Category News of China

High-tech firms encouraged to recruit more graduates

Chinese high-tech enterprises have been encouraged to find more vacancies for graduates due to the country’s mounting employment pressure.

High-tech companies are working hard to recruit more than 950,000 of the record-high 6.99 million graduates this year, according to science and technology minister Wan Gang.

More than 3.62 million university graduates have been employed by the country’s 49,000 high-tech companies since a regulation dedicated to develop such firms was introduced in 2008, according to the Ministry of Science and Technology.

“High-tech enterprises should actively bear social responsibility and take the lead in terms of providing graduates with more suitable positions,” said Wan.

The number of Chinese graduates will rise 3 percent year on year during the 12th Five-Year Plan period (2011-2015), said Xin Changxing, vice minister of human resources and social security.

China’s high-tech enterprises are largely located in the country’s first-tier cities such as Beijing, Shanghai and Guangzhou.

CEO of Recruitment Firm Zhaopin Sees Strong Job Market in China

Worried about China’s slowing economy? Evan Guo, chief executive officer of Zhaopin Ltd., has more than 2.5 million reasons not to. That’s the number of job opportunities posted on Zhaopin.com, one of China’s largest recruitment websites.

Despite sharply slower growth, the world’s second-largest economy continues to create jobs, he says.

Zhaopin, which is majority-owned by Australian job site Seek Ltd., SEK.AU +2.16% chalked up revenue of $138 million in 2012 with a workforce of 3,200, benefiting from a growing economy and an increasingly Internet-savvy, job-hopping young workforce. But they also face challenges from rival Chinese job sites such as 51job Inc., JOBS -1.54% and from the rise of social networks. Mr. Guo, who previously worked at management consultancy McKinsey & Co. and helmed a state-owned enterprise in China’s logistics sector, sat down with The Wall Street Journal in his Beijing office to discuss the evolution of China’s Internet and why the models you learn at business school don’t work in China. Edited excerpts:

WSJ: What did you learn at McKinsey that has helped you in your current role?

Mr. Guo: At McKinsey you learn ways of thinking, analytic frameworks. But often they are not applicable to the entrepreneurial world in China. In the Western approach, you look at key performance indicators, you check the data. But in China you have to respond very quickly to changes in policy, what employees are thinking, often based on little data. You have to act based on gut feelings; if you act according to what the text books say, you will get it wrong.

WSJ: There is a lot of concern about the slowdown in China’s growth. How concerned are you?

Mr. Guo: We won’t see a return to 10% growth. Expectations now are for something around 7%. But that’s not a disaster. If I look at our own business, employment is still growing. High-tech, logistics, services, health care are all recruiting. We’re also seeing rapid growth in job opportunities in third- and fourth-tier cities. I’ve spoken to a lot of small firms and they are growing fast and adding workers.

WSJ: Do you see any sectors that are doing less well?

Mr. Guo: We see fewer job opportunities in manufacturing, and also in retail. Retail is worrying because the government wants to boost Chinese consumption. But when we look at how shopping malls are doing, they are not doing so well. E-commerce explains some of it, but not all of it.

WSJ: In the U.S., social networks like LinkedIn have been a major challenge to recruitment websites like Monster. How will that play out in China?

Mr. Guo: In the U.S., LinkedIn has overtaken Monster but so far it has not had much impact in China. Chinese are very practical when it comes to switching jobs. You can see that in how Chinese talk about salary. In the U.S. it’s considered rude to talk about how much you earn, but in China people are quite open about it.

Zhaopin tells Chinese job seekers what they want: “Can I get more money in this job?” LinkedIn is through social networks, so it’s very indirect.

We survey students about where they most want to work. A few years ago, they all wanted to work at multinational firms like Google and Microsoft. Now they see Chinese firms doing well and see them as more desirable, so I am not too worried about competition from overseas firms.

WSJ:Guanxi, or personal connections, is meant to be very important in China. But that’s not how Zhaopin works.

Mr. Guo: Job seekers always want the best opportunities. Guanxi can tell you about some of the opportunities, but recruitment websites can tell you about all the opportunities and give you salary comparisons. At the entry-level or the midlevel that’s important. For top executives, then it’s about personal connections again—they won’t be using the website.

WSJ: There is a wave of consolidation in China’s Internet. What does that mean for Zhaopin.com?

Mr. Guo: The Internet giants can drive big traffic, but traffic doesn’t resolve marketplace issues. In verticals like recruitment or real estate, you need deep knowledge of what customers are searching for to succeed, and that’s not easy to develop. I don’t worry too much about whether we have this business model or that business model—if I did that I would never sleep. It’s more important to think about what customers want and how to give it to them.

WSJ: How much space does Zhaopin.com still have to grow?

Mr. Guo: We are already covering 100 cities so that is already quite wide. But in terms of depth we are quite shallow, covering about 20% of the marketplace. The price employers pay to advertise with us is also quite low by international comparison, so in volume terms and in price terms we have room to grow.

WSJ: Is an initial public offering on the agenda?

Mr. Guo: We are considering an IPO in the future. That depends on capital-market conditions, our own strategy and execution, and what employees want—they see an IPO as a source of pride and a landmark for the firm.

WSJ: How receptive do you think foreign investors are to Chinese firms right now?

Mr. Guo: You have to distinguish between private and public markets. In the private markets, I see private equity and venture capital investors are hungry for deals. But there are less and less good deals and they become more and more expensive. On public markets, high-quality Chinese companies still get attention. Some big funds are interested in Zhaopin.com. But for individual investors, it’s more difficult to understand the opportunity when they can’t even pronounce the name of the firm.

Résumé
Education: Northwestern University Kellogg School of Management, 1999, with a master’s in business administration.

Career: In 1994, Mr. Guo was one of the first analysts in China employed directly by McKinsey, a firm he left as a global partner. He started a software outsourcing firm and headed state-owned logistics operation Sinotrans Air Transportation Development Co., before joining Zhaopin as chief executive in 2010.

Corrections & Amplifications
In an earlier version of this story, the credit accompanying the photo of Zhaopin Ltd. Chief Executive Evan Guo misstated the source of the image as Zhaopin Ltd. The photo was taken by Lilian Lin, a Wall Street Journal researcher.

Employment pressures affect young Chinese love lives

For 22-year-old college graduate Han Xiaolei, the upcoming Qixi Festival, also known as Chinese Valentine’s Day, is doomed to be a heartbreaking one.

The native of central China’s city of Wuhan just broke up with his girlfriend, who had to go back to her hometown in south China’s Guangxi Zhuang Autonomous Region after failing to find a job in Wuhan, as Han did.

“I cried a lot on the day we broke up and it still hurts. We were together for three years, but our love had to surrender to reality,” Han said.

Soaring living costs and the growing difficulty of finding a job have made it difficult for young Chinese to maintain healthy romantic relationships. Even those who are fortunate enough to find a job are often overworked and underpaid, leaving them with no time or money to sustain a relationship.

“The reality for graduates in China is that their relationships are directly affected by their employment status,” said Fan Xianzuo, a professor at Central China Normal University who has been studying the post-college lives of the school’s graduates.

According to a nationwide employment survey conducted by Wuhan University, about 43 percent of China’s graduates may be unemployed in 2013 as a result of the country’s weakening economy.

An employment report issued by the Beijing Youth Stress Management Service Center in May showed that the average monthly pay for this year’s new graduates is 2,000 to 2,500 yuan (327 to 408 U.S. dollars), accounting for 60 percent of the average monthly salary for new grads in 2012.

Although Beijing resident Yang Lijun managed to nail down a job in the same city as her boyfriend after graduating from Tsinghua University, she is still having difficulty in keeping their romance alive.

“We have no time to be as romantic as before, as my job’s night shifts basically deprive me of the opportunity to see him,” Yang said.

“We have no time or money for regular celebrations. Life has made us the most unromantic people in the world,” she said.
Yang now lives with three roommates in a 60-square-meter apartment and only sees boyfriend during weekends. Her monthly rent is 2,400 yuan, nearly two-thirds of her monthly pay.

It is customary for young Chinese couples to purchase a home before getting married. Many women even refuse to marry a man before he has obtained a home. However, growing housing prices have made it difficult for young men to do so.

The average transaction price for a single square meter of housing in Beijing in July was 25,292 yuan, as estimated by HomeLink, a property brokerage firm.

“When I think about the down payment on our future apartment, my mood for romance is immediately gone,” Yang said.

Fan said he believes new graduates like Han and Yang need the care and support of all of society, as young people will play a significant role in China’s future development.

“Unlike their parents, this generation was born and raised during an economic boom. Few of them have had difficult life experiences, so they need time and support to become strong and independent, both financially and mentally,”Fane said.

Li Tonggui, a social psychology professor at Peking University, said more social services should be offered in order to help graduates adapt to post-campus life.

Although things have been difficult so far, Yang said she is still confident in the future of her relationship.

“The days when we work hard together for our future can be a lifetime fortune for us. It doesn’t matter how we celebrate the Qixi Festival. A phone call or a text message could be the best gift, as long as we are together,” she said.

UN official sees Chinese economic growth ‘stable’

President of the United Nations General Assembly Vuk Jeremic said Friday that the Chinese economy is one of the strongest performers worldwide and offers optimism to the world economy.

Jeremic, president of the 67th session of the UN General Assembly, made the comments in a joint interview with Chinese media in Beijing.

He said one of the most significant reference points to the world economy is China’s economic situation. If China is going in the right direction, the rest of the world will be going in a good direction economically. If China is having difficulties, everybody is going to have difficulties.

In the first half of the year, China’s economic growth slowed to 7.6 percent.

“The growth, which some people question that whether this is good enough or strong enough… I don’t really think that there are too many countries in the world that can have 7.6-percent growth, a very stable one,” he said.

“I understand that of the 7.6-percent growth rate, 7.5 percent can be attributed to domestic demand, so we are talking about really ‘solid’ growth, perhaps not 10 percent like China used to have,” he added.

Jeremic praised China for showing the strength and resilience in the face of international challenges.

As to the global political and economic landscape, he believed the UN remained key to resolve the challenges in the 21st century by engaging everyone equally in the General Assembly. Although important organizations like the G20 are emerging, without the UN and UN General Assembly, there is no chance to resolve challenges in a satisfactory manner, he said.

The role of the emerging markets and developing countries will become stronger and the most significant element in this new geopolitical puzzle and the new landscape, as part of the wider global development, he noted.

The Millennium Development Goals will expire in 2015 and they need to be replaced by a new vision for world development for the next 20 to 30 years, he said.

World leaders at the Rio+20 conference in June 2012, agreed for the General Assembly to draft a development agenda for the 21st century. Over the next 24 months, the assembly will need to complete negotiations, achieve a consensus so the world will develop in a sustainable way, not exacerbate social differences and tensions in a country and between countries, and make the gap between the rich and poor smaller.

Jeremic said China plays a critical role in this process and looks forward to working with the country, hoping it will continue to play a constructive role in the UN.

Jeremic will be replaced by John William Ashe, ambassador to the UN for Antigua and Barbuda, for the 68th session in September.

Tough job market for over three million college students: official

A dismal job prospect is expected to unfold itself for China’s numerous college graduates, as over three million college students could fail to land a job this year, some official estimated in a press conference yesterday.

The figure was revealed by Wang Yujun, a senior official of the Ministry of Human Resources and Social Security, in the media briefing for the annual report of the reform and development of China’s social security.

Against the backdrop of a record high number of graduates nearing seven million this year, more than three million college students could probably not find a job before graduation, said Wang.

She claimed that the estimation is made by taking into account of the initial employment rate which exceeds 70 percent in previous years.

The initial employment rate refers to the percentage of graduates who have secured a job before leaving the campus, which also encompasses those who have enrolled as post-graduates or by a foreign university.

The employment difficulty is caused not only by the nation’s education mode and students’ career vision, but also the quantity and quality of the job vacancies at present, Wang added. She predicted that the situation can hardly get better in a few years to come.

Job opportunities in China at lowest level since 2010

Employers in China are decreasing their expected hiring, shows a recent report by the recruitment firm Hudson. They estimate an index, measured through interviews with employers, that tracks the expected hiring for the next quarter.

The figures for the third quarter of 2013 are reported as the lowest since the beginning of 2010.

Fewer jobs and more applicants

Bi Lin, joint general manager for Hudson in Shanghai explains the reasons he sees for such a reduction. In an interview with China Daily he says, “The government’s support of quality growth has resulted in a slower rate of growth, as many organizations are focusing on achieving internal efficiency and productivity gains in the first instance rather than adding headcount.” Of the 816 companies interviewed by Hudson, 13.2% said they would reduce their headcount in the next quarter. This is a 6.2% rise over the previous quarter.

The problem for job applicants is twofold. Along with the predictions from Hudson of declining recruitment, there are also a rising number of applicants for positions. This is blamed on several factors, including the closing of a number of export-focused companies amidst economic difficulties globally, and also an increase in the number of Chinese currently overseas returning to China due to the same economic difficulties.

Differences across the sectors

The hiring and job situation is quite mixed amongst the different sectors of the market. The Hudson report identifies stronger hiring intentions for highly qualified and specialized workers, in particular those in research and development, chemicals, healthcare, laboratory roles, and digital marketing.

The property and construction sector is seen as the industry with the most opportunity, with strong growth in hiring. This is due to the continued strength of commercial and retail property, with a strong domestic demand unaffected by overseas economic difficulties or tightening regulations for overseas capital in China.

Healthcare, too, has strong potential. 71.2% of respondents in this sector indicated increased hiring intentions for the next quarter. Bi explained that this is due to the upcoming plans of a number of global pharmaceutical companies currently establishing research and development centers in China increasing their demand for employees.

Specialized newsrooms abuzz on WeChat

Social media cater to public demand for concise, customized information

Lu Jiuping starts working at 4 am every day, but the retired 50-year-old businessman has never made a cent from his current occupation.

He starts his day by reading several financial websites, picking out valuable bits of business or IT news.

Not satisfied to digest the information alone, he posts these news items on “Tearoom 90”, an official account he registered on WeChat, a popular mobile social networking platform developed by Chinese IT giant Tencent.

Since it was set up in February, Lu’s free subscriber service has attracted a readership of more than 14,000, quickly turning it from a “tearoom” to a “newsroom”, much to the delight of the amateur media strategist.

“I am working as the chief editor of an e-magazine,” Lu said.

The Official Account is one built-in WeChat function that offers broadcast messaging. Operators of each account can share anything in any format with their subscribers and receive instant feedback.

According to Tencent’s website, the platform was originally created for big brands, such as airlines, banks and celebrities, but it has unexpectedly struck a chord with the public and citizen reporters, like Lu, who are taking advantage of the platform to develop specialized storytelling styles.

In the past few years, Sina Weibo, China’s most popular Twitter-like service, has exploded in popularity. Millions of Weibo users use the service to speak their mind.

Platforms such as Sina Weibo and WeChat are changing the way media work, with netizens now discovering and discussing social events online.

However, spam and misinformation have grabbed onto the coattails of the service, and people are getting tired of irrelevant or boring micro blogs that pop up on their screens all day.

Lyu Xin, dean of the New Media Department of Animation and Digital Arts School at Communication University of China, described this as the “parabola” of social media development.

He said that the rise of micro-blogging inspired people from all walks of life to voice their opinions on social issues, breaking down traditional media’s long-held domination over the spread of information and speeding up information transmission.

As they become increasingly immersed in social media, however, users find that it gets “boring” to sift through massive amounts of irrelevant information to find news that interests them. Instead, they prefer to spend their time perusing concise and well-organized information delivered to them directly.

“The parabola has reached its peak, and it will go down,” said Lyu, “but people’s demand for social media will go up.”

The professor attributed the popularity of WeChat to the platform’s ability to push content that meets public demand.

“In the social media age, no dish suits all tastes. People need more information to serve their personal interests. The Official Account on WeChat provides a venue for both institutions and individuals to publish their personal information,” one blogger wrote.

Lu’s case helps to illustrate that point.

He describes his “Tearoom 90” as a professional business magazine. “My target customers are industry insiders, and those gossip girls or boys have little interest in following.”

The customized information helps to attract people with shared interests to subscribe, but subscriber-only content, which only subscribers can read or comment on, could be used to broadcast false information.

Many national newspapers, magazines and websites have also landed in the platform.

In April, China Central Television, a State-owned broadcaster, launched its official WeChat account “CCTV News” to spread news reports and photos, as well as receive reader comments.

Government departments have also opened accounts for hearing opinions from the public. According to a report released in May by Tsinghua University, the number of government accounts on WeChat has reached 1,000 across China.

Spending linked to social security

Many people were surprised to find that China’s average individual savings had reached 77,623 yuan ($12,645). But no matter how high or low the figure is, Chinese people are not likely to exchange happiness for consumption, says an article in Beijing Morning Post. Excerpts:

The announcement of the national average individual savings data could be demoralizing for people who don’t have that sort of savings. In fact, many netizens have made fun of the latest savings data by saying that they will try to catch up with the national average by surviving without food and drinks.

The average savings rate may not mean much in times of wide differences in consumption, financing, investment and earnings, especially when depositing money in banks has become the least lucrative means of wealth management.

As a country that tops the global savings rate, China has a huge number of people who are reluctant to spend more and thus boost domestic consumption to help the country’s economic growth. If savings is only about mere accumulation of money in banks, wealth management will not help national economic development.

Chinese people will really feel happy when they have enough in bank deposits even after spending more than usual, which means they should have enough cash in hand or bank to deal with emergencies, such as paying for housing, medical care and their children’s education.

Therefore, only if the government increases its input in social security will Chinese people spend more instead of depositing their money in banks.

Jobless graduates may exceed 3 million

Over 3 million graduates in China are struggling to find jobs this year, according to a report on China’s social security, released on Sunday.

With nearly 7 million graduates this year, and adding on the unemployed students from previous years, the number of graduates struggling to find jobs before leaving school is estimated to have reached over 3 million, said Wang Yujun, from the Ministry of Human Resources and Social Security, at a press conference for the “2012 China Social Security Reform and Development Report”.

The report also said that delayed retirement is not a viable option at present, as the current conditions are insufficient.

The job market is unable to fulfill the demands of job hunters, with 30 percent of new job vacancies coming from the retired, according to Professor Deng Dasong of Wuhan University.

In China, calls are being made to delay the retirement age from 60 to 65, as the aging population continues to grow rapidly.

Plight of Chinese hawkers highlights impact of downturn

Every year the scorching Chinese summer brings throngs of unlicensed vendors out on to the streets, hawking everything from pirated DVDs to watermelons.

Given their lowly and illegal status they are often treated poorly by the authorities, but this year has been particularly bloody for this army of mobile shopkeepers.

Two weeks ago, Deng Zhengjia, a 56-year-old watermelon vendor, was killed and his wife knocked unconscious after they were attacked by the local “chengguan” – an auxiliary police force tasked with keeping city streets clean and orderly.
Since then there have been a dozen similar incidents reported across China in which “melon-peasants” (as they are referred to in Chinese), street hawkers, journalists and even police officers have been beaten up by locally-employed chengguan.

Chengguan brutality is not new, but experts say rising unemployment, particularly in the low-end export-orientated manufacturing sector, is driving up the number of vendors and prompting many more confrontations on the streets.

“The economic downturn has caused an increase in the unemployed and low-income populations and they have to return to the labour market which inevitably increases the conflict between chengguan and street vendors,” says Qiu Jianxin, an expert on the chengguan at Nanjing Aeronautics and Astronautics University.

Official Chinese unemployment data are virtually meaningless as they do not count the country’s hundreds of millions of migrant workers. According to a government manufacturing sector survey published on Thursday, however, employment in the sector has contracted for 13 months. A separate survey published by HSBC showed that the number of workers in the manufacturing sector shrank in July at its fastest pace since March 2009, with expectations of further job cuts.

The government has said 7.25m jobs were created in the first half of the year. But another survey from the Ministry of Human Resources and Social Security found that the number of new urban jobs fell by 5.7 per cent in the second quarter from the same period a year earlier.

“The employment situation is weakening in China,” says Zhu Haibin, chief China economist for JPMorgan. “The service sector is creating some jobs to hold up the overall labour market conditions but low-skilled manufacturing employment is particularly weak.”

A researcher at a government think-tank, who asked for anonymity, estimated that in some export-orientated manufacturing zones in south China one-third of migrant workers were still employed in factories, another third had switched to employment in the services sector while the final third had returned home to the countryside.

This balancing effect means China has not yet seen widespread net lay-offs despite three years of steadily slowing growth – from almost 12 per cent expansion in early 2010 to 7.5 per cent growth in the second quarter this year.

Without the pressure of massive unemployment the government has been unwilling to launch a major stimulus package to boost the economy as it did in late 2008 in the face of the global financial crisis. But the overall employment figures disguise the shifts that are occurring in the labour market and the potential dangers for China’s stability-obsessed government.

As news of Deng’s death in central China spread on social media, it caused outrage throughout the nation that was even expressed in official media outlets.

Local government officials in charge of the chengguan initially claimed he had “suddenly fallen to the ground and died”. But Beijing soon ordered the arrest of the officers involved and arranged for his family to receive a large payout.

“The government paid off the family quickly to shut them up because they are very worried this incident could spark wider protest or some sort of popular movement,” says Yang Jisheng, deputy editor at the reformist magazine Yanhuang Chunqiu.

Apart from there being fewer available jobs in the manufacturing sector there is also a mismatch between the jobs available and the skills and ambitions of those entering the workforce.

“There are studies that show a connection between unemployment and the number of street vendors in China,” says Ye Tan, a popular columnist who has written extensively about the chengguan. “But for many vendors the problem is not that they can’t find a job, but that they are unwilling to work long hours in high-risk manufacturing jobs.”

Because street vending is the main source of income for many of these migrants, the stakes are high when they are caught by chengguan, who regularly confiscate all of their wares and income. The chengguan often ask for protection money from vendors and regularly conduct street raids that can sometimes turn violent.

Just one day after Deng was killed, another melon vendor in northeast China was beaten up by chengguan in his city, in an incident that was captured on camera phones by witnesses. The footage was replayed by a regional state-controlled TV station whose journalists were themselves attacked by chengguan on camera when they went to the chengguan’s offices to check the facts of the case.

A week later, a police officer was reportedly beaten and had his pistol grabbed by a group of chengguan in western China after he was called to an incident in which the chengguan were attacking people.