CLSA’s decision to boost its headcount and reverse its recent pay reductions reflects an improving recruitment market in the Asian brokerage sector.

The firm is adding about 200 people in 2010, mainly in Asia, to tap growth in equity commissions and advisory business. At the end of this month it will pay about 500 senior staff the wages they lost following salary cuts made in January.

And from October, its 1,350 employees are also eligible to receive a 10 per cent monthly pay increase if the firm’s cost-to-income ratio reaches 70 per cent or less.

While CLSA’s salaries still don’t match those of investment banks, these new pay policies should help starve off the threat of disgruntled employees jumping ship as the employment market picks up, according to one headhunter who asked not to be named.

“CLSA has always had a solid business model, so it’s not surprising that it’s turned the corner so quickly and is doing all this to keep its people happy,” he adds.

Recruiters say other brokerages, such as Cantor Fitzgerald, have also started to increase hiring.

“Brokerage recruitment hasn’t hit the headlines yet like it has for the banks. But they are starting to hire again, so that they have enough resources to cope with a growth in transaction volumes,” comments Patrick Tan, a director at Global Search Partners.

The financial crisis has changed the focus of hiring at the banks – senior leaders are now needed to help get firms get back on their feet. But brokerages have not suffered as much as their banking counterparts, hence CLSA could get away with pay cuts at the height of the financial crisis and didn’t need to make triple-figure redundancies.

“While banks have chopped and changed at the top, senior-management teams at many brokerages have stayed comparatively stable, so many of their current vacancies are for mid-level jobs, rather than business heads,” says Tan.

Another difference between banks and brokers is that the later are recruiting more heavily in the back office. “With their revenue-generating workforce largely in place, brokerages need to recruit for operations jobs in order to process the new deals being done in the front office,” adds Tan.