill such roles today are being handed one of the leading keys to their new firm’s China practice, in that they are being given both the deals to execute and a leading role in the existing client relations. The former is of course a pre-requisite to having partnership and top in-house senior roles, but the latter is a rare special opportunity that gives a rising attorney a lot of leverage both in the market at large and at his / her current firm. As top US firms are building HK practices and top UK firms are expanding US practices, having a stellar native Chinese senior US associate / counsel on board is more important today than ever before.

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Tags:  Asia | Hong Kong

You Can’t Go Home Again. Or, Can You?

One question I often get from candidates is how easy it will be to return back to the States after spending a few years in Asia.  It’s a valid question – while an Asia-based practice and a US-based practice share many similarities, it’s not a completely overlapping skill set.  Many hiring partners express a strong preference for candidates with Asia experience not simply because of the “regional ties” factor, but because an M&A/FDI deal run out of China has its own unique issues.  There is a learning curve, and a US-based M&A associate unfamiliar with Asia deals will be at the bottom of that curve.  I occasionally encounter a law firm which will take a class year off of an impressive candidate with top credentials because such candidate lacks Asia-specific experience.

The skill set overlap is an issue for capital markets practices as well, although it’s not typically an issue in hiring.  Many law firms in Asia focus exclusively on unregistered (Regulation S/144A) offerings, whereas capital markets practices in the US focus mainly on registered offerings.  There’s a large chunk of that securities redbook that you’re leaving unthumbed if all of your deals are unregistered offerings!  There are certain kinds of capital markets transactions that you just won’t get much of in the US.  A typical domestic capital markets practice won’t see many Islamic bond offerings or sovereign debt offerings, but these types of transactions could be very common in a Singapore capital markets practice.

After spending a few years in Asia doing Asia transactions it’s natural to think that your US-specific skill set would fall into disrepair, but US firms don’t see things that way.   In a warm economy it is easy to move from Asia back to the States, especially if the move is from Asia Biglaw back to US Biglaw.   In 2007 and 2008, we helped a number of US associates in Asia move back to their desired markets in the US.

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Tags:  Asia | Hong Kong

State of the Lateral Market – Korea Practices

While Korea practices, mostly based in Hong Kong, have been busy over the past year and in some cases even quite understaffed, there is not much hiring going of US associates with Korean background.  We recently made a couple such placements at top 10 US firms in HK, one class of ’07 and one ’08, and appear close on another ’08 and an ‘05.  However, there are many more very well qualified Korean US associates on the market in Asia than there are openings.  Further, firms that do have needs in this area are moving very slow to make hires, sometimes waiting months to complete an interview process.

Part of the reason is because firms have so much leverage in the lateral hiring market, due to the large number of native Korean US associates seeking to lateral at present from top US firms in NYC to Asia.  The other main reason is that many of the top US and UK firms in Asia, while off hiring freezes months ago, still do not have the full green light to hire all the US associates they need.  When firm management back in US or UK is only allowing one or two US associate hires in HK, for example, those offices are hiring the biggest area of need – native Chinese US cap markets associates.

We are predicting that there will be more hiring US associate hiring in Korea practices in late ’10 and early ’11 than the first half of ’10.   There will also be more hiring of Korean native US associates at firms in HK that do not have a Korean practice, per se, but have a strong need for an associate or two with Korean fluency and ability to work on the ground in Korea for much of the year.  One of our recent ’08 placements fits this description.   Such needs arise as firms have more deal flow out of Korea, but not any Korean native associates.  This type of hire will not be for only Korean deal work, but will be a mix of Korean and Asia markets deal flow, with special responsibilities coming in the Korea work of course.

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Tags:  Asia | Hong Kong

Singapore Nexus

When considering a move to Singapore, it is more important than in other Asia markets that you have some type of credible connection to the city-state.  This would seem ironic, since in Singapore firms routinely hire English-only US associates, so on the surface it would seem the perfect Asia market to target if you do not have an Asian background.

While it may have been true during the ’07 hiring boom that associates without Singapore ties were able to penetrate that market , this is no longer the case.  US and UK firms all over Asia in ‘07 were dealing with a shortage of well-qualified US associate candidates, so even though Singapore was not hiring nearly as much as Hong Kong, Beijing, Shanghai, and Tokyo, it was an easier place to land in ‘07 for someone who had no connection at all to Asia.

Today, things are quite different.  While the number of openings in Asia are once again relatively high (especially in Hong Kong / China and Singapore), there are many more qualified candidates for these positions than there were in ‘07.  A number of our Singapore Biglaw client firms are hiring now, but are being understandably very selective.

One of the key factors our candidates for Singapore are dealing with is the issue of why, exactly, they are moving to Singapore.   Why Singapore, why this particular paradise tropical location?  Unprepared candidates or recruitment consultants are sometimes caught off guard.  Were your parents or grandparents born in Singapore, were you born in Singapore (as Robert was), do you have an aunt in Kuala Lumpur?  Think about what you can come up with in terms of nexus before contacting us, let alone sitting for an interview.

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Tags:  Asia | Hong Kong

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