Back to BlogHow to cut costs and improve hiring efficiency in Asia without compromising quality
Asia’s recruitment landscape is in flux. Economic growth, digitalisation, and shifting workforce demands, these all factor in. Countries like the Philippines are seeing rapid hiring growth, with a 20% annual increase, while others, such as Japan and Thailand, are grappling with acute skill shortages. Meanwhile, 88% of employers in Japan face talent shortages, while Thailand cites skills shortages, particularly in occupations that require specific technical skills.
The rise of remote and hybrid work, now preferred by 90% of employees in Asia Pacific, adds another layer of complexity. Traditional recruitment methods are proving too slow and costly in this environment.
To stay competitive, businesses must adopt efficient hiring practices. This means streamlined, tech-enabled processes that boost hiring efficiency without compromising talent quality. Let’s explore the practical strategies you can implement to reduce costs and improve outcomes across Asia’s diverse markets.
The pressure to scale quickly and cost-effectively
Businesses across Asia are under increasing pressure to scale their teams while keeping recruitment costs in check.
Several key factors drive both the urgency and volume of hiring. For example, sectors like fintech, eCommerce, and AI are growing at a fast pace—businesses in these industries find themselves hiring from different countries as they expand.
Startup growth and funding rounds also require rapid team expansion to keep up with demands and expectations. They must start fast—and keep going. The regional expansion of global firms is also emerging in Southeast Asian markets, thereby increasing the demand for top talent in the region.
Shifting workforce expectations, including flexible work arrangements, are also influencing how companies scale. Additionally, with demographic changes and a younger workforce entering the job market, businesses may need to adapt quickly to minimise turnover.
Market competitiveness in APAC
The Asia-Pacific region is experiencing a surge in demand for talent amid economic expansion and digital innovation.
- In 2025, 46% of companies in Asia plan to increase headcount, with Japan leading at 56%, which reflects growing business confidence. At the same time, 62% of organisations report moderate to severe skill shortages, especially in Japan and Thailand.
- Labour markets are especially tight in cities like Singapore, where there were 1.64 job vacancies per unemployed person in late 2024 (up from 61,500 to 77,500 vacancies in just three months). Meanwhile, 57% of professionals in Singapore are actively job-hunting in 2025. This mirrors a regional average of 55%, underscoring high turnover and intense competition.
- Tech-driven job growth is also accelerating, with major demand surges in India, Taiwan, China, and Singapore, fueled by investments in AI and digital infrastructure.
In this fast-moving environment, hiring efficiency is essential. Organisations that invest in efficient hiring practices stand a better chance of securing top talent quickly and sustainably.
What is hiring efficiency and why does it matter?
Hiring efficiency refers to how effectively an organisation attracts, evaluates, and secures the right candidates using minimal time and resources. It goes beyond just filling roles; it reflects how well a company aligns its hiring practices with business goals.
When efficient hiring is prioritised, businesses benefit from reduced recruitment costs, shorter vacancy periods, higher quality hires, and improved retention and onboarding success.
When we talk about hiring efficiency, it’s not just about finding the right people for the correct positions. It’s achieving a balance in the entire human resource management ecosystem—finding the right talent for critical roles which will empower both the individual and the company to grow.
Key hiring efficiency metrics to track
To measure and improve hiring efficiency, it’s essential to monitor the right data. Core metrics include:
- Cost per hire: Total recruitment expenses divided by the number of hires
- Time-to-fill: Average number of days to fill an open position
- Offer acceptance rate: Percentage of candidates who accept the job offer
- Candidate satisfaction: Feedback and experience throughout the process
Barriers to efficient hiring in Asia
Establishing a legal entity in an Asian country can be both financially and operationally burdensome, particularly for businesses aiming to hire a small team or test new markets.
Additionally, navigating the diverse and often inconsistent employment laws across Asian countries also presents significant challenges.
High costs of setting up a local entity
These factors can impede efficient hiring, especially when businesses need to scale quickly and cost-effectively:
- Registration and licensing fees: In Vietnam, for example, setting up a limited liability company can cost approximately above USD 15,000, covering incorporation, bank account setup, legal office, and government fees.
- Administrative complexity: The process often involves intricate paperwork, local representation, banking arrangements, and ongoing tax filings, which can be time-consuming and costly.
- Time investment: Establishing a local entity can take several months, which may delay market entry and talent acquisition.
Complex and inconsistent employment laws
These complexities can hinder hiring efficiency, making it challenging for HR teams to maintain compliance while recruiting across multiple jurisdictions:
- Varied regulations: Each country has its own set of labour laws. For instance, Singapore’s Employment Act differs significantly from Malaysia’s Employment Act 1955, affecting wage protections, rest days, and termination protocols.
- Multi-state compliance: In India, labour is a concurrent subject under the Constitution, allowing both Central and State governments to legislate. This results in businesses needing over 22 approvals and facing inspections from more than 19 authorities, often without prior notice.
- Risk of non-compliance: Misclassifying employees or failing to adhere to local regulations can lead to hefty fines, legal repercussions, and damage to the company reputation.
Overburdened internal HR teams
Internal HR departments often face significant strain and pressure, which can impact their ability to execute efficient hiring strategies:
- Administrative overload: HR professionals in the Asia-Pacific region report spending extensive time on administrative tasks, with 24% dedicating three to five hours daily to reviewing applications. For companies that operate in various countries or hire remote workers, HR teams must also stay on top of the latest legal updates regarding taxation, mandated benefits, and payroll.
- Talent shortages: A significant 61% of HR professionals in APAC have found it increasingly difficult to find qualified talent, intensifying the workload and stress on HR teams. Especially when scaling globally, there are numerous factors to consider when recruiting.
- Resource constraints: Limited resources and support can lead to burnout and decreased productivity among HR staff, further impeding hiring efficiency.
Solution spotlight: Employer of Record (EOR)
While the barriers may seem daunting, innovative workforce solutions, such as CXC’s Employer of Record (EoR) services, have emerged as a practical alternative, enabling companies to navigate these challenges with greater agility and confidence.
What is an EOR and how does it work?
An EoR is a third-party organisation that legally employs workers on behalf of another company. This allows businesses to hire talent in new countries without the need to establish a local legal entity.
EoR vs. local entity setup
Unlike setting up a subsidiary or branch office (which can take months and involve significant legal, financial, and administrative burdens), an EoR enables companies to begin operations almost immediately.
The EoR becomes the legal employer in the region, while the hiring company retains full control over day-to-day management and work responsibilities of the talent.
Core functions of an EoR:
- Hiring and onboarding: An EoR can take charge of managing contracts, documentation, and local employment requirements. As a result, internal HR teams can focus on other tasks, such as conducting actual interviews or devising ways to increase employee retention and satisfaction.
- Payroll and taxation: EoRs process compliant salary payments, benefits, and statutory contributions. If there are any changes in the region or country’s laws, the EoR keeps the hiring company updated.
- Compliance and risk mitigation: EoRs are responsible for ensuring adherence to local labour laws. This is a very critical role, as hiring companies are usually not familiar with local laws when expanding to a new area for the first time. Research and studying may take too much time and delay their plans to scale.
Key benefits of using an EoR in Asia
Partnering with an EoR offers a range of advantages for businesses expanding across Asia.
Hiring timelines can drastically accelerate, and companies can launch operations and onboard employees in new markets in days, not months. This enables them to be more efficient, as they can focus on core tasks such as training and establishing team culture, while the EoR handles documentation, legal requirements, and contracts.
Operational costs can also be reduced. Companies can avoid significant capital outlays and ongoing overhead ties to entity maintenance. When it comes to regulatory compliance, EoRs are experts at navigating varying labour laws to help global companies avoid legal pitfalls.
Working with an EoR essentially simplifies HR administration. They help free up internal teams to focus on strategy and employee engagement. This, in turn, makes scaling more seamless and flexible, as companies can easily expand or contract their workforce size based on evolving market needs.
Real-world use case: How CXC transformed the Philippines into a talent hub for a leading global company
A leading property and casualty insurer set out to establish its first Centre of Excellence (CoE) in the Philippines, focusing on IT and insurance operations.
With plans to grow from one employee to 800 by 2025, the company faced several challenges, including limited internal talent acquisition capacity, fragmented vendor support, and difficulty in sourcing mid-to-senior-level IT talent.
CXC stepped in with a tailored, data-driven solution. In just seven months, CXC filled 24 permanent roles, maintained a steady talent pipeline, and established real-time collaboration tools with the client’s team.
The result was rapid CoE growth, improved employer branding, cost-effective talent relocation, and long-term retention. The success of this partnership has positioned the Philippines as a strategic hub for the client’s global operations, with CXC now playing a key role in its continued expansion.
You can check the full success story here.
Complementary strategies for smarter hiring
1. Contingent hiring for workforce flexibility
Hiring contingent workers (such as freelancers, contractors, and project-based professionals) offers companies a cost-effective way to meet shifting talent demands without long-term commitments.
Use cases include short-term project execution (such as product launches and tech rollouts), scaling teams seasonally or during funding rounds, and accessing niche expertise without full-time overhead.
Cost-benefit advantage:
Freelancers and contract workers often reduce total employment costs by up to 30%, as businesses avoid expenses like full-time benefits, insurance, and statutory contributions.
2. Offshoring to tap emerging talent hubs
Offshoring continues to be a powerful way to balance quality with cost in Asia—especially when leveraging the region’s emerging tech and service talent pools.
Top offshoring destinations include:
- India: World-leading IT and software talent with strong English proficiency
- Philippines: Robust BPO and customer support sector, culturally aligned with Western markets
- Vietnam: Fast-growing tech scene, particularly in app development and QA, with increasing foreign investment in digital upskilling
These markets offer not just cost savings, but also tech-readiness, infrastructure, and workforce scalability. Companies that strategically offshore roles can significantly enhance efficient hiring while maintaining performance and quality standards.
3. Internal recruitment and talent pipelines
Promoting from within and reassigning talent across regions can be one of the most overlooked yet powerful strategies for hiring efficiency.
Strategic advantages include:
- Faster onboarding and cultural alignment
- Lower recruitment costs and improved retention
- Stronger employee engagement and succession planning
Cross-border mobility is also gaining traction, particularly in multinational firms with established operations in Asia. Companies that encourage regional rotations or redeploy talent across markets gain agility and deepen organisational knowledge (which are key traits for long-term workforce success).
Technology-driven recruitment optimisation
From AI-powered tools to data-driven strategies, businesses across Asia are embracing digital solutions to reduce time-to-hire, enhance candidate experiences, and make smarter recruitment decisions. Here’s how technology is reshaping hiring efficiency in the region.
How AI can improve hiring efficiency
AI can streamline some of the most time-consuming stages of the recruitment process, allowing HR teams to focus on higher-value tasks.
- CV or resume parsing: Instantly extracts and ranks relevant qualifications, reducing manual screening time
- Smart filters: Uses machine learning to shortlist high-fit candidates based on job criteria and previous hiring patterns
- Scheduling bots: Automatically coordinate interviews based on availability, removing unnecessary back-and-forth
Improving the candidate experience with automation
Automation enhances not only recruiter productivity but also the overall candidate journey. Automated communications, for example, keep candidates informed at each stage, reducing drop-offs and boosting engagement. With real-time feedback loops, teams can automatically deliver updates and results, improving transparency. Meanwhile, self-service scheduling empowers candidates to book or reschedule interviews with ease and minimal back-and-forth.
Using data for better hiring decisions
Harnessing data allows recruiters to refine roles, assess candidate fit more accurately, and drive better long-term outcomes.
Key applications include performance-based hiring, which leverages historical employee success metrics to shape ideal candidate profiles. When it comes to role refinement, data insights can be used to align job descriptions with actual needs, reducing mismatches and turnover.
Avoiding common pitfalls in Asian hiring
Understanding common pitfalls (especially those related to compliance and operations) is essential for maintaining momentum and avoiding costly setbacks. Here are two key areas where organisations often falter.
Legal and compliance risks
As mentioned earlier, labour laws across Asia can vary widely not only between countries but sometimes within them. This makes compliance a significant risk area for expanding businesses. Common legal pitfalls include:
- Employee risk misclassification: Treating full-time workers as independent contractors to bypass taxes and benefits can lead to penalties and backpay liabilities
- Benefits mismanagement: Failing to provide country-specific statutory entitlements (such as mandatory bonuses, leave entitlements, social insurance) may result in lawsuits or fines
Administrative inefficiencies
Behind the scenes, operational issues can quietly erode the effectiveness of even the most ambitious hiring plans. Key issues include:
- Outdated or inconsistent payroll systems: Errors or delays in salary payments lead to dissatisfaction and high attrition
- Fragmented onboarding process: Lack of standardisation across markets creates confusion, lowers engagement, and delays productivity
Success stories: Smarter hiring in action
The following real-world examples demonstrate how companies can utilise EoR solutions to overcome common hiring challenges, resulting in rapid expansion and improved hiring efficiency.
Example 1: Scaling fast with EOR across Southeast Asia
A multinational company aiming to expand its operations in Southeast Asia rapidly may face tight deadlines and unfamiliar local regulations. Working with an EoR will help them achieve the following outcomes:
- Time-to-hire can be cut from eight weeks to just two, enabling the business to fill critical roles faster
- Legal entity setup can be bypassed entirely, reducing both overhead costs and administrative delays
- Compliance can be managed centrally, allowing local teams to focus on operational execution
This approach enabled the company to quickly bridge the IT and manufacturing talent gaps, accelerating growth while maintaining hiring efficiency.
You can view a similar success story here, where an HVAC company achieved similar outcomes thanks to enlisting the aid of CXC’s EoR solutions.
Example 2: Expanding without a local entity
A growing technology startup that wants to explore new APAC markets may lack the resources to establish a legal presence in each country. Instead of waiting months for entity setup, they may opt to hire through an EoR model to test the waters. Examples of key outcomes include:
- Hiring talent without setting up a local office, which enables rapid market entry
- Testing product market fit and building partnerships with minimal operational risk
- Ensuring legal compliance from day one, avoiding common regulatory missteps
The startup can gain valuable market insights and build early traction (without long-term commitment or cost-heavy infrastructure) by using this model, greatly enhancing its hiring efficiency.
This case also shares a similar CXC success story, which can be viewed here. CXC’s client sought to expand into Southeast Asia during the pandemic, despite having a limited local presence, and still achieved similar outcomes.
Next steps for smarter hiring across Asia
To compete and grow in Asia’s dynamic hiring landscape, companies must prioritise hiring efficiency without sacrificing quality. Here’s a summary of the practical strategies you need for achieving efficient hiring across borders and at scale:
- Use an EoR for fast, compliance market entry without the burden of setting up local entities
- Automate recruitment workflows with AI-driven tools to streamline screening, scheduling, and communication
- Build internal talent pipelines through internal mobility, contingent hiring, and offshoring to key talent hubs
When must you engage an expert?
If your business is entering new markets, ramping up headcount, or struggling with regulatory compliance, it may be time to consult a specialist. A clear sign you’re ready to scale is when hiring demand outpaces your internal capacity or regulatory complexity begins to delay onboarding.
To navigate cross-border hiring with confidence, consider partnering with experts like CXC. Built on a foundation of thirty decades of expertise, experience, and passion to serve global businesses, our EoR solutions help businesses streamline hiring, ensure compliance, and unlock new markets without operational delays, so contact us today!
