Archives October 2008

China and Emerging Markets May Draw Talent from Waning Wall Street

Thousands of financial workers on Wall Street are losing their jobs during this financial crisis, leading to a great dislocation of financial talent.

The so-called hot job and hot department in the financial industry will be redefined. Enthusiasm over investment banks such as Goldman Sachs and Lehman Brothers will wane, and attention will move back to the steadier, more conservative, and less risky financial institutions such as commercial banks. The internal structure of financial institutions such as banks and insurance companies will also change. Some functions such as risk management, which used to be neglected, will be repositioned and revalued. Some financial workers will have to change their professional orientation, since positions related to investment will weakened or even disappear.

Compensation and professional quality in the financial industry will also be redefined. Greed and lack of self-discipline are at the root of the financial crisis. Wall Street, with its high compensation and luxurious life styles, brought too many dreams and too much pride to too many young people, where a graduate could get a high salary fresh out of school. But now things will calm down. Too much risk lies behind irrational success and irrational wealth growth.

In the following years, the former attractiveness of investment banks, mutual funds, hedge funds, private equity funds, and leverage buyout funds is going to fade. With the crazy age coming to an end, compensation levels on Wall Street will no longer be No. 1 in the US. Wall Street will no longer be the only choice of top MBA graduates, as they will once again consider traditional and high-tech industries. High quality professional managers with will also flow to other industries.

Since the crisis, people begin to consider the ethical standards of the financial system. Wall Street and European financial markets are all considering what kind of senior managers, CEOs, and CFOs financial firms need. Further lessons on how to avoid and control risk are being learned by financial institutions. What kind of culture should be admired in financial firms? In the past, the trader, passionate, adventurous and ready to go to extremes, was the admired model. But now, at least for a while, banks are laying off the traders, and risk managers are not only keeping their jobs but being poached and headhunted as banks seek to shore up their internal control departments.

China’s industry will be more attractive to Chinese financiers. Due to downsizing in the US, Chinese employees there will also be looking for jobs. Under the circumstances, coming back to China may become their best choice. At least China’s overall economic and financial situation is still better than the US and Europe. Now many Asians are considering returning to their emerging markets, as they are more likely to find jobs there, even though the financial markets in these countries are far from their expectations. This may trigger a series of talent competitions among domestic financial institutions.

In fact, more and more western professional managers, having faith in opportunities and challenges in China and its neighboring markets, were participating in the domestic financial talent competition before the outbreak of the subprime crisis. But now the requirement for talent in the domestic financial market will include not only professional knowledge and financial management skill, but also the knowledge about China’s local culture and commercial environment, which will be as important as financial tools for some positions.

Chinese Goverment picks up $3.5m wage bill

More than 24 million yuan ($3.5 million) of public funds has been used to compensate 7,000 former employees of collapsed toy maker Smart Union Group, a senior local official said yesterday.

In an interview with the Xinhua News Agency, Xu Hongfei, deputy head of Zhangmutou in Guangdong province, where the Hong Kong listed firm operated two factories, said the town government had agreed to reimburse all those who lost their jobs on October 15.

“The boss is nowhere to be found, so the government is paying the wages owed to the workers,” he said.

Former employee He Ming said yesterday he had been given 1,800 yuan for the 13 days he had worked this month.

“My monthly pay was about 3,000 yuan, so the money I got from the government was about right. I’m satisfied,” he said.

While the government has agreed to cover back pay, it will not, however, finance any redundancy payments owed by the firm, Xu said.

About 1,000 former employees have hired lawyers to help them seek compensation from Smart Union, Xinhua said.

The Zhangmutou government will do all it can to help find new jobs for those who were made redundant, Xu said.

Meanwhile, in neighboring Shenzhen on Tuesday, the city government used 3.7 million yuan of pubic funds to cover back pay owed to some 800 workers left jobless with the demise of Chuangyi Toys Co Ltd, the boss of which has been missing since Oct 14.

A source with the Pingshan community office, where the Hong Kong funded firm was based, told Xinhua that local labor authorities had secured the company’s assets and will auction them off at a later date.

In another development, the government of the Longguan district of Shenzhen is currently deciding what action to take following the closure on Monday of the Hong Kong funded Gangsheng Electronic (Shenzhen) Co Ltd.

“A working group comprising representatives of the police, courts, and the labor and social security bureau, has been set up to investigate the case,” Peng Gang, an official with the district publicity department, told China Daily yesterday.

Also, on Tuesday, the Shenzhen labor and social security bureau publicized the names of 30 companies that owe in excess of 12 million yuan in back pay to their workers, and demanded their executives report to local labor authorities within 30 days.

Yang Baohua, deputy director of the Shenzhen labor bureau said that since June, the city government has paid out more than 10 million yuan to cover wages owed to laid off workers.

China to amend law for smoother state compensation procedures

BEIJING, Oct. 23 (Xinhua) — China on Thursday discussed drafting an amendment to the state compensation law, which would guarantee smoother channels and improved procedures for victims seeking compensation from state organs.

State organs under compensatory obligations should decide whether to compensate or not within two months after receiving appeals, according to the amendment, which was being scrutinized by the Fifth Session of the Standing Committee of the 11th National People’s Congress.

Those who claimed compensation from state organs but were not satisfied with the result, could complain to the state organs’ superior departments, the amendment said.

If they were still not satisfied or didn’t receive prompt replies, they could appeal to the courts at the same level, according to the draft.

Problems including insufficient law enforcement against state organs under compensatory obligations, delays in making decisions and delivering compensation and a shortage of financing support had made it difficult for victims to protect their rights and interests, said Li Shishi, head of the Legislative Affairs Commission of the NPC Standing Committee.

“The amendment tackles those problems and will provide a quicker and easier way for them to seek compensation.”

Apart from those changes, the draft amendment would also increase an article about both victims and state organs’ obligations in providing evidence for their claims. It also, for the first time, added compensation for psychic injury.

To help victims get paid promptly, the amendment said state organs had to deliver compensation applications to the relevant financial departments within seven days of receiving a compensation invoices from the victims. The relevant financial departments should in turn pay the victims within 15 days.

The state compensation law was approved by the National People’s Congress in May 1994 and was put into effect starting in 1995.

It plays an important role in solving conflict between citizens and state organs, and to sustain social stabilities, Li said.

Shanghai companies eye Wall Street talent

Financial institutions in Shanghai are likely to start snapping up jobless Wall Street professionals by the end of this year.

Some local fund and securities companies, led by Shanghai financial working commission, may go to Wall Street later this year to hunt for possible recruits, according to a top executive from Shanghai-based fund company Huaan Fund.

“Although the city is becoming more of a player in the global financial market, we have a dearth of employees with global financial expertise,” said a senior official at the firm surnamed Xie.

He added that the company recently received a notice from the local financial working commission, but a detailed schedule has yet to be arranged.

Huaan started recruiting foreign talents for top positions in 1999. “Investment managers and legal talents from Wall Street investment banks would be our major targets. Talents with overseas backgrounds would help boost our competition in the market,” Xie said.

Some fund managers also said that the salary expectations of top Wall Street professionals may fall given the current global financial turmoil.

The local financial working commission could not be immediately reached for comment.

“Operational efficiency is critical to support portfolio realization in the financial sector, and Wall Street talent has experience of the ups and downs in financial sector business,” said Jenny Li, managing director of Hewitt Greater China, a human resources consulting firm.

Domestic companies are short of talents with leadership who can compete in a globalized economy.

“The introduction of Qualified Domestic Institutional Investors along with the opening up of renminbi business to foreign banks has provoked a huge demand for financial talents in product development and risk control,” said Christine Cheng, practice head of accounting and finance at a staffing sources firm Manpower China.

But Li warned Chinese financial players that they have to align their business strategies when hunting for various talents on Wall Street.

Nokia Siemens to Ramp Up Chinese 3G Staffing Numbers

Nokia Siemens Networks (NSN) has announced that it is to increase its TD-SCDMA trained engineers to over 1,200 staff, over an undefined timeframe. The company recently obtained the official approvals for deployment of its TD-SCDMA equipment from Ministry of Industry and Information Technology.

NSN was the major solution supplier for China Mobile Shen Zhen TD-SCDMA network’s planning, construction and optimization.

Adds Steven Shaw, head of Services in Greater China region of NSN, “We have gained invaluable experience in working with China Mobile in the Shen Zhen TD-SCDMA network. With our strong base in 2G and rich global experience in 3G deployment, comprehensive TD-SCDMA portfolio, strong local service support and clear evolution path to LTE, we are confident in helping operator customers to fulfill their goals.”

NSN shareholder, Nokia is a 49% holder in a Chinese joint venture, Potevio with China Putian to develop network infrastructure based on the Chinese 3G standard. Potevio was set up in 2005 and has also been the major supplier of equipment to China Mobile’s TD-SCDMA trial networks in Tianjin and Qinhuangdao.

Last month, Nokia’s vice-president of Greater China sales, David Tang said that the firm would launch a range of handsets based on the Chinese 3G standard.

Salary Increases Low; High Performers Are the Focus

Hewitt’s latest survey shows some employers will be giving salary increases of about one percent smaller than they would have, had the economy been looking a little better.

Hewitt’s survey of 411 large companies revealed that 42 percent of companies “are revising their salary budgets and variable pay spending strategies related to the economic downturn or because of increasing cost pressures.” Of that 42%:

49 percent plan to reduce variable compensation payouts
66 percent will cut bonuses by more than 10 percent in 2008
Salary increases will be about 3.1 percent in 2009, or about 1 percent smaller than they would have been.
Thirty-eight percent of companies are reserving part of their salary-increase budget for their highest performers. And 23 percent are creating supplemental, discretionary incentive pools for high-performers. Another 20 percent are offering employees retention bonuses for them to stay a certain amount of time.

Senior Accountant (fi193sh)

Job Title: Senior Accountant
Job Description:
Company introduction:
Our client is a TS 16949:2002 certified organization with engineering competency at their crux.
Three decades development makes our client the expert in designing and manufacturing of high technology precision engineering components viz. The company also designs and manufactures mass finishing systems for a wide variety of finishing applications on the automotive and general engineering horizons.
Their Shanghai manufactory base is looking for experienced people to join them.

Report To: GM
Location: Shanghai

Responsibilities:
1. To prepare MIS including Profit & Loss, Balance Sheet, Cash Flow on monthly basis.
2. Liaison with tax officials and should file monthly returns
3. To prepare and make monthly social insurance for employees
4. To handle all banking transactions, payments, foreign exchange transactions, overseas payments,
5. To generate monthly report of account receivables
6. To execute and increase registered capital by changing business license and liaison with Department with Foreign Investment.
7. To re-concile stocks of goods with operation

Qualifications:
1. Degree/background – Bachelor Degree in Finance or related.
2. Experience – At least 4 to 6 years working experiences in relevant functions in manufacturing or engineering industry.
3. Language – English is a must.
4. Functional Skills: Rich Experience of handling King Dee software / USFDA ; Exposure to foreign investment / foreign exchange is preferable; Execution Skills ; System Orientation
5. Be experienced in man Management
6. Strong Analytical Skills and proactive Approach
7. Age: Above 26
* Please send us your complete resume (both in Chinese and in English to: ‘topjob_fi193sh@dacare.com'(Please replace “#” with “@”)
* In the email subject MUST you plus the position name ?in either En or Ch ?

Emergency pay fund for unemployed considered

GUANGZHOU: Authorities in Guangdong will consider setting up an emergency fund to protect workers against losing their wages in the event of further factory closures, the provincial labor and social security department said on Monday.

Responding to a resolution put forward by a member of the provincial political consultative conference, the department said in a statement that the feasibility of such a fund will be considered and that financial departments at various levels will likely contribute to it.
The fund will primarily be used as insurance against firms going bust or unscrupulous bosses absconding, the statement said.

Zhang Xiang, director of the labor department, said in the statement: “From time to time, the boss of a company in financial trouble will flee and leave his debts behind, and that creates turmoil.

“In the current economic climate, there is a good chance that more companies, especially labor-intensive ones, will collapse.

“This fund would help protect against some of the financial and social problems caused by such closures.”

Zhang said that traditionally, companies paid a premium, on top of their rent, to the owners of the factory buildings they occupied.

In the event of a firm suffering financial difficulties, or the boss absconding, this money could then be used to cover wage payments for the workers.

“But the funds were seldom big enough to cover the total wage bill,” he said.

The labor department has also been urging firms to start paying their workers via bank transfer to enable closer monitoring, he said.

Furthermore, the department is currently seeking to work more closely with other local bodies, including the people’s bank, industrial and commercial administration, and the foreign trade and economic cooperation department, to develop a better picture of companies’ credit ratings.

Not everyone, however, believes the insurance fund is a good idea.

Li Qingqing, an associate professor of economics at South China Normal University, told China Daily yesterday: “Taxpayers’ money should not be used to support failing businesses.

“An infinite amount could be lost if firms continue to go out of business.

“Instead, companies should be made more responsible, perhaps by paying some form of premium when they apply for registration.”

Survey: Fund management companies offer highest earning jobs in 2007

Thanks to last year’s bullish market, the financial sector provided the most lucrative jobs in China and fund management talents topped the 2007 salary rankings, The Economic Observer reported on Monday.

Executives, fund managers and high-caliber investment researchers were the top earners, according to Taihe Consulting, a human resources company, after conducting a survey on 15 large fund management companies in Shanghai, Beijing and Shenzhen.

Industry insiders have attributed the high earnings to a shortage of fund management talents and the thriving fund businesses in 2007.

Even the current bearish market has not shown an adverse effect on fund employees’ incomes yet.

Statistics collected by Taihe in June indicated no signs of fixed income reductions among fund management employees. And flexible income was closely related to companies’ performances, it found. Some companies can still collect remarkable management fees in 2008 that are no less than last year’s, Taihe said.

The cash income of an employee comprises a fixed part and a flexible part in addition to their benefit package. The fixed part is made up of basic salary and allowances, and the flexible, accounting for 30 to 40 percent of the total income, is given as a merit-based bonus, such as year-end bonuses, or as sales commissions. Some positions even offer a flexible income that takes up as much as 50 percent of the total.

An employee with a Shenzhen-based fund management said: “The fixed salary was set at the beginning of the year, so there would be no big change. The flexible part may vary from person to person…some fund managers won’t necessarily get a smaller year-end bonus, because the payment is based on the rankings of fund performances.”

By contrast, listed securities companies already registered a year-on-year drop of 8.6 percent in salary payments in the first half of 2008, with some employees’ incomes reduced by more than 60 percent, according to a report by Shanghai Securities News in August.

From a regional perspective, fund management companies in Shanghai, a national financial hub, offered the most lucrative jobs in 2007, Taihe’s survey showed. Beijing came second and Shenzhen third.

The consulting company found that the lower-end salaries of fund management, real estate and high-tech sectors were quite similar. But at the very top level, the financial sector offered salaries that doubled what the high-tech gave, with real estate coming somewhere in between.

“Financial employees earned much higher salaries than people in the other industries in 2007,” a Taihe analyst said. “And undoubtedly the most lucrative jobs came from the fund sector.”

Hong Kong’s jobless rate climbs 3.4%

HONG KONG, Oct. 20 (Xinhua) — Hong Kong’s seasonally adjusted unemployment rate rose to 3.4 percent in July-September period from 3.2 percent in June-August 2008, reversing the decrease seen earlier in the year, revealed the latest figures released by the Census and Statistics Department here Monday.

Matthew Cheung Kin-chung, Secretary for Labor and Welfare, warned that the September figures might not have reflected the impact of the global financial turmoil, which is now beginning to be felt.

“Looking ahead, unemployment is likely to rise further in the near term,” he said, pointing to some sectors bound to be affected by a contraction in business triggered by the global economic crisis.

According to the department’s latest statistics, provisional number of unemployed persons rose by around 4,900 from 129,100 in June-August to 134,000 in July-September.

The provisional underemployment rate, however, decreased from 1. 9 percent to 1.8 percent over the same period of last year as some summer workers returned to schools upon the start of the new academic year.

Comparing July-September with June-August period, increases in the unemployment rate were mainly observed in the wholesale and retail, restaurants, manufacturing and financing sectors.

As to the underemployment rate, decreases were mainly seen in the decoration and maintenance and transport sectors.

Cheung said the Labor Department will closely monitor the situation and stands ready to help the affected employees, vowing to continue enhancing its employment services and the competitiveness of the local workforce through education, training and retraining services and job search facilitation.

“In the long run, the implementation of the major infrastructure projects will help create employment opportunities and economic benefits,” he said.

Cheung noted that the Hong Kong government had proposed to introduce a series of facilitating measures to improve the Small and Medium Enterprises (SME) Funding Schemes with a view to strengthening support to SMEs and will continue to discuss with them and listen to their views.

“I believe SMEs could benefit from these measures. I hope that employers could actively consider job restructuring or job sharing as an option to tide over the difficult period,” he added.