Archives June 2009

Summer online job week to kick off

China will launch a nationwide week-long online job fair starting Saturday. Information will be collected and posted on several websites. They include the Ministry of Human Resources and Social Security, the National College Grad Employment Service Platform, and the China Labor Market.

Fewer than half of this year’s college graduates have found jobs, due to the global downturn.

The target employment rate for graduates is 80 percent by the end of August.

China to stabilize employment

China’s newly employed workers dropped again in April after rebounding in the first quarter. The Ministry of Human Resources and Social Security has promised to use the unemployment insurance fund to stabilize the situation.

New employment in urban areas in April dropped more than 10 percent in eastern regions. In Shanghai, the decline reached 45 percent, in Fujian province, 23 percent.

The registered urban unemployment rate hit just over 4 percent, the highest in four years. The Ministry of Human Resources and Social Security says it will use 30 to 40 billion yuan in the unemployment insurance fund to stabilize employment.

Zuo Chunwen, dept. director of Ministry of HR& Social Security, “we will move forward our frontier of unemployment insurance. It used to be given to people who lost their jobs. We will now use it to keep workers employed.”

China’s unemployment insurance fund reached 131 billion yuan at the end of last year. The system covered 124 million people. The Ministry says it will use the fund to encourage enterprises to retain positions through training, adjusted working hours, and negotiating salaries.

The Ministry says local governments should launch policies to both increase and stabilize jobs. The focus should be on graduates, search services and essential training.

Employment in Shenzhen to recover

The employment situation across China has begun to show signs of recovery thanks to stimulus policies initiated by the central government. Especially those policies aimed at ensuring growth and employment.

New figures show the major economic index in Shenzhen is continuing to climb. They also show that native brand enterprises such as Huawei and Zhongxin Communication have maintained over 20 percent growth between January and April. And the increase in orders has directly stimulated employment demand. The Shenzhen Labor department reported that the job supply and demand ratio in January was 0.74. But in May, that ratio expanded to just over 1.08, slightly easing the situation.

Lai Yuewen, Employment Dept. Shenzhen Labor & Social Security, says, “we believe the warming-up of the human resources market in April and May shows that our economy in the city is getting rid of the stress, gradually brought upon by the global financial crisis.”

MySpace to cut staff by about 30%

Social networking Web site MySpace will cut its staff by about 30 percent so as “to return to an environment of innovation,” company executives confirmed on Tuesday.

The job cuts will affect about 425 employees across all its U.S. divisions, the company said.

The company took the move after it had been steadily losing ground to rival Facebook, MySpace CEO Owen Van Natta said.

“Simply put, our staffing levels were bloated and hindered our ability to be an efficient and nimble team-oriented company,” said Van Natta.

“I understand that these changes are painful for many,” he said.” They are also necessary for the long-term health and culture of MySpace. Our intent is to return to an environment of innovation that is centered on our user and our product.”

MySpace’s corporate offices are based in Beverly Hills near downtown Los Angeles.

Jonathan Miller, an executive with parent company News Corp., said MySpace “grew too big considering the realities of today’s marketplace.”

“I believe this restructuring will help MySpace operate much more effectively both structurally and financially moving forward,” he said. “I am confident in MySpace’s next phase under the leadership of Owen and his team.”

The job cuts will leave MySpace with about 1,000 domestic employees.

Graduates Sharply Lower Salary Expectations

College graduates in China have sharply lowered their salary expectations to something between 2,000 to 3,000 yuan per month for their first jobs after graduation, according to a latest survey on the current employment situation, Beijing Evening News reported on June 17.

This salary expectation drop was almost half from the previous 4,000 to 5,000 yuan per-month salaries college graduates ever foresaw last year.

The survey, conducted by Zhilian Recruiting, a major man-hunting company in China, questioned 15,000 students graduating from college in 2009.

According to the survey, some 45 percent of undergraduates expect salaries of 2,000 to 3,000 yuan a month, but 26 percent of postgraduates think that rate acceptable. Meanwhile, more postgraduates, 34 percent, are eyeing 3,000 to 4,000 yuan per-month salaries, though. PhD graduates of course expect more, with 44 percent counting on at least 5,000 yuan per month.

Xiao Fang, a postgraduate from a prestigious university said she was experiencing a tough time in the job market and had to bring down her monthly salary expectations. After being told her 5,000 yuan baseline was impossible, she reduced her expectations to something about 4,500 yuan.

About 6.11 million students are expected to flux into the job market this year, and one million left from last year are still looking for jobs. To make the situation worse, more jobs are being axed due to the lingering economic slowdown. In general, students’ chances of getting employed have been hard hit by the global slump.

Experts say graduates are more pragmatic when they seek jobs at the moement. They suggest graduates integrate their job expectations with the recent national stimulus packages. Rather than setting their hearts on prestigious firms in big cities, they should consider other options, like working in rural villages.

SOE employment open for Taiwan students

For the first time that Taiwan students graduating from mainland universities are being allowed to work in state-owned enterprises.

The Fujian provincial government has issued a notice saying these students may apply for positions in state-owned enterprises. They will enjoy same salaries and benefits as mainland students.

So far, more than 1,000 universities on the mainland have accepted 30 thousand Taiwan students. Ten thousand remain in class. Most of them are in Fujian, Guangdong, Beijing and Shanghai.

Job market predicted to touch new low

EMPLOYMENT on China’s mainland for the third quarter will cool to a five-quarter low due to the impact of the global economic downturn, according to a quarterly survey released by Manpower Inc yesterday.

But expectations are falling more slowly than the previous quarter, thanks to the government’s fiscal stimulus package, said the report, based on interviews with 4,026 employers on the mainland.

Companies in the steel, automobile, finance and transport industries were likely to hire more employees in the coming months, in response to industry adjustments and revitalization plans issued by the State Council, the report said.

“There were some optimistic signs. But whether confidence in the whole labor market can be lifted depends on how the economy changes in the second half of this year,” said Wu Ruoxuan, Manpower Greater China’s managing director.

Eleven percent of HR respondents surveyed in 13 cities said they will expand head counts, while 9 percent said they would cut staff.

The report claimed 66 percent of employers said they would maintain current staffing plans – 10 percent higher than the previous quarter.

“The fact that more companies expect to keep current staff levels rather than cut them shows market confidence is becoming more stable,” said Zhu Yijuan, from Manpower.

Hiring in the service industry was the most robust. Finance and insurance, mining and construction and the transport industries also showed stronger hiring prospects compared to the previous quarter, but all had declined from the same period last year, the report said.

Pharma health means more jobs

Pharmaceutical company Lilly China will double its staff to 2,000 this year even as experts debate whether the economy has bottomed out.

“A large portion of the hires are in sales and distribution as we expect to do a better job reaching patients in central and western areas of China,” David Ricks, Lilly China president, told China Business Weekly late last month.

But he added Lilly China is growing in all aspects, so new employees will be needed in virtually every function from manufacturing and R&D to accounting and operations.

Lilly China is not the only pharmaceutical firm expanding recruitment in China even as global workforce numbers are stagnant or even dropping.

Swiss drug maker Novartis Pharmaceuticals expects to increase its 2,700 employees in China by 20 percent each year until at least 2013. The bulk of the new positions will be in sales, according to CEO Joseph Jimenez.

Amy Huang, vice-president and China director of GlaxoSmithKline (GSK), said the company does not intend to cut its budget for China this year – instead it will invest more in developing new medicines and vaccines, including funds for expansion of human resources related to R&D. The UK-headquartered company announced in February it will cut 6,000 jobs this year globally.

The world’s second-largest generic medicine company Sandoz said it will recruit more people in China, not only in sales and manufacturing, but also managerial talent.

“The reason for the workforce enhancement in China is rapid expansion of these drug companies here,” said Peng Haizhu, pharmaceutical analyst of Huatai Securities.

Year-on-year sales of Lilly China grew around 30 percent in 2008, while its global business rose 9 percent. GSK achieved a 12 percent growth in sales in emerging markets.

China outperformed other emerging markets with a 22 percent increase in sales as global numbers fell by 3 percent. Sales by Novartis Pharmaceuticals in China jumped 29 percent year-on-year to 3.3 billion yuan in 2008, compared with its 6 percent global growth and the company is expecting a 30 percent rise in China this year. AstraZeneca’s figures were 25 percent and 7 percent in China and the world respectively.

Best performers

“In any global company, different regional operations are competing with each other for limited resources, so the best performers will get more support from headquarters,” said Wu Changqi, associate dean of Peking University’s Guanghua School of Management. “So, it’s understandable that the promising China branch can add workforce while other regions cut jobs.”

As well, surging demand in China stimulated pharmaceuticals to build new facilities that create job opportunities for locals.

It is estimated that more than 200 million households in China will earn over 40,000 yuan a year by 2025, with spending on private healthcare and medicines by urban consumers expected to record double digit growth every year in the coming two decades, according to a report of PricewaterhouseCoopers, an industry assurance, tax and advisory services provider.

Eli Lilly, eyeing the market potential, has pledged to inject $100 million in China for R&D from 2008 to 2012. In February, Pfizer set up a $60 million manufacturing facility in northeast China’s Dalian city, while Bayer announced plans to invest up to 100 million euros over the next five years for an R&D center in Beijing.

Peng pointed out that China’s three-year 850 billion yuan medical system reform package that aims to provide more accessible and affordable healthcare to the country’s 1.3 billion people provides new opportunities in smaller cities and rural areas, which in turn drives pharmaceuticals to recruit more employees to reach those regions.

Executives of foreign drug behemoths all admit that a large part of new recruits will be sales people who will be in charge of setting up distribution networks in China’s western and central areas and in county-level hospitals.

“Qualified people specialized in this kind of work are not easy to get,” said Peng, explaining that they should have pharmaceutical background, be familiar with medical systems and local cultures in underdeveloped areas – very different than in large cities – as well as have hard-working and easy-going personalities.

Ricks said campus recruitment is key to finding new employees who have a professional medical background. People who leave other sectors and turn to the pharmaceutical industry are also welcomed. Executive headhunting is used for managerial positions.

Peng of Huatai said finding and retaining talent is a real challenge for pharmaceutical companies because the number with medical backgrounds cannot keep pace with the surge of demand, resulting in ever-increasing competition among various companies.

Lilly China’s Ricks estimated that turnover is as high as 35 to 50 percent in local drug firms and 20 to 30 percent in multinational companies. In Lilly China, the figure is 5 to 10 percent.

“In finding and retaining good and skilled people our strategy is to build from within,” he said.

Peng attributed the relatively lower turnover to bigger salaries at multinationals.

“Multinationals are particularly attractive to R&D talent as their research facilities are usually world class and international communication is much more convenient and up to date.”

Wu of Peking University said companies that make efforts to recruit new talent and provide a professional, ethical corporate culture are smart.

“They are accumulating high-level human resources and preparing for the coming recovery,” he said, predicting that the emerging markets, including China, will still develop faster than developed economies when rising from the economic slowdown.

“Talent will be the most needed resource in the recovery – it is hard to cultivate in a short time,” he added.