Archives August 2009

Jobless rate increases to record high in Taiwan

TAIWAN’S jobless rate hit a record high of 6.1 percent in July, authorities said yesterday, as new graduates entered the job market and started to look for work amid a recession.

A total of 663,000 people were unemployed, up from 647,000 in June. It was the third straight month Taiwan’s unemployment rate hit a record high.

The loss of temporary jobs was another factor for rising unemployment, authorities said.

Taiwan’s economy contracted 7.5 percent in the second quarter, and the government has predicted gross domestic product to shrink 4 percent this year.

A devastating typhoon this month has resulted in more than US$2 billion in farm and property damage, but its impact on the economy will be offset by huge government reconstruction spending, officials said.

Taiwan approved a NT$100 billion (US$3 billion) rebuilding fund to be spent over the next three years.

American Graduates Finding Jobs in China

BEIJING — Shanghai and Beijing are becoming new lands of opportunity for recent American college graduates who face unemployment nearing double digits at home.

Even those with limited or no knowledge of Chinese are heeding the call. They are lured by China’s surging economy, the lower cost of living and a chance to bypass some of the dues-paying that is common to first jobs in the United States.

“I’ve seen a surge of young people coming to work in China over the last few years,” said Jack Perkowski, founder of Asimco Technologies, one of the largest automotive parts companies in China.

“When I came over to China in 1994, that was the first wave of Americans coming to China,” he said. “These young people are part of this big second wave.”

One of those in the latest wave is Joshua Arjuna Stephens, who graduated from Wesleyan University in 2007 with a bachelor’s degree in American studies. Two years ago, he decided to take a temporary summer position in Shanghai with China Prep, an educational travel company.

“I didn’t know anything about China,” said Mr. Stephens, who worked on market research and program development. “People thought I was nuts to go not speaking the language, but I wanted to do something off the beaten track.”

Two years later, after stints in the nonprofit sector and at a large public relations firm in Beijing, he is highly proficient in Mandarin and works as a manager for XPD Media, a social media company based in Beijing that makes online games.

Jonathan Woetzel, a partner with McKinsey & Company in Shanghai who has lived in China since the mid-1980s, says that compared with just a few years ago, he was seeing more young Americans arriving in China to be part of an entrepreneurial boom. “There’s a lot of experimentation going on in China right now, particularly in the energy sphere, and when people are young they are willing to come and try something new,” he said.

And the Chinese economy is more hospitable for both entrepreneurs and job seekers, with a gross domestic product that rose 7.9 percent in the most recent quarter compared with the period a year earlier. Unemployment in urban areas is 4.3 percent, according to government data.

Grace Hsieh, president of the Yale Club in Beijing and a 2007 graduate, says she has seen a rise in the number of Yale graduates who have come to work in Beijing since she arrived in China two years ago. She is working as an account executive in Beijing for Hill & Knowlton, the public relations company.

Sarabeth Berman, a 2006 graduate of Barnard College with a major in urban studies, initially arrived in Beijing at the age of 23 to take a job that would have been difficult for a person her age to land in the United States: program director at BeijingDance/LDTX, the first modern dance company in China to be founded independently of the government.

Ms. Berman said she was hired for her familiarity with Western modern dance rather than a knowledge of China. “Despite my lack of language skills and the fact that I had no experience working in China, I was given the opportunity to manage the touring, international projects, and produce and program our annual Beijing Dance Festival.”

After two years of living and working in China, Ms. Berman is proficient in Mandarin. She travels throughout China, Europe and the United States with the dance company.

Willy Tsao, the artistic director of BeijingDance/LDTX, said he had hired Ms. Berman because of her ability to make connections beyond China. “I needed someone who was capable of communicating with the Western world.”

Another dynamic in the hiring process, Mr. Tsao says, is that Westerners can often bring skills that are harder to find among the Chinese.

“Sarabeth is always taking initiative and thinking what we can do,” he said, “while I think the more standard Chinese approach is to take orders.” He says the difference is rooted in the educational system. “In Chinese schools students are encouraged to be quiet and less outspoken; it fosters a culture of listening more than initiating.”

Mr. Perkowski, who spent almost 20 years on Wall Street before heading to China, says many Chinese companies are looking to hire native English speakers to help them navigate the American market.

“I’m working with a company right now that wants me to help them find young American professionals who can be their liaisons to the U.S.,” he said. “They want people who understand the social and cultural nuances of the West.”

Skip to next paragraph Mr. Perkowski’s latest venture, JFP Holdings, a merchant bank based in Beijing, has not posted any job openings, but has received more than 60 résumés; a third are from young people in the United States who want to come work in China, he said.

Mick Zomnir, 20, a soon-to-be junior at the Massachusetts Institute of Technology, is working as a summer intern for JFP. “As things have gotten more difficult in the U.S., I started to think about opportunities elsewhere,” he said. He does not speak Chinese but says he will begin studying Mandarin when he returns to M.I.T. in the fall.

A big draw of working in China, many young people say, is that they feel it allows them to skip a rung or two on the career ladder.

Ms. Berman said: “There is no doubt that China is an awesome place to jump-start your career. Back in the U.S., I would be intern No. 3 at some company or selling tickets at Lincoln Center.”

For others, like Jason Misium, 23, China has solved the cash flow problem of starting a business. After graduating with a degree in biology from Harvard in 2008, Mr. Misium came to China to study the language. Then, with a friend, Matthew Young, he started Sophos Academic Group, an academic consulting firm that works with Chinese students who want to study in the United States.

“It’s China’s fault that I’m still here,” he said. “It’s just so cheap to start a business.” It cost him the equivalent of $12,000, which he had in savings, he said.

Among many young Americans, the China exit strategy is a common topic of conversation. Mr. Stephens, Ms. Berman and Mr. Misium all said they were planning to return to the United States eventually.

Mr. Woetzel of McKinsey said work experience in China was not an automatic ticket to a great job back home. He said it was not a marker in the same way an Ivy League education: “The mere fact of just showing up and working in China and speaking Chinese is not enough.”

That said, Mr. Woetzel added, someone who has been able to make a mark in China is a valuable hire.

“At McKinsey, we are looking for people who have demonstrated leadership,” he said, “and working in a context like China builds character, requires you to be a lot more entrepreneurial and forces you to innovate.”

HK jobless rate reaches 5.4%

Hong Kong has reported a 5.4 percent unemployment rate between May and July, up from 3.3% in April to June.

Although it’s a jump, authorities say it’s better than expected, and the labor market is stable. The 5.4 percent rate means the city has 10 thousand more jobless in the three months, taking the total above 210 thousand.

Local government says the figure is better than expected. Most job losses during the period have been in decorating, finance and the entertainment sector. The unemployment rate in the construction industry is the most severe, at 11.1 percent, but it’s lower than the previous month.

Unemployment in the finance sector has also fallen a little to 2.4 percent. Authorities said companies have made great efforts to provide more job opportunities in the past few months.

China can achieve 2009 employment targets

At present, China’s employment situation remains stable and some positive changes have emerged. Human Resources and Social Security Minister Yin Weimin said that he is confident that all the current annual employment targets will be achieved.

In the first seven months of 2009, China created 6.66 million new urban jobs, 970,000 of which were created in July. In this period, 3.15 million laid-off workers were re-employed and 930,000 people facing employment difficulties found jobs, which is overall better than expected.

At the beginning of 2009, China set employment targets requiring that 9 million new urban jobs be created over the year and registered unemployment rate be controlled below 4.6 percent. In the first seven months, the number of newly-created jobs has already accounted for 74 percent of the target, and the registered unemployment rate stood at 4.3 percent as of the end of second quarter, curbing the upward momentum which has existed since the end of last year. The number of monthly newly-created jobs in cities and towns has basically stabilized since the second quarter.

The monthly increment of about one million employment opportunities is essentially maintaining the same level as that recorded before the outbreak of the international financial crisis. This indicates that China’s employment has gradually bottomed out.

Yin said that in order to achieve the annual employment target, in addition to continuing to boost employment by closely integrating the expansion of domestic demand with economic development, implementing more active employment policies and strengthening training will also improve employability. Priority should also be given to promoting the tertiary industry and small and medium-sized enterprises to stimulate employment.

However, according to overall analysis, the current conflict between labor force oversupply and shrinking demand is still acute. According to the latest estimates from the Ministry of Human Resources and Social Security (MHRSS), there will be over 24 million people in need of employment in 2009. “If calculated on the basis of an eight percent economic growth rate, only about 12 million new jobs can be provided after a whole year’s economic growth. The gap between supply and demand will further widen compared to that of 2008,” said an MHRSS official.

Fiscal talent, IT wizardry high on agenda

Howard Yan graduated with a bachelor’s degree in computer science in England in 2005 and set up a company selling electronic navigation systems in the United Kingdom and other countries. Pinched by poor profits when the global financial crisis hit, he returned to Shanghai last year.

Yan now works for Shanghai Information Investment Inc, a state-owned enterprise focused on strategic investment in the city’s information technology infrastructure.

“I can contribute my knowledge in computer science,” he said. “Moreover, the city’s financial sector will become even more important after the crisis.”

Yan is one of many who see opportunities unfolding after the State Council gave Shanghai the green light to transform itself into a major international financial center and shipping hub by 2020.

Financial services, one of the most important sectors in the government’s grand plan, is expected to need a lot of the kind of talent Yan can offer.

The financial sector in Shanghai has a total employment of about 230,000 by the end of 2008, about 2 percent out of the total 10.53 million employees in the city, according to an annual report by Shanghai Statistic Bureau.

New York, in contrast, has a total number of 464,400 in the financial sector, 14.5 percent that of its total employment by the end of 2008, according to the New York State Department of Labor.

The quality and quantity of Shanghai’s financial talent will have a direct influence on the pace of progress in achieving the city’s ambitions, according to the Blueprint for Shanghai’s Development as a Financial Center, a report by three financial professors at Shanghai Finance University.

“Shanghai should have at least 1 million employees in the financial sector and related industries,” said the report. “We’re facing increasing pressure as our business in China is expanding very rapidly,” said Huang Qiumei, director for human resources at Standard Chartered (China).

“Our staff on China’s mainland will exceed 4,000 very soon, compared with an initial 1,200 employees,” she said.

“It’s hard to say in which sector in Shanghai is most short of financial experience,” said Zhou Lin, deputy dean and professor at the new Shanghai Advanced Institute of Finance in Shanghai Jiao Tong University.

The institute was founded in April with a six-year grant of 320 million yuan (US$46.8 million) from the city government.

“Setting up a structured method to allow enterprises and employees to develop at the same time may prove efficient for Shanghai to expand its talent pool,” Glynn Lowth, president of Chartered Institute of Management Accountants, told a media briefing in Shanghai in April.

“There is still not enough financial talent familiar with international financial operations, and the problem lies in the shortage of qualified college faculties,” Zhou said.

Most professors in domestic universities focus on macroeconomics and currency policies; few of them have experience in capital markets and corporate operations.

Balanced approach

“We have designed courses to better suit the current economic situation, and with professors having rich experience in practical applications, we hope we can educate our students with international vision,” he added.

The college is expecting to graduate 500 students with master’s degrees in finance every year in eight or 10 years’ time.

“Shanghai must speed up the nurturing of financial professionals as well as attracting more Chinese and overseas experts to the city,” said Fang Xinghai, director of the Shanghai government’s Financial Services Office.

“It is not practical to fully rely on recruiting financial talent from overseas because our financial markets are not yet fully developed,” Zhou said.

Standard Chartered is adopting a balanced approach.

“We want local talent as well as overseas staff to help our development,” Huang said. Right now there are more than 300 staff from the overseas branches of Standard Chartered working in Shanghai.

China’s capital markets still lag their Western counterparts, and highly qualified staff are considered key to closing the gap.

“Fostering financial talent and developing financial markets are both important and can be done at the same time,” said Zhou.

For his part, Yan has enrolled in a postgraduate MBA course at Shanghai Advanced Institute of Finance and will start his studies in September.

“I hope I can secure a better job – and also contribute to the city’s financial services sector in the future,” he said.

Samsung Securities is hiring 50

Samsung Securities Co. is hiring 50 people in Hong Kong by the end of this year. According to Bloomberg, the South Korean firm is just launching an office in Hong Kong to expand its services for capital raising, acquisitions, stock trading and capital management.

Samsung Securities is also expanding to begin operations in China, Taiwan, Japan, Singapore and India through internal growth, partnerships and M&A. In fact it may consider a joint venture in China in order to begin operations there in two or three years, according to the report.

R&D hiring in China flat: Microsoft

RECRUITMENT at Microsoft’s largest research centre outside the US will be flat next year, a senior company executive said.

Microsoft China employs around 3500 research and development staff — more than a five-fold growth since 2005.

The work done at the China research lab is for global consumption; some of its more recent efforts can be found in Microsoft’s new operating system, Windows 7.

According to Ya-Qin Zhang, Microsoft corporate vice-president and chairman of its Beijing-based R&D group, staffing levels are adequate at the moment.

“In 2005 we had about 600 people in R&D in China. Now we’re at 3500 researchers and engineers but next year hiring will be flat,” Dr Zhang said.

The Beijing R&D group is divided into three streams — the product group works on existing products, incubation looks at next-generation products, and research has an eye on future products.

“The product team has the highest number of staff at around 80 per cent, while product and incubation have 10 per cent each.”

Dr Zhang’s research staff were responsible for a few features in Windows 7, including systems recovery and diagnosis, speech technology and multi-touch.

Microsoft US has the largest research and development group within the company, employing around 30,000 people.

Dr Zhang singled out smart devices, cloud computing, natural language, search and graphics as focus areas for the R&D group.

“We’re looking at how we can extend the capabilities of a computer and put in more intelligence in devices,” he said. “Smart sensors would be one area that we will see a lot of work in.

“But I personally like to keep it simple … technology should be simple, not complex,” he said, citing that as the reason why he doesn’t use a touchpad smart phone.

He dismissed backers of an all-or-nothing approach to cloud computing, saying most critics tend to forget the client’s role in the equation.

“I’m against talk that everything sits in the cloud and the client isn’t important. The two work hand in hand — cloud and client. How information is accessed is very important.”

Microsoft is pushing its Software-plus-Services vision for both public and private clouds.

The software giant increased its global R&D budget by $US1 billion to $US9bn this year, chief operating officer Kevin Turner said during a visit to Sydney in April.

Dr Zhang was in Sydney to officially open the National ICT Australia’s Techfest09 event yesterday; he has rejoined Nicta’s International Advisory Group after a brief hiatus.

Dr Zhang commended Nicta for the high standard of research being conducted and said both organisations shared the same vision.

“I’m excited to see that Nicta and Microsoft share the same model of taking risks,” he said.

At Techfest09, Nicta unveiled a new software component dubbed sel4 that ensures an operating system will “never” crash has been developed in Australia. It has the potential to earn billions of dollars in royalties.

China to release document regulating SOE executive salaries

A Chinese official says the government is writing up a document to more effectively regulate State-owned enterprises (SOEs) as well as executives’ salaries.

Hu Xiaoyi, Vice Minister of Human Resources and Social Security said the document would be released in the near future during an Aug. 4 press conference held by the State Council Information Office.

Hu said two steps would be taken to regulate SOE executives’ salaries. The government will firstly regulate the salaries of SOE executives in central enterprises and then instruct local governments on setting the salaries of those executives running local companies.?

“Five principles are used to formulate this document,” Hu explained. “We should combine market regulation with government supervision; strike a balance between short-term and long-term financial incentives for their achievements; improve salary regulations; provide insurance for employees; and coordinate salary increases for executives of SOEs and for employees.”

Jobs increase in second quarter

China saw a slight increase in jobs in the second quarter while its urban unemployment rate stayed at 4.3 percent, bucking a global shrinking job market, the Ministry of Human Resources and Social Security said Friday.

From February to June, the number of jobs grew by 0.13 percent over the previous quarter (October 08 – January 09), according to a ministry survey of more than 513 major companies in five provinces.

“It is a very slight but very positive change,” ministry spokesman Yin Chengji said.

The number of jobs fell by 8.05 percent between October and January, but the government’s stimulus package helped stem urban unemployment after two consecutive increases since the fourth quarter last year, he said.

Due to the global economic slowdown, the jobless rate rose to 4.2 percent in the fourth quarter last year – the first increase in five years, before hitting 4.3 percent in the first quarter of this year.

The ministry aims to keep the unemployment rate below 4.6 percent this year, which would still make it the highest level of unemployment since 1980.

The jobless rate does not include the country’s 230 million migrant workers, who make up the main workforce in the labor-intensive industries of the coastal regions.
Officials from the National Bureau of Statistics had earlier said that more rural migrant workers found jobs in cities in the second quarter, up by nearly 4 million from the first quarter.

“The employment situation has been stabilizing after the rebound in the first quarter,” Yin said. “It is better than expected.”

The ministry has achieved more than half of its goals in the past six months, creating jobs for 5.69 million new urban workers, 2.71 million laid-off workers, and 790,000 people who were facing difficulties finding work, officials said.

This year, the ministry aims to create jobs for 9 million new urban workers, 5 million laid-off workers and 1 million others encountering difficulty finding work.

6 talents succeed at AVIC’s global recruitment drive

Six talents were selected to be vice-presidents of five subsidiaries under Aviation Industry Corporation of China (AVIC) on August 5. This marks the successful conclusion of AVIC’s global recruitment drive to find top executives.

It is the first time for Chinese security enterprises to seek high level executives worldwide. All of the jobs were open to foreigners and the search was not limited to China-born managers. The recruitment drive was launched on Feb. 26, 2009 and around one thousand applicants from over twenty countries and regions had signed up.

According to the company, most of the six executives had worked for large scale state-owned enterprises (SOEs) and governments before. As all of the jobs will involve dealing with some of the corporation’s restricted information, background checks will be performed on them. They are also asked to sign confidentiality agreements.

AVIC is the first Chinese aerospace manufacturer and security company listed in the Fortune Global 500, ranking 426 in this year’s list released on July 8.

AVIC is the originator of AVIC Commercial Aircraft Engine Company, which will engage in research, design, production, sales, maintenance, service and technological consulting for jet engines and related products. AVIC holds a 40 percent stake in this new company.