HK mobile apps firms face serious talent shortage: Survey

22 Jun 2017

Facing talent shortage and increased operational costs, nearly half of mobile apps development firms in Hong Kong need to turn down their business deals or outsource services to overseas, according to a recent survey conducted by the Wireless Technology Industry Association (WTIA).

The WTIA’s Hong Kong Mobile Apps Industry Survey, conducted by Hong Kong Productivity Council (HKPC), interviewed 124 app development companies firms between May 8 and June 5 this year.

According to the survey, 33% of the companies said they are facing a serious shortage of manpower with technical talents such as programmers, coders and engineers being the most difficult to fill.

“There is a major talent shortage not just on the technical side, but also in sales,” said Wendy Alison Yung, executive director at WTIA.

Another key challenge is an increase in operational costs, with a majority (86%) of the companies saying facing increasing pressure from high staff costs while 55% from office rental.

To address the issues of talent shortage and increased operational costs, 42% of the companies said they have to use outsourced services, with domestic companies being the most popular choice (69%), followed by firms in mainland China (25%) and other countries or regions (21%).

Despite these challenges, the survey found that the mobile app industry in Hong Kong is getting mature with a better business prospect.

For one, the number of respondents with an annual revenue of HK$500,000 ($64,000) grew by 28%. At the same time, the number of companies in deficit reduced by 14%. These figures suggest a better business environment and prospects for a growing in the smartphone app industry, Yung said.

Meanwhile, the number of companies operating for six or more years has drastically increased from 22% last year to 50% this year, while startups have also become considerably more well-established with an increase in founders aged 25 and above (23%) and in founders with five or more years of work experience (13%).

Business applications (57%) tops the most popular app products this year followed by e-commerce applications (26%). Over four-fifths (82%) of the respondents allocated resources to R&D and product development in the previous year, with the average amount at over HK$2.1 million.

Following the global success of the popular augmented reality (AR) game “Pokemon Go” and the introduction of NFC e-payment services in Hong Kong, the survey showed that AR and NFC are the most popular technologies being adopted in mobile apps in the city.

According to the survey, 22% of mobile apps created feature AR in 2017, up from 9% the previous year, while adoption of NFC has increased to 21% this year from 10% in 2016.

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