China’s rapid economic growth has resulted in an
increasingly individualistic society. Traditional values are still at
the core of Chinese culture, however personal ambition and the desire
for acknowledgment of achievement are beginning to define behavior, in
particular within the younger generations. Consequently, many foreign
companies face difficulties recruiting and retaining staff in China.
3.1:
Current Trends in the Chinese Labor Market
3.2:
Rules of Thumb for Hiring Managers in SME's
3.3:
Engaging a Professional Recruiter
3.1: Current Trends in the Chinese Labor
Market
High Turnover Rates
| Observation: |
It is increasingly common for Chinese employees to switch
jobs every few years. |
| Fact: |
The younger Chinese are very competitive and are always
looking for
career progression opportunities to better position themselves in the
global market. Hence, they tend to welcome headhunters and do not
hesitate to take up better offers. |
| Outcome: |
Talent is easily accessible if one has the relevant contacts.
However, it remains generally hard for employers to retain these
talents in a single company for long-term commitment. |
Increasingly Competitive Salaries
| Observation: |
Salaries are generally becoming more competitive in China. In
particular, salaries in 1st-tier cities are approaching levels found in
other more developed countries. |
| Fact: |
The phenomenal economic growth of China has led to a rapid
rise in
salaries for managerial and higher positions. This is in contrast to
the very stable and generally stagnant salaries found in developed
countries. |
| Outcome: |
Cheap labor is disappearing in China for managerial positions
and higher positions, especially in 1st-tier cities. |
Prevalence of Younger Upper Management
| Observation: |
Managerial and higher positions are increasingly held by
young
individuals. In fact, many directors of corporations in China are only
in their early thirties. |
| Fact: |
Due to the Chinese economic reform in 1978, education
standards
have improved drastically over the past years. This has resulted in a
great disparity in knowledge and capabilities between the young and
old, especially in terms of English competency levels. This has thrown
off the conventional thinking that senior candidates are always more
capable than their younger counterparts. |
| Outcome: |
Highly educated young Chinese are now possible candidates for
managerial and higher positions in China and such positions are no
longer necessarily held by senior employees. |
Back
to Top
3.2: Rules of Thumb for Hiring
Managers in SMEs:
-
Look for passively available
candidates for important positions
Passively
available candidates tend to be highly capable individuals who are not
threatened by the possibility of retrenchment. This is different from
active job seekers who may have been retrenched due to
performance-related issues. This is particularly important for
positions that are responsible for a company’s profits and losses.
Hence, companies are advised to be careful of being tempted by the
extremely convenient and active online recruitment services in China.
Instead, professional recruiters should be engaged to source for and
recruit quality candidates from other companies.
-
Expect to pay a premium for proficient users of English
Due
to the great disparity in English competency levels existing in China,
candidates strong in English can easily command premium salaries that
are 30% higher than the average employee. This is partly due to the
high demand for such candidates from multi-national corporations
(MNCs).
-
Do not depend solely on phone interviews when hiring in China
Phone
interviews provide insufficient information for screening candidates.
There have been cases of deceit in phone interviews where candidates
engaged external help to ace through interviews without actually
possessing the required competencies. Moreover, due to China’s great
diversity of ethnic groups, it becomes even harder to assess the
qualities and reliability of a person through a simple phone call.
Hence, companies should always conduct face-to-face interviews for
better evaluation of candidates and prevent the occurrence of frauds.
-
Do not negotiate directly with candidates if you are unfamiliar
with their cultures
This
is particularly true for sensitive issues such as salary
negotiations. Miscommunications tend to occur in such
negotiations due to cultural differences in expression. This has
repeatedly resulted in foreign companies dismissing good candidates
prematurely. Hence, companies should always negotiate salaries and
other sensitive issues via experienced recruiters or HR professionals
who are familiar with the local culture.
-
Keep in touch with selected candidates
Chinese
candidates have very strong desires to succeed in the global economy.
Hence, it is not uncommon to find them continuing to search for better
opportunities despite having accepted an offer. Thus, it would be wise
for hiring managers to keep in touch with the selected candidates and
take note if they are still keen and available to join the company.
This will help to avoid unnecessary surprises when the candidate fails
to show up on the first day of work.
-
Hire candidates from the vicinity if your office is located in
2nd/3rd tier cities
Foreign
SMEs have been found to prefer candidates from 1st tier cities despite
having their offices located in 2nd or 3rd tier cities. This is because
these candidates are more likely to be able to relate easily to their
employers in terms of both language as well as their expectations for
standards of living. However, such candidates may find it difficult to
adapt to the poorer living conditions of the lower tiered cities. This
can eventually lead to high employee turnover rates and become
detrimental to the company.
-
Place greater emphasis on core competencies in 2nd/3rd tier
cities
As
English proficiency levels tend to be lower in 2nd and 3rd tier cities,
it may be difficult to locate candidates who are both good in English
and have the required competencies. One way to work around this is to
hire candidates with English majors and train them in the relevant
skill sets. Alternatively, companies can hire candidates based on the
required competencies and leave the linguistic requirements to a
specialized role within the company.
Back
to Top
3.3: Engaging a Professional Recruiter
Employers are advised to engage professional recruiters
when sourcing for specific talents to fill important positions. In
particular, they can help ensure the timely arrival of suitable
candidates who are committed to and interested in pursuing the
opportunity. This avoids the dire consequences of leaving such
important positions vacant for extended periods of time.
Methodology
The key differentiating factor between a professional
recruiter and an amateur lies in the
methodology adopted in their search for candidates. Professional
recruiters are in control of
the
entire process. They understand the specific needs of their clients and
are able to accurately identify a best-fit candidate in the shortest
possible time. In contrast, amateurs are heavily reliant on the quality
of resumes they receive and may not be able to perform when faced with
unfamiliar industries.
In particular, many professional recruiters use a
precise search process called the Social Networking System
(SNS).
It helps recruiters to narrow down and identify potential candidates
efficiently via recommendations from one’s contacts in the relevant
industry. The process is then repeated for several degrees of
separation until a best-fit individual emerges from the
recommendations. Nonetheless, this is a complicated process and
requires many years of experience in headhunting as well as in-depth
knowledge of niche areas in specific industries to be effective.
Other Factors
Besides methodology, intangible soft-skills are also
critical in headhunting. These are important factors that must be
considered when evaluating the professionalism of a recruiter.
-
Network
This determines
the range of coverage in an executive search service. However, it does
not necessary mean that a wider search is always better, as in-depth
knowledge of a specific labor market may have been compromised for
greater coverage. Hence, the suitability of a recruiter’s network
depends on the job requirements and where such candidates can be found.
-
Persuasion Skills
Best-fit
candidates may be passively-available instead of being actively engaged
in job-hunting. In other words, they are still employed and may require
substantial persuasion to leave their established portfolio. Hence, a
recruiter’s ability to motivate a candidate to explore new
opportunities is a crucial, final step in headhunting. Moreover, the
way an offer is positioned in terms of career development will also
affect a candidate’s commitment to the client company after the end of
the probation period
Hence, it is important to engage a capable recruiter,
especially for positions that are hard to fill. Otherwise, mismatches
may occur repeatedly, wasting both time and effort of all parties
involved.
Back
to Top
Download the complete China
Market Entry Handbook free of charge.
For more information, please contact us: info@jljgroup.com
