A New Kind of Generation Gap in China
May 30th, 2008 | by This is China! |I’m now seeing up-close and personal the Chinese Staff Capabilities Gap I’d heard about two years ago: young Chinese hopping from job to job, title to title, salary increase upon increase in a few short years. Each company believes it is hiring next the super-duper-vice-president-of-you-name-it – despite “Joe Wang” being a mere thirty years old, doubling his salary, and giving him a posh office. In a mere three years Joe has come from being a mere technician to engineer to floor manager to plant manager. His greatest competitive advantage is that he can string two words together in English: enough to impress during interviews. Problem is, Joe doesn’t know squat about the job, has no experience in the area, and has grown lazy from a job market that has been too hot for employers to rationally handle.
The problem for employers, though, is that the market still favors employees, and employers – whether through their own auspices or through recruitment agencies – are bidding up the salaries of these walking empty vessels.
I had first heard about the problem last summer, when a British friend who is GM of a plant in Suzhou told me he had had to hire five new engineers because the previous tenants had left for higher salaries. He was only able to replace three of them in a timely fashion; two of them simply weren’t qualified once put on the floor to do the jobs for which they had been hired.
Typically, the campaign for escalating wages goes like this: a financial manager in her mid-to-late thirties goes from salary increase to increase: each time she is dissatisfied with her job she threatens to quit. With each threat management simply increases her salary to mollify her. Another financial manager is clever enough to first interview at other companies, actually receive offers from interested businesses, then demand a counter-offer from her current employer. In most instances, the current employer simply raises the pay, since it is the easiest course.
Now, it seems to me, after five years of job hopping and salary blackmail, the average capability-challenged professional is in her early to mid-thirties. She is pretty satisfied with what she’s achieved, and, to my mind, become a bit lazy. The new labor law, which makes it costly to fire staff – even if they are not performing to standards – gives them an even greater sense of security.
But I’ve seen a trend I don’t think they are aware of, these walking empty vessels. There is an army on the way of young Chinese with only a couple years experience and truckloads of motivation who are just a fraction of the cost of the empty vessels. I’ve seen these young people, even worked with some of them, and they are fresh and vibrant and ready to learn and hungry for what the world has to offer. Competition between members of these youngsters - what I call Generation W(eb) - is fierce, and they haven’t developed the same lethargy that their predecessors have.
In other words, the Capability Gap will indeed one day be filled; and employers will find it more cost-effective to simply cut the dead weight of bloated under-performers and to replace them with less expensive, more energized Generation Ws.
Let this be a warning to The Chinese Complacent.
4 Responses to “A New Kind of Generation Gap in China”
By the tank man on Jun 4, 2008 | Reply
Everything happens for a reason.Bill. Before you jump to the conclusion that this is just a discontent generation of walking empty vessels, think about what they are trying to look for and what they need to encounter every day.you don’t have to keep hopping from jobs to jobs or salary increase of course cos you get paid in Dollars.They are not!!!!
And also please do think thrice if there is twice before you call them a gerneration. There are also large number of people in this gerneration who has been committed in a position for a decade,they may not be what you call walking empty vessles.
By This is China! on Jun 4, 2008 | Reply
Tank Man;
I don’t think this has much to do with currency valuations, especially as I’m paid in RMB. However, human nature and economics does have it that when demand outstrips supply humans will simply flow where the money is, no matter the country. The same is happening south of the border (Vietnam, not Mexico) - but it did happen in Mexico about fifteen years back when NAFTA brought production to the maquiladoras along the Mexico-Texas border.
And though there may be Chinese staff with ten years in organizations, those do rather tend to be government offices and State Owned Enterprises - not private enterprises (unless the individual started the company on his or her own or is related by blood to the founder).
Every blog needs a contrarian. Thanks for the input!
By George on Jun 5, 2008 | Reply
Bill,
I concur with your comments.
As an employer, it is a clear requirement to manage up or manage out the dead weight now more than ever. Of course it’s harder to manage people out than before (thank you new Labour Contract Law) but it just means you need good processes and the will to jump through the hoops.
As you mentioned the youngsters “haven’t developed the same lethargy that their predecessors have” but that some of them are perfectly capable of learning that lethargy from the experienced older hands if you’re not fairly ruthless about tackling the problem.
By This is China! on Jun 5, 2008 | Reply
George;
Excellent point you brought up about the impact of the new labor law. I’m finding in my own company the going quite rough in “re-calibrating” the level of skills, experience and commitment to the work.
My next column for Eurobiz will be on exactly that: the challenges and solutions Western managers have found in dealing with the new labor law. Of course, I never use the real name of companies and individuals in my column, so I hope you feel free to contact me with some of your insights.