Retention Down Drastically in China

By Frank Mulligan, Talent Software

The War for Talent is ongoing and now there is are more and more data coming in to back up the notion that there are strong reasons to worry about the general trend.

According to research by Mercer, companies in China are struggling to retain their professional and support staff, and face either having to pay higher salaries or excessive recruitment costs. They did the survey in more than 100 organisations in China. The results show that 54% have experienced an increase in turnover for professional staff since last year, while 42% have reported higher turnover for support staff.

The really scary part of the survey comes later on.

Apparently, the average tenure for 25- to 35-year-olds has fallen from an average of three to five years in 2004 to just one to two years in 2005. This is very important because this is the age cohort that is most attractive to companies in China. Go below this age band and you donít get the experience you need. Go above it and you donít get the skills and thinking that you need.

Mercer notes that companies can only come up with money as the main method of retaining staff. As a result salaries are rising fast, with one companyís efforts in this area tending to result in a similar response from its competitors.

Hewitt recently cited money as the main motivating factor for candidates in China. Looks like the companies in China have followed.

Mercerís Top Five methods for attracting and retaining staff in China are given below.

Method - % of respondents

Attractive salary and benefits package - 23%
Opportunities for career development - 19%
Meaningful and creative work - 7%
Unique organisational culture - 7%
Company location - 3%

Comments to: frank.mulligan@recruit-china.com