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As the 2018 global economy looks to continue getting stronger thanks to our cyclical recovery, most signs point to faster growth across all regions. China in particular has become one of the world’s most important battlefields for global capital as mobile technology, artificial intelligence (AI), robotics and big data bolster our traditional industries.
As we begin the Year of the Dog, China‘s macro economy and talent market face some significant opportunities and challenges. Before the Lunar New Year, I visited Michael Page's offices in Shanghai, Beijing, Suzhou, Guangzhou and Shenzhen, speaking with our teams about the current local talent market. Overall, they have helped me identify three trends ahead to watch.
High-tech talent has always been a favourite for China's job market. As China digital transformation quickens and traditional industries become digitised, technology roles will see hot demand this year. This includes traditional tech talent roles like R&D, hardware and software roles, plus high-end roles in emerging high-tech industries, where talent is in short supply. This includes roles in unmanned, AI, cyber security, and big data.
Recent statistics[1] state that the talent gap in information and technology industry has reached 9.5 million in China, with predictions of inter-disciplinary and cross-industry talent shortages ahead.
Cyber security and AI will be among the hottest topics. The global crackdown on cybercrime, in respond to serious security breaches and network viruses has made network vulnerability a key challenge. Globally, the cost of cybercrime has already hit US$600 billion: China has also pledged to crack down[2] on issues such as telecom fraud, personal information infringement and online pyramid selling. As such, China’s estimated talent shortage in cyber security is 700,000.
Talent shortages in AI may be even worse. Globally, the job-ready talent supply in AI is estimated at around 300,000, with demand at several million. There is no quick fix for this: and high-tech talent in AI will remain in short supply for some while, as industries push to move industry experts from the laboratory to the business market.
As the global economy recovers this year, talent flows will accelerate and competition will be red-hot. And for those attracting and retaining talent, employers will face unavoidable challenges for their Human Resources (HR) leadership.
Traditional HR revolves around professionalism, stability, standardisation and efficiency. In the new market environment, HR leaders need to be also be deeply involved in the business as a partner, familiar with core company issues, and active in building first-class teams with proven professional abilities and industry knowledge. Fortunately in numerous companies now, this is becoming the case.
In the digital age, HR leaders can call on a broader array of tools to attract the best talent. Some companies use VR technology to recreate the office scene so candidates can get an immersive understanding of the enterprise culture; other use robots or gamified applications, to augment the hiring process.
As the post 1990s generation becomes a main force in our job market, salary increases alone are no longer attractive enough to retaining talent. Employers will win or lose the talent wars on whether they offer an open and inclusive corporate culture; more comprehensive talent development and training; and clear and attractive career path planning and articulation.
In recent years, multi-national companies (MNCs) have undergone a relative decline in China, in part due to the unstable global economy and the rise of China’s domestic enterprises. The result was that a number of China-based MNCs made large-scale lay-offs, or were acquired by domestic enterprises. For many in tech for instance, domestic internet companies such as BAT (Baidu, Alibaba, and Tencent) have replaced MNC rivals as a top-choice employer.
Whilst the rise of domestic companies will continue we are seeing signs of MNCS returning to the hiring table. As the world economy strengthens, especially in the US and Mainland Europe, MNCs in China could become more confident and increase hiring.
Signs looks positive. According the Institute of International Finance for Bank of China, foreign direct investment (FDI) should increase 3% in 2018. In January alone, 5,197 new foreign-invested enterprises were set up in China, the highest monthly growth since September 2015.
Reflecting the above trends, we believe companies wishing to develop their business on the Mainland should seize the opportunity to embrace China’s new revolution. As a job seeker too, many have a rich opportunity to ride on these trends.
Andy talked about top 3 learning points from experience working in Greater China.
[1] Ministry of Education of China
[2] Recently-published Government Work Report during China's "two sessions”
