Recruiting in China

By Benjamin Robertson

Chinese graduates are facing their first employment crunch in 30 years, but employers aren’t rejoicing. Despite the apparent abundance of labor, there is a paradox: Companies often have trouble finding the right candidate for the job.

Another job fair, another riot.

Such is the demand for college graduate jobs in China these days. Pictures from a recruitment fair in the central Chinese city of Zhengzhou showed smashed doors, broken glass and an escalator with sides bent outward at an extraordinary angle. Thirty-thousand eager students surged into the exhibition center in mid-November, overwhelming police, security guards and one hapless escalator as they rushed to be the first to sign up with potential employers.

It was an image that revealed the desperation of Chinese college graduates facing an employment crunch for the first time since market reforms began in the late 1970s. As more people enter universities than ever before, government figures indicate that 20 percent to 50 percent of this year’s 4.13 million graduates will not find jobs. It’s a situation that shows little sign of abating in the years ahead. A December report from the government-affiliated Chinese Academy of Social Sciences says that next year there will be 25 million urban job seekers chasing 10 million jobs.

"It is now very difficult to find work. There is a strong supply and demand imbalance in the college graduate market," says Liu Hao, CEO of Zhaopin, one of China’s leading recruitment portals. Its services include online recruiting, newspaper recruiting, headhunting and campus recruiting. "Whereas the U.S. job market is cyclical, China has not seen a recession in 20 years."

A generation of college graduates has never seen large-scale layoffs, says Liu, echoing the concerns of senior government leaders, who have worried about potential effects on social stability and have held crisis meetings regarding the issue.

Zhaopin’s Web site is registering an average of 70,000 new job seekers every week. Yet despite the apparent abundance of labor, there is a paradox: Liu says companies often have trouble finding the right candidate for the job. Though China is famed for a large, mobile, hardworking workforce, the 37-year-old CEO suggests the country’s education system is not always producing the right sort of talent.

Many multinationals would agree with him. Despite the record number of graduates, sourcing talent is now the leading concern for American companies in China ahead of intellectual property rights protection, according to an annual members’ survey of the American Chamber of Commerce.

"Employers are looking for someone with practical work experience, leadership ability and creative problem-solving skills," explains Jim Leininger, general manager of Watson Wyatt in Beijing. "The education system is very good at developing quantitative ability but falls short in developing some of the key skills employers are looking for: creative thinking, group problem solving and the ability to apply knowledge to real-life situations."

At the Beijing offices of Microsoft, human resources director Danielle Monaghan concurs. Microsoft often advertises through Zhaopin and has no shortage of applicants. The company often receives 16,000 to 17,000 applications for just 300 places. Monaghan says the company still needs to invest time and money into certain forms of training that would be unnecessary back in the U.S.

"We do have to develop their skills to work in a multinational," she says. "Generally graduates are without strong team-working skills. They don’t take a lot of initiative. They don’t push back or say no, and we have to teach these skills because that is key to survival at Microsoft."

While China is by no means the only country facing a talent shortage, its blistering growth over the past decade makes any shortfall all the more acute. In a 2005 report titled "China’s Looming Talent Shortage," consulting firm McKinsey & Co. predicted the country’s economy would have difficulty moving up the value-added ladder from manufacturing to services if the quality of graduates were not addressed.

Like recruitment portals in the West, Zhaopin provides an online interface for posting job advertisements and résumés. It allows Liu to see exactly where the shortfalls are. High-tech industries like auto and drug manufacturing are especially short of quality candidates, he says.

A step above graduate-level job seekers, midlevel managers in the marketing and finance sectors are also in high demand, Liu says. Zhaopin’s goal is help employers fill these gaps in their hiring process. Using part of a recent capital investment from Australian firm Seek, Zhaopin hopes to upgrade its search algorithms to provide better matches and value for employers and would-be employees alike.

"In the past you [would] put out an ad and get a hundred résumés and you would be happy. But now we realize that only a small percentage would be qualified," Liu says.

Another solution to the lack of graduate talent is company training. But while larger multinationals have well-established training programs, smaller foreign companies and their Chinese counterparts are just beginning to invest in the sort of team bonding and leadership exercises that are common practice in the West. In a survey of 558 multinationals in Mainland China, Watson Wyatt found that the average annual cost of training per employee is only $200.

Though puny, the investment reflects a change in corporate thinking, Liu says.

"The standard HR managers in this market were guys who pay salaries and hire and fire people. Now, more and more companies claim they realize human capital is the most important form of capital," he says.

Spotting an opportunity for expansion, Zhaopin has begun company training programs. Clients so far include a municipal government tax bureau and various state power companies.

But a limited length of job tenure can offset such investment. Because talent is in short supply, employee poaching is rife within industries.

"In the U.S., the average length of time someone stays in a job is five to six years. In this market it is two years," Liu says. Figures from Watson Wyatt say annual employee turnover at multinationals is 14.3 percent, and because employers are desperate to find and retain talent, annual salary increases now average 7.8 percent, noticeably higher than the 1 percent to 2 percent rate of inflation.

Despite their exposure to the dynamics of the human resource market, Zhaopin has not been immune from high turnover. At one point, its sales team was posting 25 percent annual turnover, a frighteningly high proportion that Liu says has since been brought under control.

The key is breaking up office hierarchies by allowing new sales members to chase existing but inactive accounts. Previously, client accounts were the domain of the original contract winner, regardless of whether any recent sales had been made.

One emerging trend among multinational companies is to relocate inland, away from the wealthier and more expensive eastern seaboard. Provincial capitals such as Chengdu, Chongqing, and Nanjing are already booming centers of industry and commerce and should in theory offer large pools of untapped talent.

Liu, whose company also is expanding to cover the country’s provincial capitals, is less sanguine. He says the top talent has migrated to the big cities of Beijing, Shanghai and Guangzhou.

March 8 is International Women's Day and officials from the All China Federation of Trade Unions, led by Sun Chunlan, secretary general of ACFTU's Secretarial Department, have visited female employees and female migrant workers to give their support.

The entourage visited Beijing Postal Administration Jianguomen Branch, Beijing Topnew Knitting Group Company and the subsidiary of Beijing Ba Fang Da Bus Company in Tongzhou district. ACFTU officials checked the working and living conditions of the women workers in those factories and units, expressed their thanks to them and congratulated them doing good work.

Sun Chunlan said women workers are the backbone of China's industry and they have made great contributions to elevate their positions in society. She also said that the government's work report delivered by Premier Wen Jiabao at the National People's Congress shows the care the CPC Central Committee and the State Council have taken in realizing the political status, democratic rights and economic benefits for women in China.

Sun expressed her expectations for all the workers, especially women workers, to further strengthen their sense of responsibility, continue studying and work hard to make greater achievements and contribute to the realization of China's objective to build a rich society in all ways.

There are 19 staff at the letter sorting center of Beijing Postal Administration Jianguomen Branch, all of whom are female workers. Beijing Topnew Knitting Group has more than 800 migrant workers, and most of them are female. Nearly half of the 12000 migrant workers in Ba Fang Da Bus Company are women.

Following a decision agreed upon in 1910 at a Socialist International meeting in Copenhagen, International Women's Day was honored for the first time in Austria, Denmark, Germany and Switzerland on March 19, 1911. More than one million women and men attended IWD rallies campaigning for women's rights to work, vote, be trained, to hold public office and end discrimination. In 1977, the United Nations invited all member states to formally designate March 15 as International Women's Day.

UNIFEM, UNAIDS and Johnson & Johnson are together providing grants to organizations in five countries to address links between gender-based violence and the spread of HIV/AIDS.

The grants will be provided by Johnson & Johnson through the UN Trust Fund to End Violence against Women, a multilateral funding mechanism administered by UNIFEM. The Trust Fund became operational 10 years ago and has so far awarded some US$13 million to 226 initiatives in more than 100 countries.

The five new grantees include organizations from Botswana, the Dominican Republic, India, Nigeria and Vietnam. Each will pursue innovative strategies to raise awareness, uphold laws, provide medical assistance, train service providers and reduce stigma and discrimination to empower women.

In Vietnam, the Center for Reproductive and Family Health in partnership with Vietnam Women's Union will receive the funds. Money will be used for improved care and counseling services and public outreach focusing on sexual health and rights will reach women and girls from ethnic minorities along the Vietnam-China border, with a focus on those who have been trafficked into forced prostitution.

"Violence against women and HIV are pandemics that deny women's human rights and devastate individual lives and societies," said UNIFEM Executive Director Noeleen Heyzer. "We welcome the opportunity to work through public-private partnerships to invest in innovative strategies. Scaled up, they can become part of national development strategies to achieve lasting change."

The grants mark the second year of a partnership between UNIFEM and Johnson & Johnson dedicated to reducing gender-based violence and the spread of HIV/AIDS. The partnership supports initiatives aimed at reducing gender-based violence to lower rates of HIV/AIDS among women and strengthens efforts to reduce violence that prevents HIV-positive women and girls from seeking justice and obtaining treatment and care.

The partnership was facilitated through the UNAIDS-led Global Coalition on Women and AIDS, of which UNIFEM is a member. The coalition has identified ending violence against women as a priority for lowering women's vulnerability to HIV and improving their access to health care.

Globally, violence against women is both a cause and a consequence of HIV/AIDS: women facing violence within intimate relationships often cannot negotiate safer sex practices, such as condom use. Rape and harmful practices such as female genital mutilation also spread the virus. In addition to untenable levels of stigma and discrimination from the community, women who test positive for HIV are often subjected to physical abuse from partners and can face eviction from their homes. Further, as a result of such stigma associated with HIV/AIDS, they are prevented from obtaining life-saving medical care and treatment.

SHANGHAI will create 500,000 new jobs this year for laid-off workers, unemployed youth and those living in the suburbs, city officials announced yesterday.

The government said it plans to keep the registered unemployment rate below 4.5 percent this year, and will provide internship opportunities to 30,000 jobless youngsters.

Last year, 663,000 jobs were created across the city, surpassing the government's target by 163,000 positions.

"Although we fulfilled our goal last year, we should notice that unemployment among young people is becoming an increasingly prominent issue in the city," said Sheng Zuhuan, a spokesperson for the Shanghai Labor and Social Security Bureau.

More than 143,000 students will graduate from colleges and universities in the city this year, an 11 percent increase from last year, which should add to pressure in the job market.

About 49,000 of those graduate come from vocational colleges, and they will likely face the most difficulty finding work, according to Shen Xiaoming, director of the Shanghai Education Commission.

"With the growing supply of university graduates, it does pose a greater challenge for the city to tackle the unemployment problem among young people," Shen said.

The city government plans to set up training programs for 5,000 college and university graduates this year, in order to equip them with stronger vocational skills.

Each of the trainees will undergo tailor-made training at local companies and enterprises during their studies.

THE Shanghai Personnel Bureau plans to attract another 20,000 overseas professionals to work and start their own business here over the next five years, bureau officials said at an international human resources conference yesterday.

Shanghai Municipality has formally launched its recruitment drive to find volunteers for the 2008 Olympic Games in Beijing.

Yu Biao, director of the Shanghai Youth Volunteer Department, says that the 2008 Beijing Olympic Games will recruit 800 volunteers in Shanghai, 700 of whom will work for the football matches held in Shanghai and the remaining 100 volunteers will go to Beijing to serve at the 2008 Beijing Olympic Games and the Paralympics Games.

Yu says that Shanghai citizens have become more and more fond of taking part in volunteer work. He says that for every ten people that ask to volunteer, only one person is chosen for these types of events.

Shanghai citizens can log onto the website of Shanghai Youth Volunteer to submit their application to be a volunteer. The search for qualified volunteers will last until March 2008.