Hiring and Retention in China

By Frank Mulligan - Recruit China

An old friend of mine in Korn Ferry, not that either of us is particularly old, recently completed an insightful report on recruitment and retention within the life science market in China. This broadly covers pharmaceuticals, medical equipment and biotechnology.

The title of the report is ëOvercoming the Challenges of Recruiting and Retaining Talent in Chinaís Life Sciences Marketí, and the authors are Cheryl Buxton, Li Ling and Helen Tantau. They seem to combine local knowledge of China with industry knowledge of life sciences. (Odd that a group of headhunters would not be open to receiving Inmails on LinkedIn. But letís stop picking.)

The money quote is in the first paragraph:

ëthe single largest brake on the growth of the life sciences sector in China is the struggle to attract, and even more importantly, retain an executive workforce that possesses the right skill setsí

Without belaboring the point, this is the case in every industry and market in China. A senior Public Relations(PR) executive in China just scared me with stories about local Managers getting offers of triple their current salary and the title of Director. All just for changing job ie. no increase in scope or responsibility.

Another company executive reported annual staff loss rates of up to 80%, to my face, and with a straight face. The story was not meant to be a jaw dropper. It was just resigned, hands in the air acceptance. íItís just what we are facing in China every day!í.

But this is not a school boy competition about who can tell the best, or scariest, hiring story. The life science hiring and retention narrative that Korn Ferry spells out in detail gives you good insight into how the life sciences, and other industries, are coping with the War for Talent in China.

If you donít have time to read the report, here is a summary:

The War for Talent in China continues in the life science industry.

In North America and Europe the market appears flat for life sciences companies. The

growth rate of most MNCs in China is, by any standard, phenomenal, and this is on the back of massive government support and investment.

The biggest shortage is in local Chinese nationals, as opposed to expatriate foreigners.

The shortage of local talent has created opportunities for expatriates.

Recruitment of all kinds of professionals is very difficult in life sciences, but the problems will continue, with high rates of turnover the norm. Rates of 30-40% are common for sales and manufacturing.

Local HR Managers find it difficult to explain this turnover to company headquarters where the common belief is that people in China are just queuing up for jobs. (A lot of us here are tittering at this pointÖ..)

Multinational companies tend to seek ísuperstarsí, while local State-Owned Chinese companies tend to look for generalists who can fit in. These local companies tend to experience much lower turnover. Top players looks for salary increases of up to 100% just to change jobs.

Returnees, those PRC citizens who have returned from work overseas, offer a solution but there is a lot of risk, with only one in three succeeding in the role.

Moving candidates between cities in China is as difficult as moving someone between cities in Europe, such as Paris to London. Shanghai is top choice for candidates, and moving professionals from Shanghai to other cities is fraught with risk.

Organisational development is beginning to take root in China but we are at a very early stage.

The ideal culture is one that is team-based, transparent, open and less hierarchical, where values and ethics are rewarded.

So hiring is the current challenge. Retention is next, and organisational development the long term challenge that we may never get to. Those still struggling with hiring are going to find it very difficult to get to long-term profitability in China.

(If you want to know more, or request a copy of the report, please email me at the address below.)

Email frank.mulligan@recruit-china.com
Frank Mulliganís blog - english.talent-software.com