Recruiting in China

EMPLOYEES in Shanghai multinational companies won substantial pay increases last year due to a growing professional demand.

But the city still has lower labor costs than other major centers in Asia, according to a definitive report on salaries.

The report, released by Nasdaq-listed headhunter Hudson Recruitment yesterday, covered the pre-tax payroll of a total of 309 positions in nine different sectors - such as manufacturing, banking and financial services, advertising and communications and human resources - in Shanghai, Hong Kong, Singapore and Japan.

Pay increases varied widely in the different industries.

Upward trend

For instance, employees in the manufacturing and industrial sectors saw their pay rise by about 20 percent compared with that of 2005.

The increases in the advertising and communications industries reached up to 30 percent to 40 percent on average, human resources analysts said.

"Across all positions, salaries in Shanghai are presenting an upward trend, driven by the limited supply of candidates," said Kellie Grimsley, managing consultant with Hudson's Shanghai office.

"Companies try to offer high pay to attract and retain the talent they need."

In the manufacturing sector, for instance, the most eye-catching positions last year went to supply-chain management professionals.

The report said that a supply-chain manager with 10 years' experience was paid 250,000 yuan (US$31,250) to 400,000 yuan per year in the city. It is one of the best-paid mid-level positions in the sector.

Lucy Xiong, an analyst specializing in the manufacturing industry, said that the pay was bulked up as an increasing number of companies began to conduct their international procurement business in China's mainland.

That gave rise to a large demand for local professionals with a broad international network.

For the advertising and communications sector, a senior account director in the city is paid 540,000 yuan to 660,000 yuan per year, compared with the HK$600,000 (US$76,799) to HK$900,000 for the same position in Hong Kong.

A local investment bank associate can earn 350,000 yuan per year, almost the same amount of that paid in Singapore. But it's only half of the level in Hong Kong, according to the report.

However, salary gaps are getting narrower for senior-level positions in different regions, such as corporate finance managing director and marketing director, analysts said.