Hot Market Curbs Hiring
June 15th, 2006 | by This is China! |-from Suzhou
Yesterday I read in the Financial Times a China article “Wage Inflation in China Hits Hiring”that confirmed feelings I already had and anecdotes I have been hearing about the hiring market in the “hot” economic areas in China. Namely, it’s the employees’ market right now. Requirements for Chinese with technical ability AND experience AND especially English language capability are essentially able to name their price.
The FT article cites the CEO of Manpower, the global recruitment and temporary labor company, as saying, “sought-after staff in the affected sectors were staying as little as 60 days before finding new employers with better wages and conditions.”
A friend of mine had worked very hard as General Manager (GM) of his factory here in Suzhou to retain a talented young staffer. When the staffer was not promoted to the coveted Production Manager position, she bolted to a much larger company to become a manager. Now, she was only 26 as it was, with no management experience; she was bright, and, as seems the case with so many Chinese employees in their twenties and early thirties, impatient to earn high salaries and titles they can show off to their friends and families.
The problem is, the market right now in China is supporting this sort of job hopping. China simply does not have enough talent to support the growth of new businesses. And this is not something that is restricted to Western companies; Chinese companies are suffering as well as they try to grow their businesses and compete against encroaching foreign competition. A friend of mine who is a Chinese manager at a large Chinese company in the travel industry is struggling to find a Chinese who has experience dealing with Beijing government officials and who has experience dealing with foreigners in English language. The biggest trick once the manager finds the individual is to keep the new employee, especially after the employee has the higher salary and new, fancier title to exhibit to prospective suitors.
In our own practice we are down a couple people and are waiting to see how latest re-organization plans will affect our hiring requirements. It takes too much time and energy finding and then working to keep the people, only to have them fly away because business objectives the employee assumed at sign-on changed just as she joins the company.
The article goes on to say that a lot of companies are freezing hiring right now: partly because wages are beginning to get out of control, and partly because it is easier to deal with shortages of staff than with the instability caused by frequent staff turnover.
It seems China is beginning to become a victim of its own success.
