Recruiting in China

For Yukimasa Uchida, managing director of the Japanese arm of the Boston Consulting Group, a recent recruiting trip to sift the best and the brightest among China's top graduates was a revelation.

"It was like striking a gold mine," Uchida said of the job fair.

His company had attended the event expecting to make job offers to two or three students, but only if it could find people of the right quality.

"We have already made job offers to six students in Beijing and Shanghai together," he said. "We may hire some more."

He was not alone among Japanese recruiters in being impressed by the quality of applicants at the event, held in Beijing and Shanghai between Nov. 3-6.

The fair, organized by Recruit Co., a leading job placement agency in Japan, drew about 10,000 students from 39 universities, including the elite Peking and Tsinghua universities in the capital and Fudan University in Shanghai. Of these students, only about 1,000 college seniors were selected for interviews by the prospective Japanese employers, after a vocational aptitude test and preliminary interviews.

For successful applicants, the potential rewards on offer were mouthwatering. Although Japanese businesses have been hiring in China for years, the 22 companies at the fair were hiring people to career-track positions in their Japanese headquarters, rather than jobs at China-based affiliate companies.

That usually means much higher pay and chances for promotion. The companies included major names such as Sumitomo Mitsui Banking Corp., Mizuho Financial Group Inc., Kirin Brewery Co. and Konica Minolta Holdings Inc.

Like Uchida, Noriya Fukumoto, personnel manager of the toymaker Tomy Co., was bowled over by the caliber of the students he encountered.

"They are brilliant," Fukumoto said. "They have a clear vision of their career path and have a strong drive, compared with Japanese students."

Tomy offered jobs to three applicants, one more than it had anticipated. It plans to recruit foreigners to half of its new positions for college graduates in future.

Boston Consulting Group had been hiring between 10 and 20 graduates a year from Japanese colleges, including graduates of the University of Tokyo, Keio University and other big-name schools.

"Most job applicants were inclined to value stability," Uchida said. "There were fewer combative candidates, like soldiers of fortune."

In China, its recruiters were finding ambitious and go-getting personalities, he said, "the type we greatly favor."

The company did not make Japanese language skills a requirement for the recruits at the interview, taking the view that they can learn Japanese after getting a job offer. They all spoke English competently, although most of them had never been abroad.

Junichi Ito, the organizer of the fair at Recruit's Shanghai unit, said the large number of top-quality applicants had been attracted because Japanese businesses were offering positions on the payrolls of their Japan-based operations.

"Japanese affiliates in China have found it hard to secure top-class personnel because their pay is lower than that of U.S. and European counterparts," Ito said. Another obstacle has been a perception that local hires cannot reach the top echelons of corporate hierarchies.

The companies at the fair paid 1 million yen ($12,000) each to take part and were required to pay 1.1 million yen for each new recruit. In return, they got access to the cream of the more than 6 million people who graduate from Chinese colleges each year.

A 22-year-old senior who majors in Japanese at Fudan University said getting on the payroll of a Japanese company's head office was key.

"While a monthly salary at a Japanese affiliate in China is about 3,000 yuan (about 37,000 yen), the starting salary in Japan is about 200,000 yen. There is no comparison," she said.

The promise of working overseas and of greater responsibilities at head office made the positions on offer at the fair very attractive, she said. "Many of my classmates are going to work in the United States and Britain," she said. "I want to work abroad, too."

Xu Shuang, 21, a Japanese major at Tongji University in Shanghai who is studying international economy at Fudan University on weekends, said he had been interviewed by a Japanese bank. The enthusiasm of the Japanese for hiring foreigners was evident, he said. "Japan's corporate culture will be changing."

The targeting of Chinese talent by Japanese businesses is not limited to the graduate market. China's state-run Shanghai Foreign Service Co. and the Japan-based companies A-commerce Inc. and Global Power Co. formed a tie-up in October to target mid-career Chinese personnel.

They plan to hold a presentation for about 50 Japanese companies in Shanghai by the end of the year and have 500 Japanese organizations signed up within three years. Their service will include introducing Chinese personnel in white-collar jobs at foreign-affiliated companies in China to Japanese companies' main offices in Japan.

Yoshikazu Akiba of A-commerce said Chinese workers, who used to prefer working for U.S. and European companies, were showing more caution since the collapse of Lehman Brothers in autumn 2008.

"A Japanese company that emphasizes job security is greatly appreciated," Akiba said.

Meanwhile, Japanese companies wanting to expand their operations in China are viewing Chinese personnel as critical to the success of their marketing strategies.

"Sales pitches by Japanese staff in China have their limits," an official with a major food company said. "We would like talented Chinese personnel to acquire our corporate culture while working at our main office and then to take the charge of developing new markets in China."

One alleged drawback of hiring Chinese graduates is their penchant for switching jobs, but Uchida at Boston Consulting Group said this was not an issue.

"Many Japanese elite graduates who are not very ambitious types quit in two or three years," he said. "Whether or not Chinese staff stay on depends on their employer."

With the ratio of Japanese college seniors securing job offers hitting a record low 57.6 percent this year, the once remote prospect of competing with foreigners for prized positions at Japanese head offices is now a reality. Fukumoto at Tomy put it baldly: "If we employ more Chinese, that means we have fewer slots for Japanese."

For Uchida, that might not be a bad thing: 'If (recruitment of more foreign personnel) wakes Japanese students and employees to global competition, it would be a success," he said.

(This article was written by Atsushi Okudera and Tokuhiko Saito.)