Recruiting in China

HONG KONG: Listed companies may lose their talented senior executives amid the economic recovery if the shareholders apply too much pressure on companies to rein in management salaries during the recession, a global human resource expert warned.

Rows over executive salaries and bonuses have intensified, as the global financial crisis wiped out significant share value on the Hong Kong stock exchange.

Minority shareholders in Hong Kong have urged senior management teams to give up their multi-million-dollar salaries and bonuses, as a token of regret for their failure to make their companies profitable.

Don Linder, practice leadership manager of global human resources organization WorldatWork, told China Daily in an exclusive interview that it is not desirable to try to cut executives' salaries and bonuses in order to comfort the minority shareholders who have seen their investment capital shrink amid the global financial turmoil.

He said that the annual bonuses for senior executives usually consist of stock options and restricted shares. The executive bonuses, therefore, align with the share performance and the success of the listed companies.

As for the salaries being undeserved, he suggested that they are automatically adjusted down as well as up, as the company's performance and fortunes change. "When the company isn't doing well or the economy isn't doing well, the executives get paid much less, just like the shareholders," Linder said, "The executives will automatically get a pay cut, if the share price falls."

Even though the senior management may have been paid less in bonuses amid the financial crisis, some chief executive officers in the US have taken bold steps forward to make their shareholders feel better.

Earlier in February, chief executive officer of Citigroup Vikram Pandit announced he would take a salary of only $1 and no bonus until the New York-based bank, which has received $45 billion bailout money from the US government, returns to profitability.

Although Citigroup is still dripping red, Pandit's determination has gained him praise and recognition in the market.

Commenting on the one-dollar executive salary, WorldatWork's Linder said the senior executives usually get very large long-term incentive packages, to offset the salary they have given up.

"It is public relations to a degree," he said, "I think it makes shareholders feel better..."

A nationwide employment campaign was launched in Shanghai yesterday (Sept 19) to provide university graduates with job opportunities in co-operation with chain stores and franchisers at home and abroad.

The campaign, sponsored by the China Chain Stores and Franchises Association, is the first of its kind in the country, and combines universities with businesses to help graduates solve the difficulty of finding jobs.

"To solve this issue, we need not only concern from the government. It's also a responsibility for chain store businesses," said Pei Liang, secretary general of the association.

Pei said many franchisers have worked out preferential policies to encourage graduates to start their own chain store and franchise business while employing some of them to work in their companies.

The campaign, which will extend to Guangzhou, Xi'an and Beijing, has firm support from the Ministry of Commerce, the Ministry of Education and the Shanghai Municipal Education Committee.

Meanwhile, an exhibition for international chain stores and franchisers opened at the Shanghai International Exhibition Center on Saturday to echo the campaign.

Many branded retailers and franchisers, including Home Inns & Hotels Management Inc and Yum! Brands Inc, introduced their management concepts and preferential policies for graduates starting businesses at the show.

"Human resources are invaluable for an enterprise wishing to lead the industry," said Sun Jian, CEO of Home Inns & Hotels Management Inc, which plans to employ 600 graduates from universities next year.

Sun's plan was echoed by Wang Hongyu, HR Director of Yum! Brands Inc China Division, who said his company has employed 3000 graduates this year and more will be hired next year.

Other firms introduced policies on loans and management subsidies at the campaign-launching ceremony to help solve funds shortage in running chain stores.

BEIJING, Sept. 24 (Xinhua) -- China's banking regulator told Xinhua Thursday night it does not place limits on the pay of the country's commercial banks' top executives.

The China Banking Regulatory Commission (CBRC) said it noted that some of the country's media reported the CBRC was drafting a document to regulate the pay of bankers from commercial banks.

Every country was trying to correct the improper incentive mechanism to curb excessive risk-taking which sparked the current financial crisis, said the CBRC.

"The CBRC has been working with other relative departments on improving the wage incentive mechanism for the country's banking industry since last year," an official from the CBRC, who declined to be named, said in response to the media reports.

"The aim was to introduce scientific guidelines on incentive mechanism by integrating executives' pay and operation risks," said the spokesman, adding the CBRC is not directly responsible for regulating bankers' remuneration.

Detailed pay setting should be determined by individual financial institutions, according to the official.

BEIJING — When the best job Mikala Reasbeck could find after college in Boston was counting pills part-time in a drugstore for $7 an hour, she took the drastic step of jumping on a plane to Beijing in February to look for work.

A week after she started looking, the 23-year-old from Wheeling, West Virginia, had a full-time job teaching English.

"I applied for jobs all over the U.S. There just weren't any," said Reasbeck, who speaks no Chinese but had volunteered at the 2008 Beijing Olympics. In China, she said, "the jobs are so easy to find. And there are so many."

Young foreigners like Reasbeck are coming to China to look for work in its unfamiliar but less bleak economy, driven by the worst job markets in decades in the United States, Europe and some Asian countries.

Many do basic work such as teaching English, a service in demand from Chinese businesspeople and students. But a growing number are arriving with skills and experience in computers, finance and other fields.

"China is really the land of opportunity now, compared to their home countries," said Chris Watkins, manager for China and Hong Kong of MRI China Group, a headhunting firm. "This includes college graduates as well as maybe more established businesspeople, entrepreneurs and executives from companies around the world."

Watkins said the number of resumes his company receives from abroad has tripled over the past 18 months.

China's job market has been propped up by Beijing's 4 trillion yuan ($586 billion) stimulus, which helped to boost growth to 7.9 percent from a year earlier in the quarter that ended June 30, up from 6.1 percent the previous quarter. The government says millions of jobs will be created this year, though as many as 12 million job-seekers still will be unable to find work.

Andrew Carr, a 23-year-old Cornell University graduate, saw China as a safer alternative after classmates' offers of Wall Street jobs were withdrawn due to the economic turmoil.

Passing up opportunities in New York, San Francisco and Boston, Carr started work in August at bangyibang.com, a Web site in the southern Chinese city of Shenzhen that lets the public or companies advertise and pay for help in carrying out business research, getting into schools, finding people and other tasks.

"I noticed the turn the economy was taking, and decided it would be best to go directly to China," said Carr, who studied Chinese for eight years.

Most of his classmates stayed in the United States and have taken some unusual jobs — one as a fishing guide in Alaska.

China can be more accessible to job hunters than economies where getting work permits is harder, such as Russia and some European Union countries.

Employers need government permission to hire foreigners, but authorities promise an answer within 15 working days, compared with a wait of months or longer that might be required in some other countries. An employer has to explain why it needs to hire a foreigner instead of a Chinese national, but the government says it gives special consideration to people with technical or management skills.

Rules were tightened ahead of the 2008 Beijing Olympics, apparently to keep out possible protesters. That forced some foreign workers to leave as their visas expired.

Some 217,000 foreigners held work permits at the end of 2008, up from 210,000 a year earlier, according to the National Bureau of Statistics. Thousands more use temporary business visas and go abroad regularly to renew them.

Reasbeck said it took her two months to find the drugstore job after she graduated from Boston's Emerson College with a degree in writing, literature and publishing. She said she applied to as many as 50 employers nationwide.

Today, on top of her teaching job, she works part-time recruiting other native English-speaking teachers. She makes 14,000 to 16,000 yuan ($2,000 to $2,300) a month.

"I could have a pretty comfortable life here on not a very high salary. English teachers are in high demand," she said.

Reasbeck said most of her college classmates are in part-time jobs or unemployed.

"People are sleeping on their mom's couches, as far as I know," she said.

While many jobs require at least a smattering of Chinese, some employers that need other skills are hiring people who do not speak the language.

Bangyibang.com's founder and CEO, Grant Yu, has five foreign employees in his 35-member work force. Yu plans to add more and said he might hire applicants who cannot speak Chinese if they have other skills.

"I don't believe language is the biggest obstacle in communication, as long as he or she has a strong learning ability," Yu said.

Feng Li, a partner in a Chinese-Canadian private fund in Beijing that invests in the mining industry, said he needs native speakers of foreign languages to read legal documents and communicate with clients abroad. He plans to recruit up to six foreign employees.

"We don't need Chinese guys who speak English like me," Feng said.

Some foreigners see China not just as a refuge but as a source of opportunities they might not get at home.

"Having one or two years on your resume of China experiences is only going to help you back at headquarters in the United States or if you apply for business schools," said Shaun Rein, managing director of China Market Research Group in Shanghai.

A 28-year-old former London banker took a job a year ago with a Chinese private equity firm after the crisis devastated his industry at home. He said that even though he spoke no Chinese, his experience and contacts made him a sought-after asset in China, a market that he said offers "a much faster route to a top-level position."

"I actually earn more out here," said the banker, who asked not to be identified by name at his Chinese employer's request. "And the hours are much shorter."

Konstantin Schamber, a 27-year-old German, passed up possible jobs at home to become business manager for a Beijing law firm, where he is the only foreign employee.

"I believe China is the same place as the United States used to be in the 1930s that attracts a lot of people who'd like to have either money or career opportunities," Schamber said.

Job hunters from other Asian countries also are looking to China.

An Kwang-jin, a 30-year-old South Korean photographer, has worked as a freelancer for a year in the eastern city of Qingdao. He said China offered more opportunities as South Korea struggles with a sluggish economy.

Still, foreigners will face more competition from a rising number of educated, English-speaking young Chinese, some of them returning from the West with work experience, Rein said.

"You have a lot of Chinese from top universities who are making $500-$600 a month," Rein said. "Making a case that you are much better than they are is very hard."

Zhaopin.com and cn.yahoo.com have sponsored human resource experts to analyze China's job market in 2010 on the basis of trends in China's economic development. Job hunters may wish to use this as a reference.

Position: On-site interpreter

Annual salary: 400,000 yuan

On-site interpreters have been labeled as the most desirable professional in the 21st century. As China adopts more international standards, economic exchanges with the outside world and international activities in China are increasing. This has resulted in an urgent demand for more on-site interpreters.

An on-site interpreter's salary depends on their work hours. Typical pay is 4,000—8,000 yuan per hour. According to information, an increasing number of large foreign enterprises will set up branches in China and Beijing in the next 4 years, and on-site interpreters will enjoy steadily increasing salaries.

Position: logistics engineer

Annual salary: 100,000 yuan at present

According to statistics released by relevant Chinese institutions, demand for logistics personnel is expanding sharply. At present, China faces a shortage of 6 million logistics personnel. Statistics also show that many logistics engineers were previously engaged in other work and very few have received professional training.

At present, only 21 percent of China's logistics professionals have university education. According to information, Shell Group offers between 6,000 and 8,000 yuan per month to fresh graduates the company employs in China.

Reporters learned that the industry will grow significantly in the next year. "At present, the basic annual salary of a logistics professional is 70,000 yuan. As the world's energy resources are shrinking, relevant Chinese professionals may receive higher salaries in four years."

Position: Environmental engineer

Annual salary: 80,000 — 100,000 yuan

Statistics show that there are only 130,000 people specializing in environmental protection in China, including 80,000 technicians. Judging from the number of environmental protection personnel in developed countries, China now needs 420,000 environmental engineers.

According to industry experts, the monthly salary of a park or garden designer, or a landscape gardener is about 7,000—8,000 yuan. With the development of China's real estate industry, the annual income of an environmental engineer will reach between 80,000 and 100,000 yuan next year.

Position: 3G engineer

Annual Salary: from 150,000 — 200,000 yuan

According to statistics released by CCW Research, China has a shortage of more than 500,000 3G professionals.

Due to the serious shortage of 3G personnel, the basic annual salary of a 3G engineer will reach between 150,000 and 200,000 yuan in 4 years.

According to Kong.net, some trends indicate that the annual salary of personnel specializing in wireless value-added services who have 2.5G technology skills is about 100,000 yuan. The salary of these individuals will certainly increase when the actual deployment of 3G technology becomes a reality.

Position: Network media professional

Annual salary: 100,000 — 120,000 yuan

Industry experts revealed that the monthly salary for a website editor currently stands at about 5,000 yuan while the salary for a manager is between 8,000 and 10,000 yuan.

"When the network media industry is able to reap a higher advertising revenue in four years time, the salary of relevant professionals will inevitably rise." This editor is quite confident about this industry.

According to this editor's estimation, the annual income for a network media professional should reach between 100,000 and 120,000 yuan in the future.

Position: Network architect

Annual salary: 100,000 — 200,000 yuan

According to zhaopin.com, the basic annual salary for a network architect who has just graduated from university and has no social experience is 80,000 yuan.

As Chinese consumers demand better network architecture services ranging from network construction to network use, and advice on work flow and resource strategy, network architects will earn more in the future.

Position: Actuary

Annual salary: 120,000 — 150,000 yuan

According to statistics released by relevant Chinese institutions, less than 10 Chinese actuaries have been accredited by the international insurance community.

HONG KONG - Hong Kong's unemployment was unchanged at 5.4 percent between June and August this year, official data showed Thursday, as economic uncertainty meant employers remained cautious about hiring.

The seasonally adjusted rate has remained the same since the April-June period.

The number of jobless increased by around 3,000 to 216,800 in the three months ending August from the May-July period, while the workforce declined by around 6,900 to 3,712,000, according to the Census and Statistics Department.

The near-term outlook will depend a lot on the pace of job creation in the economy relative to that in the labour supply, Matthew Cheung, Secretary for Labour and Welfare, said in a statement.

'As the pace of business growth remains uncertain, employers are generally cautious in hiring new hands at this point in time,' he said.

'Coupled with the relatively slow absorption of newcomers, including fresh graduates and school leavers into the labour market this year, the unemployment rate is expected to remain high in the near term.'

China announced Wednesday a guideline to regulate salaries for executives in the country's 135 centrally-administered state-owned enterprises (SOEs).

The document was jointly issued by six administrative departments of China's central government, including the Ministry of Human Resources and Social Security, Ministry of Finance, the State-owned Assets Supervision and Administration Commission, and National Audit Office (NAO).

The document set guidelines in salary structure and payment, position-related consumption, and supervision and management, in a bid to establish and perfect incentive and restraint mechanisms regulating SOE executives' salaries.

The annual salaries structure for SOE executives is composed of basic salary, pay-for-performance, and incentive earnings in the mid and long term, according to the guideline.

It stipulates pay-for-performance of executives should be based on the enterprises' business performance.

The annual salaries of executives should be in line with those for employees in the previous year, in a bid to narrow disparity between executives' and employees', the guideline said.

Departments, including the NAO and the Ministry of Supervision, will be required to monitor the implementation of the regulations, and to undertake punitive measures in the event of irregularity.

As job opportunities increase for migrant workers, companies are finding it hard to hire more workers they need. In addition, some migrant workers have chosen to stay home to develop new careers.

About 40 companies were on hand at a job fair in Zhuhai. In a complete turnaround from the past, many companies are feeling great pressure to hire enough workers.

Yuan Weiying, Zhuhai Fine Union FPC Co. said "We are short by 100 workers now. It's hard to hire a worker. We sent out a lot of hiring information to some places, but we are still unable to find one. Our current workers can not meet the production requirements."

Some companies began to show signs of an economic rebound with an increase of orders as of July. This triggered a greater demand for labor. A significant shortage of workers emerged in the Yangtze River Delta and Pearl River Delta regions. Statistics show that the shortage of workers in Chongqing city has exceeded 30,000.

One employer said "In the past, 20 to 30 people would immediately reply as soon as we posted hiring information. But now, there is no one. We needed to hire 10 to 20 workers this time, but we only hired one person."

Because of the economic rebound, company job postings have jumped by 20 percent from the same period last year. The workers' wages have also gone up by 10 percent.

When the crisis hit last year, a lot of migrant workers from Liaoning province returned home following a reduction to their income. Most of them attended local training. A year later, about 60 percent of migrant workers in the province were re-employed at home, with some even starting their own businesses.

Wang Junjie, Manager of Shenyang Fulanerte Garment Factory said "Our income shrank a lot because of the global financial crisis. So I decided to come back to create my own business. With the help of my friend, I took part in a technician training class. I learned a lot from the class. Later, I found a small-sized processing factory."

Since the crisis erupted, the local government in Liaoning province set up training classes to help workers upgrade their knowledge and skills. So far, about 170,000 workers have accepted training throughout the province.

Employees at international firms on China's mainland enjoyed more disposable income this year than last year due to a drop in inflation, according to a report released yesterday by Hay Group, a global consulting firm.

Though the average salary increase over the past 12 months from August 2008 was 5.3 percent, which is much lower than the 10.2 percent rise last year and 9.1 percent in 2007, the real wage inflation this year is 5.9 percent, even slightly higher than that before the financial crisis because of the high consumer prices in the past two years.

Real wage inflation is the average base salary movement minus Consumer Price Index, the main gauge of inflation.

"Many employees may complain they haven't got salary increase since last year. In fact they have already enjoyed a rise in disposable income, even higher than last year, due to the lower CPI," said Henry Sheng, a Hay executive.

Zhu Qingyang, an official of Shanghai Human Resource Agency Association, said: "It is difficult to foresee an optimistic future in the salary increase because of the current uncertain economic environment. We should wait and see."

Summer used to be a slow season for the job market, but things are different this year. Many companies that froze hiring since the financial crisis are recruiting again. Zhou Xiaoye has a story from Zhejiang Province in east China.

At this provincial job fair, a flooring manufacturer is collecting resumés.

The company chief says it's the first time they're recruiting since the economic downturn began.

Flooring manufacturer Rao Xianping said, "We're an export company, and we've been hit hard by the crisis. However demand is coming back now, so we need to recruit lots of staff, in every subsidiary company."

Besides the increase in export orders, the company is also optimistic about the domestic market.

Rao Xianping said, "The company has invested a lot in the domestic market, so we badly need employees in the sales and production sectors."

Another company says their biggest headache is the lack of staff to handle foreign trade.

Company recruiter Hu Ronghui said, "We'll send employees overseas as long as we recruit. "

This isn't an exceptional case. This job fair used to have more than 20 companies, but this year there are over a hundred.

Wang Changjiang, deputy firector of Zhejiang Laboe Exchange Center, said, "Starting from this May, there's been a surge in job opportunities. Through July, the number of employers increased by 30 percent, while jobs increased by 4 percent.

Jobs in textiles, electronics, machinery have increased the most, while the most wanted vacancies are for sales people and technicians.

CHINA has dropped the practice of levying full income tax on the 13th month salary, or double pay, as it wants to ensure the tax is fair, said the State Administration of Taxation yesterday.

Before the move, the 13th month pay was subject to full income tax, without deduction.

For instance, social welfare, health and public housing fund and the 2,000 yuan individual income tax threshold can be deducted from a regular monthly salary of 10,000 yuan (US$1,464) before income tax is levied. However, the full income tax was fully levied on the 13th month pay of 10,000 yuan.

The SAT was not available for immediate comment.

As the SAT doesn't usually give a clarification on a new practice, an unnamed tax industry expert with one of the big four accounting firms said there are two possibilities.

One possibility is that the 13th month pay can be deemed as a one-off whole-year bonus, which enjoys a low tax burden.

The pay is divided by 12 months and then taxed. For instance, the taxable income is 833.33 yuan (10,000/12) in the method based on 10,000 yuan monthly salary.

The other option comes with a stricter tax. The 13th month salary can be combined with the December salary for taxation. It means a higher tax with pay being doubled.

"It really depends on the explanation from the local tax man on the practice," said the source. "In practice, both methods can be applied."

Meanwhile, SAT also makes it clear that Chinese studying or working overseas can't be regarded as overseas Chinese to enjoy a bigger tax deduction.

People who obtain property rights in a divorce are exempted from income tax. But if they sell the property later they have to pay income tax on the transaction.

Job creation momentum has let the nation's minister of human resources and social security to believe that social unrest triggered by unemployment could be a thing of the past.

"I am convinced the current measures taken by the central government will prevent further social unrest from happening," Yin Weimin told China Daily on the sidelines of a press conference at the State Council Information Office.

China has not seen any social unrest so far this year - protests, riots or demonstrations - triggered by unemployment.

The minister said Wednesday that the country created 7.57 million new jobs in 2009, some 84 percent of its annual goal.

And he added that the registered unemployment rate in urban areas stood at 4.3 percent and had been stable for some time.

Experts pointed out, though, that China's urban unemployment rate excludes migrant workers, and said that segment of the Chinese workforce was hardest hit by the global financial crisis.

"Updated statistics have shown the employment situation is generally stable," the minister said.

"The worst-case scenario we prepared for earlier, in which migrant workers who lost their jobs might turn up protesting, did not take place.

"And college graduates are also quite stable, with sufficient employment measures in place," the minister told China Daily.

Government data shows that 95 percent of migrant workers had jobs last month, which was on par with the percentage working last year. And a recent shortage of labor in the Yangtze River Delta and Pearl River Delta areas, both economic heartlands, underlines the recovery of the economy and the creation of new jobs, the official said.

"This is a significant signal underlining a U-turn in China's economy," said Chen Yu, director of the China Institute for Occupation Research at Peking University.

But Yin pointed out that the overall employment situation remained "severe".

More than 30 percent of China's 6.11 million fresh college graduates were unemployed as of July and China had more than seven million young unemployed people seeking work.

About 30 percent of China's five million recently laid-off workers remained jobless in August.

Yin said the central government would invest more money to ensure additional people find work.

"Though the employment situation is brightening, the authorities should open more channels to let migrant workers know about new jobs in the coming months," said Liu Junsheng, a Beijing-based labor researcher and government advisor.

Experts welcomed the fact that the central government was placing so much emphasis on creating employment.

"Given the current measures, unemployment will be, perhaps, the last reason for social unrest in China," said Chen, from the China Institute for Occupation Research.

Because any widening of the gap in affluence between rural and urban areas could lead to social problems, the authorities have pledged more efforts to close that gap.

Hu Xiaoyi, vice-minister of the human resources ministry, Wednesday said that the government was trying to improve China's social security system. He said a rural pension program and a new cooperative medicare system were among initiatives aimed at narrowing the urban-rural gap.

The pilot rural pension program, launched in August, offers farmers older than 60 in rural areas a monthly endowment. The central government wants to roll the program out to 10 percent of counties this year and make it universal by 2020.

Minister Yin said the central government "stands firm" on its commitment to bridge the income gap between rich and poor and has plans to put a ceiling on the skyrocketing salaries of executives with State-owned enterprises.

The new document will call for executives' pay hikes to be in line with workers' increases, and the relevant union will have a say on bosses' pay, the minister told China Daily.

"The central government is clear that the incomes of the masses must grow, in line with the growing economy," he said.

Last week, the cabinet issued a new set of guidelines urging government-funded hospitals, schools and other agencies nationwide to bring in performance-related pay, instead of persisting with fixed salary increments and bonuses.

Now is traditionally the low season for recruiting migrant workers in the coastal areas where most exported goods are produced. But this year the peak season has continued and some manufacturers have found it hard to find workers.

In a labor market in Zhuhai, a southern coastal city in China, companies are trying to find the migrant workers they need, but very few can get enough.

One recruiter said "We only needed 50 to 60 workers this time last year. But we have hired 100 people this year, and we still need 200 more. "

According to data from Zhuhai's human resource center, labor demand in the city for July and August increased 100 percent over the same period last year. However, the firms got only 20 percent migrant workers they needed.

Chen Xianfeng, Department Director of Zhuhai Human Resources Center said "All of our space has been used and still more is needed."

In Nanjing, east China, migrant workers are also hard to find. They have started to be more picky about which jobs they take.

One migrant worker said "I want to have a better job with a higher salary and free accommodation."

One migrant worker said "I want a job with less hours and a factory that is easy to get to."

Analysts say the new situation in the labor market is a result of more orders for manufacturers. In addition, some migrant workers find it easier and more comfortable to work locally. They are now able to find jobs in their hometowns with salaries they can accept. And so, some manufacturers are starting to transfer some of their production from coastal areas to inland locations.

Investment banks are moving to increase headcount in China and India in anticipation of rising deal flows fuelled by strong growth rates in Asia's largest developing economies.

Banks had scaled back staffing across Asia amid a dearth of merger and acquisition activity, and stagnant capital markets.

But investment banks and headhunters report renewed interest in recruiting for senior positions as confidence mounts of inc-reasing demand for services in main regional markets.

The Chinese economy is expected to grow by about 8 per cent in 2009, while India said this week its economy grew 6.1 per cent in the June quarter from a year earlier.

The strengthening econ-omic backdrop has prompted a flurry of capital raisings to help fund expansion plans. Bankers in Shanghai and Hong Kong predict a further $30bn of equity issuance this year.

According to Dealogic, corporate equity and debt issuance in India has confounded expectations, topping $26.6bn - more than in the same period last year.

Vikram Malhotra, Credit Suisse co-head of Asia investment banking, said that the bank had moved to boost headcount in such areas as financial institutions and energy. "As the momentum in the markets has continued, we have increased capacity to meet increasing demand from clients and investors, adding more execution strength as deal flow builds," he said.

Among the bank's recent hires are Simon Yuan, who quit Merrill Lynch to co-head its greater China financial institutions coverage. Goldman Sachs is expected soon to announce senior hires in Mumbai and Beijing.

Gokul Laroia, co-head of investment banking for Morgan Stanley in Asia, said the bank had made selective senior hires on the back of rising deal activity.

Other banks have moved to reallocate senior staff from other regions to Asia, given the relative opportunities, while some are reassigning executives to new positions in China as they seek to expand their mainland platform. JPMorgan recently moved Frank Gong, chief China economist, to an investment banking role.

Another feature is the move to create senior positions in Hong Kong, to oversee China and India from banks' regional headquarters.

Morgan Stanley last month hired Ronan McCullough from Goldman Sachs to head its bond and loan syndicate for Asia Pacific.

Google Inc. announced that Kai-Fu Lee, president of Google Inc.'s China operations, is resigning from the company after working for years to establish the Internet giant as a formidable player in the country.

Mr. Lee will be succeeded by two Google executives, the company said. Boon-Lock Yeo, currently director of Google's Shanghai engineering office, will run engineering for Google China. John Liu, who currently leads Google's sales team in greater China, will assume Mr. Lee's business and operational responsibilities.

Mr. Lee left Microsoft Corp. to join Google in 2005 to develop the company's operations in China, where Google was later than some of its rivals to establish a beachhead.

Mr. Lee's hiring kicked off a legal battle between Microsoft and Google. Microsoft, alleging Mr. Lee violated his employment contract, filed suit against Google. Google countersued, accusing Microsoft of "a shocking display of hubris," according to court documents. The companies settled privately in 2005.

Google said Mr. Lee is leaving to work on his own venture. "With a very strong leadership team in place, it seemed a very good moment for me to move to the next chapter in my career," Mr. Lee said in a statement.

During Mr. Lee's tenure, usage of Google products, including its search service, has grown among Chinese users. The company has also launched some products unique to the market, including an online music service. In announcing Mr. Lee's departure, Google said it was nearly doubling the size of its sales force in China in response to strong growth.

But Google continues to confront a range of headaches in China, which, as the country with the largest number of Internet users, is critical to its growth. Google still trails Chinese search leader Baidu by a wide margin. In the second quarter of 2009, Google drew around 20% of Chinese Internet searches, compared with Baidu's 76%, according to iResearch, an Internet research concern

Google has also continued to clash with Chinese authorities, who have selectively blocked services such as its video-sharing site, YouTube.

More Chinese graduates prefer to work for a State-owned company than for a foreign-owned enterprise, according to a new survey.

The findings were based on surveys of 21,000 graduating college students across China by the human resources company www.chinahr.com.

It is the first time in seven years that Chinese companies came out on top.

Foreign companies received a historically low vote of 23 percent, compared with 34.1 percent for State-owned businesses in the poll.

"Advantages such as more stable employment and better employee benefits at State-owned companies proved to be more attractive to college students, especially given the global economic slowdown," said Ouyang Hui, a human resources (HR) research supervisor at www.chinahr.com.

"Foreign companies, joint ventures and private enterprises cut back staff or scaled down recruiting plans last year, while State-owned businesses endeavored to create job opportunities for graduates in accordance with official policy," Ouyang said.

Chen Jiang, a master's degree graduate of Peking University, the most prestigious in China, moved to a State-owned integrated circuit company this summer after originally being hired by a foreign company in the same line of business.

To his surprise, Chen said, a lot of his classmates who worked for well-known foreign companies asked him to keep an eye out for any opportunities for them.

US-based Procter & Gamble and Google are the only two foreign companies in the top 10, according to the poll.

China Mobile ranked first for the second time, while past favorites Microsoft and IBM ranked 11th and 12th, respectively.

Ouyang said the State-owned companies started to attract more recruits in 2007.

According to researchers, students were attracted most by fair human resources policies and opportunities for development and advancement when choosing a job.

Salary and benefits were the top factors in 2008. This year benefits ranked fourth, and salary ranked ninth.

"It is a good phenomenon if the investigations were conducted scientifically," said Mike Wang, HR manager of Morgan Stanley China.

"It means students could have more choices when selecting a job. But to us, it's less relevant," Wang said.

"As a leading foreign company in the field, we always pay attention to college students and try to provide them with the best career path. And we respect individual choices according to their own situations," he said.

To learn more about graduates' needs and preferences during campus recruitment periods, Morgan Stanley conducted its own survey in the first half of 2009 among students at Tsinghua, Peking, Fudan and Shanghai Jiaotong universities.

"We broadened our recruitment outreach based on the results, such as expanding our information channels through campus bulletin boards and other popular online forums posting job-hunting information, so that graduates would have a clear picture of what we can offer them," Wang said.

"To further contribute to the community and also enhance communications between graduates and Morgan Stanley, we have been sponsoring the Morgan Stanley Scholarship Program at leading universities in China since 2006," he added.

Yi Siting, 25, a master's graduate from Renmin University of China, chose Bank of China as her career starting point this spring, but denied the economic situation was her main consideration while job hunting.

"At State companies such as Bank of China, a lot of relaxation activities will be organized, which makes employees feel like part of a family. Large companies give me a sense of belonging and security," she said

Yi's close friend Tang Fang, from Peking University, said she prefers foreign companies to any other kind, saying they had more management expertise and a freer atmosphere.

But Yi disagreed.

"Actually, most State companies such as Bank of China always hire a lot of people from abroad, and it has a very open and modern management style," Yi said.

"Nowadays, the gap between State-owned companies and foreign ones in this respect has become narrower and narrower," she said.

As HR commissioner at a State-owned telecommunication company, Wu Yao was pleased with the poll results.

But he added that he didn't expect State-owned companies to prevail in the long term.

"As the distance between Chinese companies and foreign counterparts narrows, students will choose employers according to their own background, personal working style and interests, regardless of whether it is foreign or State-owned," Wu said.

"All companies have realized the importance of human resources," Wu added.