By Andy Curlewis, Senior Vice President – Product Management; Mony Yip, Brand & Digital Consultant
Companies with the right talent are more likely to take their business to the next level – but winning top candidates can be challenging. Competition for candidates in China is fierce: recruiting the best employees is now a strategic business initiative and a critical driver of corporate performance. Research shows that highly engaged teams generate 23% greater profitability.
Market difficulties only intensify the competition. Due to COVID-19-related restrictions, some western expats left China, leading more multinational companies (MNCs) to look for candidates locally. But young and talented job seekers are increasingly more interested in regional companies (i.e., internet, finance, media), especially tech organizations. To attract candidates, these businesses offer generous salaries, stock options, strong compensation packages, and fulfilling work. Many MNCs find it difficult to lure employees away from such attractive benefits – but regional companies are facing increased competition.
Source: Zhihu/DT Finance
To win talent and achieve superior business growth in China, tailoring a successful recruitment strategy is key. Here are the top three talent market trends to keep in mind as you formulate your company’s hiring process:
1. Emerging competitive talent market
As a global economic powerhouse in recent years, the Chinese government has committed to substantially growing the country’s middle-class group. It’s estimated to increase by 80 million people by 2030, implying rising wealth, better education and greater social mobility.
This profound demographic shift is expanding China’s talent pool. The number of people with higher education increased by 50% – to over 12 million – in 2021. By 2030, China will generate approximately 2.5 million graduates per year (37%) with STEM degrees across Organization for Economic Cooperation and Development and G20 countries, exceeding India (27%) or the United States (4%).
Source: 2023 China’s Future Consumer Report, Boston Consulting Group (BCG)
2. Differentiating your company from competitors
Early-career seekers value experience at reputable companies for their future career development. This remains one of the top priorities in 2023, according to Universum’s latest “Most Attractive Employers in China” report. Candidates conduct extensive research on companies before applying or accepting a job offer. Fulfilment and the opportunity to truly be oneself are considerations when talent chooses a job – 91% of employees weigh these as important as income.
A strong brand reputation is crucial to attracting job seekers in such a competitive market. With more qualified candidates available, building a resilient employer brand – and considering employer brand consulting – better positions organizations against fast-growing private Chinese and state-backed companies.
Source: The Most Attractive Employers in China, Students 2023: Universum report
Source: Hopes and fears 2022: Mainland China report, PwC
3. Retention is a top priority
With the dynamic talent market, the turnover rate is high in China – making it a challenge for companies to retain employees. Research shows that employees stay with one employer for an average of 22 months. More options in the job market means employees are more likely to switch jobs easily.
Some of the best retention strategies include improving workplace design, tailoring reward policies, focusing on employee well-being, and devoting resources to developing employees.
Winning top candidates in a competitive regional market isn’t easy. But with awareness of the local demographic and current talent trends, you can design solutions that’ll give your company a strong hiring advantage.
Read on for tips on how to build a strong employer brand in China.