Recruiting in China

The Ministry of Education has launched a recruitment campaign as it seeks high-end talent to fill the top positions of three domestic universities.

From Dec 4 to 23, interested candidates can check the official website of the ministry at www.moe.edu.cn and apply for the positions of president at one of three universities - the University of Science and Technology Beijing, Beijing University of Chinese Medicine, and China Pharmaceutical University, in Nanjing, Jiangsu province.

This is the second time the Ministry of Education has publicly recruited top leaders for its affiliated universities.

The previous round, which began in December 2011, included openings for two university presidents and six university chief accountants, and had multiple layers of screening that ended in March.

In this round of recruitment, the ministry adapted requirements for candidates that focused on two things: the candidates must have rich experience in management of high-level universities and possess administrative skills, and they have to guarantee their complete immersion in university management once they are selected.

Currently, China has 76 universities affiliated with the Ministry of Education. Presidents and deans in these universities have administrative rankings corresponding to official levels in the ministry. And almost all university presidents were designated by the ministry or by the Organization Department of the Communist Party of China Central Committee.

"The new requirement means that once they are selected as university presidents, they have to quit their own scientific research, and dedicate themselves to university affairs full time," said Xiong Bingqi, deputy director of the 21st Century Education Research Institute.

"The new requirements reflect the ministry's purpose in recruiting the university presidents publicly - the ministry officials want our universities to have professional presidents who are impervious to the influence of administrative power," he said.

The power of bureaucrats in China's universities has been widely criticized since 2007, when Zhang Ming, a professor of Renmin University of China, showed on the Internet how deans abuse their administrative power to influence academic research.

In the following years, many universities in China have tried various attempts to break administrative power. One of the most famous cases is that of Zhu Qingshi, principal of the South University of Science and Technology, who tried to start a university from scratch so that the university could stand independently, apart from bureaucracy.

Zhang Zongyi, who was selected president of the Southwestern University of Finance and Economics, said the ministry's public selection was tough.

"When I applied for the president position, I did not expect it to be so difficult. I actually thought it would just be some interviews," Zhang said in an interview with the Beijing News on Tuesday.

When Zhang gave his campaign speech, he found that students, professors and staff and even retired university staff and alumni of the Southwestern University of Finance and Economics were sitting in the hall listening to his speech.

"To ensure fair competition, all the candidates handed out our cell phones in the interviews," he was quoted in a report by the newspaper.

However, Xiong Bingqi, the education expert, said the effect of the public selection is "rather limited".

"First, although any candidates who meet the requirement can participate in the public selection, the expert committee who decide the result are from the ministry rather than any independent college councils," he said.

"Second, the selection included public opinion evaluation on the candidates, but the ministry did not disclose the results to the public.

"To make some real progress on reducing the administrative power in universities, the ministry will still have to improve the public selection."

BEIJING, Nov. 12 (Xinhua) -- China's job market is feeling the pressure from the country's economic downshift, as new job growth slows and more people become unemployed, a senior employment official said Monday.

"The impact of economic slowdown on the job market is starting to emerge," said Vice Minister of Human Resources and Social Security Yang Zhiming at a press conference on the sidelines of the 18th National Congress of the Communist Party of China, which opened on Nov. 8.

The growth of newly added jobs in cities has been narrowing since April, while job vacancies have dropped with higher registered unemployed number, Yang said.

"China will continue to face the problem of labor oversupply for a long time," he told reporters.

China's job market is under great pressure this year as nearly 7 million college graduates have entered the job market, while migrant workers and unemployed urbanites still have difficulty getting full employment, said Yang.

China's urban registered unemployment rate stood at 4.1 percent at the end of September, unchanged from the second quarter of 2012, according to official figures. It was lower than the officially set ceiling of 4.6 percent this year.

The country created 10.24 million new jobs in urban areas in the first nine months, exceeding the annual target of 9 million for this year.

Yang said the government will boost labor-intensive industries as well as strategic emerging industries to bring job growth along with economic development.

He said the government will encourage college students to work in the central-western regions or start their own businesses, facilitate the development of small- and medium-sized enterprises and offer better training for rural workers.

SAN JOSE — The question often comes up in job interviews, says Huawei executive John Roese, who has been recruiting scores of Silicon Valley engineers and programmers to help the Chinese tech giant take on Cisco Systems and other Western rivals.

The answer, Roese says, is: "No, we don't have any relationship with the Chinese government."

But the affable head of Huawei's North American research arm says he is used to confronting the subject. In recent years, concerns about Huawei's ownership scuttled its bid for a major telecommunications contract and forced the company to back away from two acquisitions after U.S. officials objected to the deals.

Huawei is one of China's biggest multinationals, with sizable financial and engineering resources, including 18 research centers around the world. But it's counting heavily on Silicon Valley talent to develop new hardware and software for telecom networks and corporate computer systems.

In the past year, Huawei has more than doubled the staff at its Santa Clara research center, growing to 430 with 200 more hires planned in 2011.

"Santa Clara is going to be a key to our future success," said Bill Plummer, a spokesman at Huawei's North American business headquarters in Plano, Texas.

But Huawei needs to overcome concerns raised by U.S. officials and members of Congress, who have charged that the company's efforts to acquire technology or sell communications gear to U.S. carriers could pose a threat to national security.

Huawei officials deny the allegations and have launched a campaign to reassure the United States.

Earlier this year, the company published an unusual open letter, inviting the U.S. government to investigate its background. In April, for the first time, Huawei published the names and photos of its corporate directors in its annual report — a standard practice for Western corporations.

"If we don't tell you who's running the company, then we're not being transparent. So we're now being very aggressive about that," said Roese. "We're starting a bit late. We were kind of an enigma to some."

Three years ago, Huawei was forced to withdraw a bid to invest in 3Com, the networking company later acquired by Hewlett-Packard, after U.S. officials raised concerns the deal would allow Chinese access to 3Com's technology. Earlier this year, Huawei said it backed away from a deal to buy the assets of 3Leaf Systems, a Silicon Valley cloud computing firm, after an interagency federal panel again raised objections.

A spokeswoman for the government's Committee on Foreign Investment in the United States, which has members from such agencies as Defense, Treasury and Homeland Security, said the panel's proceedings are confidential.

But two U.S. senators, Democrat Jim Webb of Virginia and Republican Jon Kyl of Arizona, warned in a public letter that the 3Leaf deal "could pose a serious risk" to the United States, in part because of Huawei's "well-established ties" to the Chinese People's Liberation Army.

Concerns have focused on Huawei founder and CEO Ren Zhengfei's 10 years as an army official, in a country where the military often has influence over state-run industries, and on reports that Huawei has received financial support from the Chinese government.

Huawei, which says Ren started the company four years after retiring from the army in 1983, insists the government has no ownership or role in the operation. Huawei officials have blamed competitors for stirring up protectionist sentiment.

"We recognize that because Huawei has a heritage in China and the fact that the U.S. and Chinese governments have at times had a tense relationship, we are unfortunately viewed through the prism of that relationship," Plummer said.

The company lost out on a major contract to supply gear for Sprint last year after objections were raised in Washington, according to The Wall Street Journal.

But Huawei is vying for other U.S. deals and has contracts with major telecom carriers in Europe and Canada, which have "rigorously audited" Huawei's technology, Plummer said.

At its Santa Clara campus, meanwhile, Huawei is working to develop new networking technology, as well as software to manage complex IT systems and new ways to integrate computing, networking and data storage.

Huawei is the world's second-largest supplier of networking gear for telecommunications carriers, according to the Gartner research firm. Now it wants to sell a broad range of technology to other businesses, putting it squarely in competition with Cisco, Hewlett-Packard and others.

It also wants to build systems that carriers can use to offer cloud computing services to their customers. And it's entered the consumer market with a line of smartphones and a new 7-inch Android tablet announced last month.

"We're not an established player" in those markets, Roese acknowledged. But he said that's been a selling point to recent hires, including former engineers at Sun Microsystems, Cisco and other Silicon Valley companies.

Roese describes Huawei as "a very aggressive, 100,000-person startup," with all the resources but far less bureaucracy than other tech giants. "It's a really interesting technology company," he tells job candidates, "that happens to have started in another part of the world."

SHANGHAI - With the growth of the national economy and the continuous development of Chinese enterprises, more middle- and high-level professionals in China now prefer to work for domestic companies rather than foreign-owned enterprises, human resources experts said.

"Multinational companies have long been in a favorable position in the recruiting market due to their liberal reward and advanced management culture," said Chen Jiewei, senior consulting manager with China International Intellectech Corporation (CIIC), a Shanghai-based HR services company.

"But over the past five years, Chinese companies have been doing excellently and many of them have been listed abroad. They have demonstrated their competitive strength," Chen told China Daily, "Now they can offer salaries and bonus plans that are competitive with foreign companies, which makes them increasingly attractive for high-level management professionals."

A report from CIIC said that the annual salary for management positions in Chinese enterprises is basically equal to that in Japanese enterprises, about 200,000 yuan ($30,880) a year (before tax), while for European and US enterprises it is about 250,000 yuan a year. For director positions, European and US enterprises generally provide an annual salary of more than 400,000 yuan, while Chinese enterprises offer more than 300,000 yuan and Japanese enterprises about 300,000 yuan .

For senior management positions, the annual salary in a European or US enterprise is about 800,000 yuan, while large Chinese enterprises offer about 600,000 yuan and Japanese enterprises about 500,000 yuan.

But Chen said that it is not only the salaries that are driving high-level talent toward Chinese companies. It is also a better personal career path.

"Multinational companies have developed for a long time in China, and practiced a localization strategy, but even so, a lot of senior management positions are still dominated by foreigners. High-level Chinese staff often find it's hard to break through the bottleneck and advance," Chen explained. "They have no scope for their particular talents."

"Some large Chinese companies, on the other hand, can provide sufficient room for people's career development," Chen added.

"Chinese enterprises have developed very fast and improved effectively over the past years in terms of the management level, working environment, compensation packages, as well as the promotion system. They have competitive advantages over their foreign counterparts in recruiting staff," said a 33- year-old man, surnamed Wang, who declined to give his full name.

Wang currently works as a department manager in a US technology company but he hopes he can move to a Chinese company, especially a State-owned company.

"State-owned enterprises have improved their market performance and have comprehensive competitiveness. That means there may be more opportunities for self-development," Wang said.

State-owned enterprises overtook foreign and private enterprises as the top destination for job-seeking graduates in 2010, according to a survey of 200,000 students conducted by ChinaHR.com. Eight of the top 10 companies named in the survey are State-owned.

Chinese companies are more popular among students born between 1980 and 1990, majoring in science and engineering, according to a survey by Aon Hewitt, a global human capital consulting company.

Aon Hewitt polled graduates over the past two years and found that China Mobile, Alibaba and Haier have overtaken Google and P&G to become the most popular employers among graduates.

BEIJING, June 9 (Xinhua) -- More Chinese college graduates are finding jobs, with the employment rate back to the pre-crisis level and a significant rise in salaries, a latest survey shows.

The employment rate of college graduates has risen over the last two years to 89.6 percent in 2010, about 2 percentage points higher than that in 2007, according to a survey by education research company MyCOS Institute released Thursday.

Some 227,000 college graduates were interviewed for the survey six months after they graduated last year.

In breakdown, 91.2 percent of the university graduates and 88.1 percent of the graduates from junior colleges and higher vocational schools found jobs within six months of graduation, according to the survey.

Meanwhile, college graduates' average monthly starting salary was 2,479 yuan (381.4 U.S.dollars) in 2010, 349 yuan higher than the starting salary of those who graduated in 2009, MyCOS said, attributing the rise to rising demand for skilled workers.

The survey also covered some 109,500 employees who graduated from college in 2007. Their average monthly income had reached 4,388 yuan, more than double what they earned three years ago when first interviewed by MyCOS.

China's eastern and costal regions were still the most attractive places to work for college graduates, with Beijing, Shanghai and Guangzhou as the most appealing cities, according to the survey.

But among those who graduated in 2007, more than 20 percent of them had left the three cities within three years of graduation, it said.

About 60 percent of the interviewees who graduated last year thought their jobs did not match their expectations.

Some 36 percent of these graduates regarded their positions as "inconsistent" with their career plan, while 22 percent of them said the work failed to match their interests.

Jobs not matching career plans was a salient reason why 34 percent of these graduates left their positions within six months of graduation, said MyCOS.

More graduates are starting their own businesses after graduation, with 1.5 percent of graduates becoming self-employed in 2010. Most of the graduates' start-up funding came from parents, relatives, friends and personal savings, according to the survey.

51job, Inc. (JOBS) Q1 2011 Earnings Call May 5, 2011 9:00 pm ET

Operator

Good morning and good evening ladies and gentlemen thank you for holding. Welcome to the 51job, Incorporated first quarter 2011 conference call. At this time, all participants are in a listen-only mode. After the presentation there will be an opportunity to ask questions (Operator Instructions). I will now hand the conference over to Ms. Linda Chien, Assistant Vice President of Investor Relations. Thank you, Madam. Please go ahead.

Linda Chien

Thank you all for attending this teleconference to discuss un-audited financial results for the first quarter ended March 31, 2011. With me for today?s call are Rick Yan, Chief Executive Officer and Kathleen Chien, Chief Operating Officer and Acting Chief Financial Officer. A press release containing first quarter 2011 results was issued earlier today and a copy may be obtained through our website at ir.51job.com.

Before we begin, I would like to remind you that during this call, statements regarding targets for the second quarter of 2011, future business and operating results constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 as amended and as defined in the Private Securities Litigation Reform Act of 1995.

These statements are based upon management?s current expectation and actual results could differ materially. Among the factors that could cause actual results to differ are the number of recruitment advertisements placed, sales orders received and customer contracts executed during the remaining weeks of the second quarter of 2011, any accounting adjustments that may occur during the quarterly close; fluctuations in the value of the Renminbi against the U.S. dollar and other currency; behavioral and operational changes of customers in meeting their human resource needs as they respond to evolving social, economic and political changes in China as well as stock market volatilities; introduction by competitors of new or enhanced products or services; price competition in the market for the various human resource services that the company provides in China; acceptance of new products and services developed or introduced by the company outside of the human resources industry and fluctuations in general economic conditions.

For additional information on these and other factors that may affect the company?s financial results, please refer to the risk factor section of the company?s filings with the Securities and Exchange Commission. 51job undertakes no obligation to update targets prior to announcing final results for the second quarter of 2011 or as a result of new information, future events or otherwise.

Now I?ll turn the call over to Rick.

Rick Yan

Thank you, Linda. And welcome to today?s call. I will begin with highlights of the first quarter, followed by Kathleen with her detailed review of our financial results. I will then discuss current market conditions and recent developments. Finally, we?ll open the call to your questions.

Results for the first quarter came in ahead of guidance as the positive economic climate and robust hiring activity in China throughout demand for our services. We reported total revenues of RMB 325 million or approximately $50 million, an increase of 28% over the first quarter of 2010. We saw solid revenue growth in each business area. The momentum of our online services business remained strong with online revenues increasing 57% year over year.

We have employers across all geographies utilizing our established sales office network to further penetrate existing markets and our Wuhan call center to serve employers in new cities. This two pronged approach has enabled us to acquire new customers more effectively and efficiently than ever. Our print advertising business also performed well in the first quarter. Although, we have discontinued publications in six cities since the beginning of 2010 through the first quarter of 2011; print revenues were better than expected and decreased by 6% due to the exceptionally strong seasonal demand in the post Chinese New Year period.

In our other HR services business we make steady progress in continuing to gain customer attraction. Revenues for the other HR services increased 25% led by growth in outsourcing and training services. While we are very pleased with our top line the greater accomplishment of the first quarter was the meaningful margin expansion that resulted from the revenue of the performance. The record margin efforts highlight the powerful economies of scale and scope we have built into our service model.

Through unrelenting operational discipline and a consistent focus on efficiency improvement which drove gross margin to 70% and operating margin to 35% despite absorbing higher employee compensation expenses and investing in product development and technology innovation. Since our inception 13 years ago we have not wavered from our guiding management principle to realize sustainable profitable growth for our shareholders. We believe this first quarter financial results reflect our continued progress towards this goal.

I would now turn over the call to Kathleen for more detailed financial review.

Kathleen Chien

Thank you, Rick. Revenues for the first quarter totaled RMB325 million, a 28% increase compared to the same quarter in 2010. Our online revenues for the first quarter were RMB173 million, an increase of 57% compared to the same quarter in 2010. The number of unique employers using our online services increased 38% year over year to nearly 155,000 companies in the first quarter due to the strong market demand and our customer acquisition efforts. We also saw a 14% increase in the average revenue per online customer compared to the year ago quarter as employers faced greater competition for talent and thus purchase more services to meet their recruitment targets.

Print advertising revenues decreased 6% to RMB86 million compared with RMB92 million in the first quarter of 2010. The decline was primarily due to the discontinuation of print operations in certain cities over the past year as well as the resulting decrease in page volume. Print advertising pages in the first quarter of 2011 decreased 28% to approximately 2200 pages compared with about 3100 pages in the prior year?s quarter. However, the page volume decrease was largely offset by the higher revenue per page assisted by the strong seasonal demand or average revenue per page increased 31% due to greater contribution from the higher priced cities as well as an increase in print advertising rates in a few cities in the first quarter of 2011.

In line with the historical trends we expect print revenues in the second quarter to decline in both absolute terms and as a percentage of total revenues. We have also terminated the publication in the city of Kunming in April. This reduces the number of cities in which we operate print operations to 15. Our HR services revenues grew 25% to RMB65 million in the first quarter of 2011. We achieved solid growth in our outsourcing and training businesses due to the greater customer acceptance and demand.

Gross profit increased 39% year over year to RMB215 million and gross margin increased to 70% from 64% in the first quarter of 2010. The margin expansion was primarily due to the process improvements and our operating efficiency. Included in cost of services in the first quarter was share based compensation expense of RMB1 million, though the marketing expenses increased approximately 26% year over year to RMB71 million in the first quarter of 2011 mainly as a result of higher employee wages, commissions and bonuses. Included in sales and marketing expenses were share based compensation expenses of approximately RMB0.8 million in the first quarter.

For the second quarter we will be stepping up advertising and brand building activities but we expect sales and marketing expenses to be within the historical range of 25% to 30% of net revenues. G&A expenses for the first quarter were RMB37 million down slightly from the year ago quarter. Share based compensation expense included in G&A in the first quarter was RMB4.3 million, operating income for the first quarter of 2011 increased 77% to RMB 107 million compared with RMB61 million in the same quarter in 2010.

Our operating margin expanded to 35% compared with 25% in the first quarter of 2010. Net income for the first quarter increased 82% to RMB92 million compared with RMB50 million in the same quarter of 2010. Fully diluted earnings were RMB1.55 per common share which is equivalent to $0.47 per ADS. Excluding share based compensation expense, foreign currency translation loss and their related tax impacts our non-GAAP adjusted net income increased 78% year over year to RMB101 million in the first quarter. Non-GAAP adjusted fully diluted earnings per common share were RMB1.71 or $0.52 per ADS.

In late April, we issued stock options to employees and directors at their market value. As a result we expect that share based compensation expense will increase from RMB6 million in the first quarter to approximately RMB10 million in the second quarter. Looking at our balance sheet, our cash and short-term investments increased to RMB1.7 billion or approximately $265 million. Short-term investment consists of certificate of deposit with original maturities from three months to one year. Now I will turn the call back over to Rick.

Rick Yan

Thank you, Chien. Our observations of hiring trends and employer behavior that?s just slightly in 2011 continue to indicate robust market demand. We saw a strong uptick in job listings across the board in a post Chinese New Year period, picking at more than 2 million active job positions. The competition for managerial talent and experienced workers in particular has also become increasingly fierce among employers driving wages increased and greater spending on recruitment services. Amid a backdrop of these favorable market conditions we roll out a new rate card online services which went into effect on April 1. In addition to the introduction of new services and packages we instituted a number of price adjustments which very widely depending on product and city.

As existing customers already under contract will not be subject to these new prices until renewal, the impact of the new rate card would be limited in the second quarter. The length of our online services contracts typically ranges from one month to one year. Therefore, we expect to gradually realize mid-to-high single digit increase in average revenue per customer from the new pricelist through 2011.

While we are taking opportunity to capture some pricing upside we are staying aggressively in our customer acquisition and geographical expansion efforts. In late April, we launched seven new channels to our website adding 13 cities serviced by our Wuhan call center. We now provide dedicated sales coverage and support for our online products to employers in 56 cities. We will further increase our national footprint this year.

Recently, there have been media reports regarding new and potential entrance into the online recruitment space in China. However, to-date the competitive landscape feels generally unchanged to us as we maintain and establish a widely acknowledged market leadership position, to reach knowledge and relationships we have into hundreds of thousands of HR departments is unparalleled. We have leveraged these assets into becoming a trusted partner to corporations across all the human resources needs, not just providing them with an advertising platform.

We know how to compete, we know how to execute and we know how to monetize. With ample financial resources backed by strong balance sheet in our highly experienced call management team, we are confident that we can continue to win. Now turning to our guidance, based on current market and operating conditions, our total revenue target for the second quarter of 2011 is in estimated range of RMB325million to RMB335 million which will be a 26% year-over-year increase at the midpoint. Our estimated non-GAAP fully diluted EPS target is between RMB1.6 to RMB1.7 per common share.

Please note that, if non-GAAP EPS range does not include share based compensation expense, foreign currency translation loss know their related tax impact. As Kathleen mentioned earlier, our share based compensation expense is expected to increase to approximately RMB10 million in the second quarter. This guidance reflects our current forecast which is subject to change. In addition, seasonality in our businesses, we remind you that sequential quarterly comparisons can be misleading, and we believe year-over-year comparisons are more applicable for measuring our financial performance.

Our priorities going forward are crystal clear. We are focused on growing our customer base, increasing revenue opportunities, investing in new product development and delivering solid returns to our shareholders. We believe the stock we have had in 2011 provide further confirmation that we are executing the right strategic plan to develop the most powerful brand in human resources services in China.

That concludes our presentation, we will be happy to take your questions at this stage. Operator?