Archives 2009

Chinese firms start new hires amid economic recovery

Chinese employment service providers said domestic firms have started a fresh round of hiring, especially for management level position, as part of the efforts to cash in on the economic recovery, but most of these firms are still finding it hard to get the right candidates.

Three industries — real estate, hi-tech and retailing — are at the forefront of the current round of hiring, according to Wednesday’s China Daily.

Wang Shangfeng, general manager of Gold Elite, a major Chinese job hunter, was quoted as saying the past few months have been the worst ever for the company. Demand (from clients) for new labor shrank sharply since the financial crisis broke out. Some private companies were watching while others, especially international companies, stopped hiring.

The company’s business has improved since early June. Like GoldElite, DoWelljoin Hunter, another employment service provider, also sees clients back for new hires last month. Its business has grown by 40 percent last month compared with the previous months. The growth rate was even higher than a year earlier.

However, companies in China are still finding it difficult to get the right candidates for the wanted positions, said a survey by Manpower.

According to the survey, 15 percent of the employers are struggling to fill up positions. The top three jobs that they are having difficulties to fill up this year are technicians, management or executives and sales representatives.

Baker & McKenzie Plans to Cut 11% of Lawyers in China

Baker & McKenzie LLP, the world’s second-largest law firm by revenue, plans to eliminate 11 percent of its lawyers and professional staff in China because of the “very challenging” economic climate.

“These difficult measures are necessary to ensure our ongoing financial health in an increasingly competitive environment,” the Chicago-based firm said yesterday in an e-mailed statement. A comparable number of secretarial and support staff will be leaving, according to the statement.

Baker didn’t say which practices were affected. The firm has more than 350 lawyers and professional staff in Hong Kong, Beijing and Shanghai, according to a separate statement yesterday on the appointment of five partners in the three cities.

International firms including New York-based Proskauer Rose LLP and London-based Ashurst LLP have opened Hong Kong offices in the past 12 months, drawn by a boom in initial share sales by Chinese companies in the city which raised $40 billion a year in 2006 and 2007.

While new share sales collapsed to $7.9 billion last year, bankers and analysts predict a revival this year, with Goldman Sachs Group Inc. saying as many as 100 companies may be reviving sales plans postponed during the 2008 equities rout. The accounting firm Ernst & Young LLP has said as much as $39 billion may be raised in Hong Kong and China in 2009.

DLA Piper Cuts

Firms including Chicago-based DLA Piper LLP cut lawyers and staff in Asia in the first half of this year and most of the region’s legal job cuts were thought to be over, according to Jacqueline Keddie, a Singapore-based managing consultant at legal recruitment firm Law Alliance.

“The market isn’t so robust that anyone can guarantee there will be no further retrenchments,” she said.

The dismissals at Baker are at least the firm’s third round of job cuts globally this year.

“The current economic climate is proving very challenging for most businesses, including many of our clients,” Baker said in its statement. “It is difficult to predict the timing and pace of the recovery of the markets in which we operate in Asia.”

Baker & McKenzie said in its statement that its new partners in China are: Joseph Deng, Barbara Li, Eugene Lim, Scott Palmer and Jennifer Van Dale. The firm said in it now has 72 partners at its offices in China and Vietnam.

More effort to boost employment

The Chinese government is sparing no efforts to help college graduates find jobs. Local related departments have been urged to launch campaigns in the next three months to boost employment.

Education departments and universities are required to help graduates whose files are still in the school, to find jobs as soon as possible. Unemployed graduates whose files have been transferred to their hometowns can contact local human resources authorities for internship opportunities. Companies that employ interns and local governments should offer living subsidies to the graduates.

Yu Faming, official of Ministry of Human Resources & Social Security, said, “We will publish a list of internship bases, universities could choose one to cooperate with and send their students there.”

Employment campaigns have already been launched in some places. In Sichuan Province, local authorities have organized a job fair for graduates who want to start a business and graduates from low income families.

Award offers expats lower taxes

SHANGHAI will launch a “financial talent award” soon to make the city more attractive to foreign financial specialists, said Fang Xinghai, director of the Shanghai Financial Services Office, yesterday.

The award also allows for a lower tax burden for expatriate financial talents in Shanghai and aims to build the city into an international financial hub by 2020.

“We can’t change the standard of the individual income tax on foreigners working in Shanghai – that is a national issue. But we do hope to attract more financial talents into Shanghai by lowering the tax burden on them,” Fang said at the First European Union Shanghai International Financial Forum.

He said the award will be given to senior foreign executives working for Shanghai-registered financial firms and details of the incentive will be announced soon.

Compared with Singapore and Hong Kong, the Chinese mainland imposes a relatively high individual income tax of up to 45 percent on foreigners working in the city, which hurts Shanghai’s ability to attract foreign talents, said Fang.

He also noted Shanghai will soon set up two special financial courts in Huangpu District and Pudong New Area to deal with financial disputes.

Meanwhile, Fang urged the central government to give Shanghai more freedom to innovate.

These efforts are aimed at accelerating Shanghai into an international financial center. The State Council, China’s Cabinet, backs developing Shanghai into a global center of finance and shipping by 2020.

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.”

Olympics STUFF for Beijing, Expo 2010 STAFF for Shanghai!

By Patrick O. Courtois

The Beijing Olympics have had a great impact on the city of Beijing, where a large infrastructure refurbishment initiative, fresh developments and a massive English language training campaign have been some of the elements of a drastic change and an amazing source of business opportunities for both local and foreign companies. Shanghai, with its upcoming Universal Exposition in 2010 is going through the same face-list, with the replenishment of the famous bund area, the accelerated infrastructure changes much needed to ease the megalopolis congestion problem and much more. Commercial opportunities are as well rising fast toward the May opening of the Exposition; opportunities that are being seized by both for local and foreign companies.

I have anticipated a rise in solicitaton from pavilion ran countries. Tendering processes are going on in most country having a pavilion presence, and many overseas third parties have, and still are, gotten in touch with me for solutions in search and selection of the pavilion staff, but most importantly staffing, enabling each pavilion to legally employ staff, local Chinese or foreign nationals, without having to establish a legal corporate entity in China. My firm being fully licensed and resourced for both activities it is of course a solution that we are capable of handling.

However what was not anticipated is the rise in solicitation from overseas SMEs.

Some the challenges faced by SMEs, while trying to seize their share of the tremendous financial and marketing opportunity the Exposition yields, can be briefly summarized as such:

• No local contact / connection in China
• No interest in forking out the additional cost, not to mention the lengthy process, of setting up a corporate legal entity for the limited duration of the Exposition (6 months)
• how to source bilingual and qualified employees locally
• how to legally employ local and eventually foreign national staffs during the Exposition period
• …

The opportunities are there, the challenges as well, but most importantly, solutions exist. Solutions that are legal, hassle free and well… affordable.

When you are operating an overseas SME, with a limited margin for error or financial flexibility, the process of establishing a commercial or operational presence in China can be seen as a daunting task. Entrusting a local business partner becomes therefore a viable solution, as you can stress-free focus on what you do best, that is sell and promote your products/services, while the local partner handles the “Chinese” side of things, like recruitment, employment, payroll, labor law compliance and so on, on your behalf.

Before signing up with a staffing company a few essential points are to be kept in mind:

• Do your research and make sure the firm you are engaging yourself with is LEGALLY LICENSED… that make sense, in the west at least, but I can guarantee you that a casual “sure, I can help” answer, here, is not what you should expect.
• Make sure they do have experience and references available for their staffing activities…
• Compare prices, as tariffs for staffing solutions can go from a few thousand US Dollars to a few hundred Chinese RMB from a firm to another, per month, for pretty much the same service level…
• Make sure that the firm has the INTERNAL resources to provide you with a pro-active and professional service. Too many firms around will be happy to take your money but will outsource payroll, contracts, … In China, quality is not always here while dealing with third parties suppliers…
• Foreign staffing firm versus Chinese firm? This is entirely your choice… but bear in mind that a foreign firm does not necessarily have the flexibility a local firm can have in terms of terms of quick fixes and might not be able to provide additional services like last minute lodging, visa and such… In addition, a foreign firm might have larger overheads and as such that might impact the quote you received.
• Finally, trust your guts. If the few emails you exchanged gave you a somewhat dodgy feeling or your primary contact gives of the sense of being “lost in Translation” at every phone conversation … walk away…

…or better, call me!…

Patrick O. Courtois is the Director of Operations at DaCare Executive Search, a leading executive search and HR services consultancy, based in the heart of Shanghai, China. (http://www.dacare.com/). Patrick has extensive management consulting experience in Asia, as well as European markets. With a current focus in executive talent sourcing in Greater China, Patrick engages with multinational clients in professional services, hi-tech communications and industrial manufacturing. Visit Patrick’s HR blog at http://hrshanghai.blogspot.com/.

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.