Recruiting in China

In a move to further encourage companies to hire more young people, the State Council has asked every city in China - except four - to drop the permanent residency requirement when hiring non-native college graduates.

In a recent document, the State Council has asked cities, except for Beijing, Shanghai, Tianjin and Chongqing, to lift hukou, or the residency permit restriction so that applicants can move almost anywhere for a job.

The document comes after a job stimulus package was unveiled in early January intended to help college students find jobs amid the economic slowdown.

"The Chinese job market is grim amid the global financial crisis and college graduates are facing huge pressure finding jobs," it said.

College graduates are a "valuable" human resource, and all local governments and all related departments should give top priority to the employment of college graduates with more innovative measures."

The document also says that labor-intensive small enterprises can receive up to 2 million yuan ($300,000) in loans if they employ a certain number of registered jobless urban residents.

The major State-owned enterprises and scientific research institutions were also urged to offer more jobs for graduates.

The State Council also encouraged college students to broaden their job search and consider working in grassroots communities, central and western parts of China or SMEs, or start their own business.

The self-employed graduates can get individual small loans of up to 50,000 yuan.

An earlier report by the Chinese Academy of Social Sciences said the unemployment rate among new graduates surpassed 12 percent at the end of 2008, and that 1.5 million were without work.

According to the Ministry of Human Resources and Social Security, 6.1 million fresh college graduates will enter the job market this year.

"The employment of college students should come first in the whole employment stimulus package," Zheng Gongcheng, the country's leading social security scholar and senior lawmaker, told China Daily.

He said college students and their families have invested lots of money in education with high expectations for a future career.

"If many college graduates cannot find proper jobs, it is a huge waste of social resources," Zheng said.

But most fresh job seekers want stimulus policies to be more concrete.

"I am not clear about the measures and I don't think they have much to do with me," Xu Baoxin, 22, a new graduate of Southeast University in Nanjing, Jiangsu province, said yesterday.

"They are too vague and the lifting of hukou restrictions may only be helpful for those who want to work in big cities," Xu said.

Another job seeker, Tang Jianye, said the stimulus policies are a little bit late and they need more employment related services.

"It (the policy) is late but it's better than nothing," the graduate from Jiangxi University of Finance and Economics said.

In another step to help graduates find jobs, Beijing municipal government plans to hire college graduates as community assistants, a new position created by the local government, in a bid to encourage them to work at grassroots level.

China will launch a graduate trainee program for one million unemployed college graduates in three years, according to a circular issued by the general office of the State Council on Sunday.

The program did not suggest a fixed length or pay scale of the training, but the circular demanded local governments and organizations which provided training to offer basic living subsidies to the trainees.

The government would build training bases for the program with responsible employers, and employers are encouraged to recruit graduate trainees, said the circular.

Besides the trainee program, the government would also enhance technical training for graduates from vocational schools with a "double certificates" program.

According to the program, schools would help the students get vocational qualification certificates when they leave school, in addition to their graduate certificates.

China had about 1.5 million unemployed college graduates by the end of 2008, registering an unemployment rate of 12 percent, the Chinese Academy of Social Sciences said in the Blue Book of China's Economy (2009) last December.

BEIJING (Xinhua) -- McDonald's China announced on Wednesday an expansion plan to set up 175 new outlets and create more than 10,000 jobs this year on the Chinese Mainland despite global economic downturn.

The expansion was the largest of its kind ever made by McDonald's across the world.

"The move will bring more opportunities for cooperation to food-related industries in China," said McDonald's China CEO Jeffrey Schwartz.

The US-based food chain store group has 50 suppliers in China, with more than 95 percent of its food materials coming from local market.

On the same day, the group announced its decision to launch a 16.5 yuan (about $2.4) discount meal in its Chinese outlets.

"The price is even lower than that of a similar product in this market a decade ago," said Schwartz.

He added the company's management of material supply and its increasing presence in China helped cost control and made the big discount possible.

McDonald's has opened more than 1,050 outlets in China in the past two decades.

Telecom giant Ericsson (ERICb.ST) may hire a few hundred more people in China this year, as it plans to shift some overseas operations to the country, a company source said on Tuesday.

Local media had earlier reported that the Swedish firm would axe 150 jobs, or 5 percent of its total workforce in China, as part of its previously announced global cutback of 5,000 employees, in an effort to curb cost.

But a source who works in the company's human resources department said the firm was likely to hire, instead of firing, people in China this year.

"The technology unit would hire a few hundred staff this year and more people are needed in telecom service unit," said the source who requested anonymity because of the lack of authorisation to speak to media.

A company spokeswoman in Beijing declined to comment on the hiring plan, but described the local media reports as a "rumour".

Ericsson and its Chinese partners won about 26 percent of China Unicom's (0762.HK) 3G network construction orders last month, totalling up to $2.3 billion, according to previous media reports.

Chinese firms are continuing to hire managerial staff despite the economic slump, with media professionals and accounts in most demand, an international poll has found.

Recruitment has remained relatively strong in China, with 43 percent of businesses taking on managerial personnel, according to a quarterly survey by Antal International this month.

The figure is expected to fall to 20 percent next quarter but the number of companies letting staff go will also drop, keeping the market stable, the survey said. "The global financial situation has certainly had an effect on the jobs market here, but conditions are still relatively strong," said Robert Parkinson, who runs Antal's operations in China.

"Hiring activity is down from the last quarter but at the same time so is the number of companies firing managerial staff," he said. "It suggests organizations are still looking for new talent but with caution, waiting to see what happens in the coming months."

The media, particularly for those with IT and Internet technical knowledge, is a strong employment area, with hiring expected to rise to 60 percent in the next quarter and firms laying staff off set to drop by 7 percent.

"The demand for IT and Internet media professionals reflects a demand in distant communication through technical assistance, a result of companies cutting traveling budgets during the economic slowdown," Parkinson said.

Hiring rates for accountancy firms plunged from 96 percent last quarter to 57 per cent, but sackings will fall from 27 percent to 7 percent next quarter, the survey said.

Automotive companies are expected to fire more people, with a predicted rise from 13 percent to 20 next quarter, while hiring dropped from 86 percent last quarter to 37 and is expected to fall again to 23 percent next quarter.

In banking "hiring has seen a rebound", says Parkinson. The economic crisis highlighted the importance of managing personal wealth, resulting in a lift in private banking and risk management services, he said.

(China Daily February 9, 2009)

By: Patricia Van Arnum

Large pharmaceutical companies rank China as the best location for outsourcing in Asia, followed by India, Korea and Taiwan, respectively, according to a recent PricewaterhouseCoopers index. The index evaluates Asian countries according to cost, risk, and market opportunity for the pharmaceutical industry. The report suggests outsourcing to Asia is moving up the value chain, as low-cost production is eclipsed by a broad range of factors, including market potential and research and development (R&D) capacity as the drivers of growth.

"Within five to ten years, we will be moving from 'made in China' to 'discovered in China,'" said one pharmaceutical industry executive interviewed for the report. "Pharmaceutical companies need to make sure they are refining their strategies to make the most of the opportunities presented in Asian countries," said Michael Keech, director of the global pharmaceutical and life-sciences industry group at PricewaterhouseCoopers. "China and India will continue to spearhead growth in the Asian pharmaceutical sector, but, alongside those countries, Singapore will maintain its position as a center for research and innovation. While the trio of India, China, and Singapore are proving to be the 'hotspots' of the Asian pharmaceutical sector, other countries, notably Korea and Taiwan, are also going to be increasingly significant. The companies that will be most successful at making pharma outsourcing and location decisions will be those that are most adept at managing and mixing a range of contractual relationships and partnerships across a number of different locations."

According to the report, pharmaceutical companies in the United States and other developed countries are facing challenges that are constraining revenue growth and have a resulting need to look for new ways to boost drug-discovery potential, reduce time to market, and minimize costs. For example, only nine of the 18 new treatments launched in the US in 2006 came from the laboratories of the 13 companies that comprise Big Pharma.

The report highlights three significant developments that are shaping Asian pharmaceutical outsourcing:
•The trend toward high-end innovation. Intellectual property (IP) concerns have previously inhibited this trend in the pharmaceutical industry, but increasingly such concerns are being overcome and major moves are being made by large pharmaceutical companies to increase their drug-discovery investment in Asia.

• Rapid expansion of clinical trials in Asia. The volume of clinical trials being conducted in countries outside of Europe, North America, and Japan has been growing rapidly in recent years with Asian countries leading much of the growth. China has overtaken India as one of the fastest-growing locations. By June 2008, China had 428 clinical trials underway and registered on the website Clinicaltrials.gov and a cumulative total of 870 completed or ongoing trials compared with 737 clinical trials in India. Cost has been a critical factor in this expansion. For example, clinical trials are estimated to be up to 50% cheaper in India compared with the US.

• A scaling up of pharmaceutical manufacturing in Asia. An increased commitment to international standards, Asian contract manufacturing organizations (CMOs) are securing more outsourcing orders from large pharmaceutical companies. In India, for example, there are more than 100 US Food and Drug Administration-approved pharmaceutical facilities, the largest number in any country outside the US, according to the report.

The report shows that China and India, followed by Korea and Taiwan, provide several benefits for the pharmaceutical industry, including a pool of educated and qualified scientists, IP law reform, and market growth. These trends are outweighing factors that had previously inhibited development, principally uncertain regulatory frameworks and enforcement.

Although significant risks remain, there is growing convergence with international regulatory standards. However, the report's authors point out that such convergence is also being felt in labor markets, with the result that traditionally wide wage differentials, compared with developed-country locations, are narrowing. Such convergence will continue to shrink the cost gap, prompted in part by the need for Asian countries to compete for high-end skills in an international labor market. India, for example, is already finding it difficult to recruit in certain areas such as clinical research personnel.