Recruiting in China

In 1997 Mc Kinsey's coined the phrase "War for Talent", the following few years were characterised by critical shortages of talent fuelled by economic expansion, the emergence of the dot-com sector, recruitment and expansion in the Technology arena, growth in consulting fortunes and the rise of the service industry. As we entered the era of the "Generation Y" worker there was a shortage of key skills available. Recruitment agencies saw the boom coming, advised clients accordingly. Many client companies struggled to secure the talent required, wages spiralled. Exuberance in packages offered took the war out of reach of many firms. Companies were forced to compromise on talent, those who did not act were weakened and when the exuberance abated in 2001 they suffered further.

International executive recruiters Antal International are calling on all Line Managers & Human Resource professionals to make a diary note for January 2007. A decade on from its origination, Antal predict that 2007 will see the return of the War for Talent, however, there will be some significant differences, according to the results of a survey undertaken by EMEA, CEE & Asia specialists. This time it will be global, affecting all levels of employee and functions, a "Perfect Storm" in talent terms.

Tony Goodwin, Antal's Chairman & CEO stated, "The 1997 War was largely localised, contained within a few skill functions and didn't affect every business sector. Firms were either feeding grounds for the boom enterprises hiring in the late 90's or were trying to stay out front. This time, driven by a number of additional factors, the second war for talent will be truly global and more far-reaching."

A confidential survey Antal undertook of mid to senior executives in firms across diverse markets in Europe, Russia & China shows that 34% would consider a move in 2007 due to increased market confidence and greater awareness of their appreciating market value. When added to expected levels of staff turnover, competitor hiring and those addressing satisfaction issues, the result is expected to be a turnover storm of epic proportions. The Antal survey found that:

Up to 72% of employers forecast more than 12% new job growth in 2007. Alone, this job creation won't start the war, but combined with the other factors, it will exacerbate it.

Recently published data across EMEA & Asia shows that well over a quarter of employees are not fully satisfied and would actively seek a move as evidenced in employee feedback, increased workplace stress and work-life balance issues rising on the agenda.

Companies held the power in the "employer market" of the last five years and some paid less attention to employee motivation, retention, engagement and work-life balance than perhaps they should have.

Salaries stayed relatively flat in recent years and fewer promotion opportunities have been widely available. Many businesses have reported productivity gains against a backdrop of falling morale.

It is much easier today for employees to appraise themselves of their market value and review positions on job boards & corporate sites. Discrete job surfing remains a popular web pastime and can be done without contacting a recruitment consultant until one is ready to step into the "available" zone.

The rise of jobs-by-email functionality on job boards means they don't need to publicise their resume and jobs come to them direct, over 42% of executives regularly received job information by email from online recruitment sources.

Increasing numbers of senior managers have started to leave the workplace and as this generation ages further it will lead to critical shortages of experienced managers, creating an experience gap. Antal's survey found that over 25% of senior managers were considering retirement within five years.

Generation Y workers (born in the 70's to 90's) are increasingly likely to change jobs more often. They have grown up in a world of immediacy and fast change and view a change of employer as a positive way of increasing their worth, advancing careers more quickly. Many see a position lasting up to 2.5 years as sufficient. Average tenure in firms is dropping in the under 30 age ranges.

Picture this - It is early 2007, your own new headcount needs to be filled, as does that of your competitors, employee confidence in the market place grows, they're more comfortable looking externally for opportunity, "job security paralysis" becomes less of a factor and a large section move, some of your senior managers retire or seek more work life balance, your generation Y's begin their quest for the "next best thing" and move on, the best executives have moved early and are already locked-in to new firms, new entrants open in your market trying to attract your talent¡­ and what's more, this happens in all your locations.

With recent increased investment in boom markets like Russia, Eastern Europe, China and Latin America, Antal predict that companies wont just be fighting for talent in their domestic market, they will be engaged in a battle on all fronts. Employers will face the same issues of attraction, recruitment, retention, motivation and leadership development in every location they have expanded into around the globe.

Graeme Read, Antal's COO commented, "Over the last decade, firms have internationalised far more than ever before, sourcing and production has moved to different countries such as China or Eastern Europe, massive new B2B and consumer markets have opened in emerging markets like Latin America and China. All this leads companies to expand sales and operations internationally to tap this lucrative market opportunity and often the easiest route into a new market for others is to target experienced people at competitor firms, buying in valuable local knowledge and experience."

He added, "In 2007, the cost imperative of globalisation and the faster pace of opening operations internationally will further the boom in emerging markets. FDI, new office and manufacturing facility openings are set to grow exponentially in 2007, fuelling the storm in even remote locations."

Alongside the survey, Antal polled a selected number of clients in its key markets to see how they are preparing to head off the storm. Some areas highlighted by those taking action include:

• An increase in availability of remote access allowing staff to work remotely on selected days.

• More use of "golden handcuffs" to lock in top talent and more benchmarking of salaries to market.

• A sharper focus on the individual, identifying and nurturing "Rising Stars" in every corner of their global businesses.

• Greater use of recruitment technology and web sourcing and more use of diverse sourcing methodologies.

As salaries and packages start to rise and talent pools dry up, companies are turning to flexible workers and an increased use of contractors in IT, Accountancy, HR and Marketing is envisaged in many markets.

Firms focus more on the core aspects of the business, outsourcing non-core activities in areas like IT, Call Centres, Customer Service, Recruitment, Media Management.

Far more focus on retention, with increased line manager input and reworked retention plans.

Greater emphasis on the "sell" of the company and opportunity to potential employees at interview.

More HR time spent on areas like Talent Development, Leadership Development, and Compensation & Benefits with less focus on administrative tasks.

Early search activity - many firms are starting to look for talent now - acting before the market heats up, enabling the best.

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