Startup salaries cool in 2023 with junior engineering roles seeing the sharpest decline of 6 percent, Glints and Monk’s Hill Ventures (MHV) revealed on Thursday.
According to the Southeast Asia Startup Talent Trends Report 2024, off the back of tech layoffs and cost-cutting measures, junior tech roles have been most impacted across the region with salary declines across the region.
However, most senior tech roles saw steady growth year on year such as 2 percent to 3 percent increases for senior engineer roles.
The report also showed business development and sales salaries spike with increases of up to 20 percent.
It is noted that revenue-generating roles continue to take center stage.
The business development and sales function experienced high salary increases (+14 percent on average for roles in Singapore), reflecting a heightened emphasis on achieving profitability in 2023.
Meanwhile, despite layoffs and salaries cooling, demand for tech talent remains high across markets amid increased supply.
Due to tech layoffs, the market has seen a notable increase in the availability of junior roles, particularly within engineering sectors, leading to a higher supply of candidates.
This influx has resulted in a downward adjustment of salaries across various positions.
However, senior talent, such as Vice Presidents (VPs) of Engineering, remains competitive, highlighting the continued demand for highly skilled individuals.
The report also showed Southeast Asia founders adopting artificial intelligence (AI) in the near term are prioritizing efficiency gains.
Startups are focusing on automating admin tasks, content creation, and customer service, with a strong emphasis on streamlining operations.
Soft skills such as critical thinking and creative thinking are increasingly prioritized due to a tightened market and an emerging AI-centric landscape.
Additionally, for a growing number of founders, proficiency in AI tools is emerging as a basic requirement for both tech and non-tech roles, akin to the use of email or Excel.
According to the report, AI is boosting productivity in the workplace, yet jobs remain secure.
Founders recognize employee concerns about job displacement as a key obstacle in AI adoption in the workplace, yet, these fears have not materialized in practice.
The report also showed cross-border hiring is gaining momentum as a strategy to improve cost-effectiveness and enhance profitability.
70 percent of the survey respondents plan to increase cross-border hires this year.
Additionally, startups are increasingly looking for regional talent to diversify their teams and find specialized skills, aiming to enhance cost-effectiveness and boost profitability.
The report also showed hybrid work is rising as startups prioritize flexibility to retain talent.
Flexible work arrangements, including hybrid models, are trending at the top of startups’ strategies for retaining talent.
This move towards hybrid work, balancing operational efficiency with employees’ growing demand for flexibility, is expected to persist into 2024.
“The past year’s challenges in a tightened market have highlighted a greater need for adaptability and resilience,” Oswald Yeo, CoFounder and Chief Executive Officer of Glints.
Looking ahead, he said the increasing value placed on soft skills alongside technical expertise signifies a shift towards cultivating a workforce that is not only versatile but also AI-fluent.
Additionally, he said the rise in cross-border hiring reflects a strategic response to these changing dynamics, broadening the talent pool and fostering diversity while enhancing cost competitiveness and improving profitability.
“When envisioning the future of work, it’s critical to seize AI opportunities while also adhering to fundamentals when it comes to hiring: attracting top talent and building cohesive, high-performing teams, regardless of how the workplace continues to evolve,” he added.
Peng T. Ong, CoFounder and Managing Partner of Monk’s Hill Ventures, said that AI has the power to transform businesses.
“By leveraging AI to develop deeper relationships with customers, businesses can harness opportunities to offer greater value,” he said.
According to him, the application of AI in Southeast Asia is relatively nascent compared to the United States, which presents an opportunity for them to grow their understanding, and identify impactful areas of adoption to build world-class businesses.
“We partnered with Glints on this report to empower the ecosystem with practical insights, so companies can build better strategies and better structure their teams to tap into the rise of AI to turbo-charge businesses,” he added.
Cheryl Liew, Head of Talent of Monk’s Hill Ventures, further noted that scaling their startup goes beyond just adding people to the team.
“Founders need to think carefully about reaching prioritized goals, whether that’s through refining processes, improving teamwork, or bringing in new talent with the right skills,
“The silver lining is, if your startup shows discipline, growth, and strong leadership, you’ll stand a better chance of attracting the right hires,” she added.
The third iteration of the report provides a deeper dive into hiring trends, salary and equity data for founders and C-suites, and startup talent from over 10,000 data points, 183 C-suites and founder data points, and 72 interviews with startup founders and operators across Singapore, Indonesia, Vietnam, and Taiwan.
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