Recruiting in China

This is an extended abstract of an article that appeared in this week's edition of The Economic Observer, for more highlights from the EO print edition, click here.

By the end of 2013, numerous provinces and cities across China will have launched pilot programs implementing fixed-term contracts in the hiring of civil servants. By the end of 2014, the contract system may be implemented nationwide.

Shenzhen was the first city to launch the contract system, doing so in 2007. Shenzhen was followed by Shanghai in 2008, and Jiangxi, Henan, Fujian, Liaoning, and Guangxi provinces in 2012. Jiangsu, Sichuan, Shanxi and Shandong provinces are expected to launch contract systems by the end of 2013.

When Shenzhen initially implemented the contract system it hired 41 civil servants. Now, Shenzhen hires all new civil servants through the contract system. Currently there are 3,000 civil servants under the contract system in Shenzhen, with another 500 to be added later this year.

The new contract system allows for more flexibility in the process of hiring officials. Applicants can be recruited directly and might be able to avoid the extended series of exams and interviews that others hoping to land a public service job are forced to go through.

The new system also differs from existing hiring practices in relation to how the salary package for such civil servants are determined. Traditionally, renumeration for most civil service positions are centrally determined according to their level. Under these new fixed-term contracts, employees enter into a wage agreement with the department hiring them and thus have more room to negotiate. The final salary of public servants that have been recruited according to the new contract system are determined by the contract they sign with the department.

Zhu Lijia (???), a professor at the Public Management Teaching and Research Department and director of the Public Administration Department at the China National School of Administration, says that the lack of regulations covering the direct recruitment of civil servants and the process of negotiating a salary package means that the system is open to abuse.

The new contract system is mainly used for recruiting highly-skilled professionals.

Liang Yuping (???), director of the Civil Servant Management Department at the Chinese Academy of Personnel Science, and Peng Jianfeng (???), a professor at the School of Labor and Personnel at Renmin University of China, believe that the contract system helps to both motivate and supervise civil servants.

However, Li Jianzhong (???), a researcher at the Chinese Academy of Personnel Science, told the EO that preventing people becoming civil servants through direct recruitment and preventing local governments from providing unreasonably high wages to civil servants, is the best way to guard against corruption.

Last year over 1.5 million people registered to take the national civil service exam. They were competing for approximately 20,800 positions.

Liu Xin, a professor at the Institute of Organization and Human Resources at Renmin University, recently explained to Time Magazine why so many Chinese graduates are attracted to a career in the country's civil service. "As a civil servant in China, unless you quit or make a big mistake, you have a job for life," he said. "It's the iron rice bowl. That's especially important during an economic downturn."

The roll out of these new fixed-term contracts along with mounting job pressures, may begin to alter this perception.