Competition for Talent Rising in China’s High-Tech Industry


By Cassie M. Chew November 5, 2010

China leads the world in spending on research and development, trademark registrations and patent applications, according to the 2010 report by the World Intellectual Property Organization.

These developments, as well as China’s announcement in 2010 of a 10-year national talent development plan and the desire among Chinese high-tech companies to increase their clout in the global marketplace, are some indications of the bigger role China will eventually play in the information technology industry, experts say.

Wanted: Managers

Furthermore, HR should be mindful of these changes and the need for more people with leadership skills in order to help companies find and develop talent.

“Beijing is getting to be known as China’s ‘Silicon Valley,’ ” said Christine Liu McLaughlin, a shareholder in the Employment Law Practice Group of Godfrey & Kahn, based in Milwaukee, Wis.

Changes in China’s labor law and its transition to a market economy have created a climate among technology firms in Beijing and China’s coastal regions that now matches the entrepreneurial spirit that has made the San Francisco Bay area in Northern California home to some of the world’s largest technology companies, said Yu Zhou, author of The Inside Story of China’s High Tech Industry (Rowman & Littlefield Publishers, Inc., 2007).

“There is a hunger for technology, and tech companies are trying to satisfy that hunger,” Zhou added. “It was never as intense as [America’s] Silicon Valley because of the infrastructure. Now there is an industry that could match that energy and devotion and hunger.”

The competition for talent has become so great that the cabinet agency that runs China's largest state companies announced in August 2010 a global talent search to fill management positions at a dozen major state-owned companies.

In addition, the Chinese government plans to make hires that raise the profile of dozens of other state-run companies in several fields, including the high-tech industry, experts say.

Calling HR

While there are plenty of engineers and mathematicians in China, “there is a shortage in leadership people,” Zhou said. “In order to work internationally, they need people who understand international business, legal practices and culture, and these are difficult areas for the Chinese companies.”

The problem exists, Zhou said, because Chinese companies traditionally don’t have well-developed human resource programs because of China’s planned system of lifetime employment, in which a person is expected to work for one employer over a long period of time.

Human resources among Chinese firms has been “very chaotic and opportunistic, but in the last three to five years they have developed more of a system because they have learned from the multinational companies, and competition for talent makes it more important,” Zhou said.

HR has discovered that tapping into those Chinese natives who have moved abroad and luring them home is a good strategy to net talent.

“Steps to keep talent at home and encouraging high-tech experts to return to China and start their careers is one of the most important aspects of the country's plan of reinvigorating the strength of the nation,” wrote Lin Jun, chairman of the All-China Federation of Returned Overseas Chinese, in an essay published in People’s Daily, the official newspaper of the Communist Party of China.

In a 2010 paper written with colleague Jinn-Yuh Hsu, Zhou wrote that “since the late 1990s, Chinese professionals returning to the mainland have emerged as the most innovative industrial and capital agents in the technological industry” and that professional returnees are critical to reshaping high-tech global production and service in Asia.

As a consultant for public and private companies that do business in China and former director of employee relations for a global staffing firm, McLaughlin advises clients seeking talent to consider regulatory and cultural issues in order to be successful in their recruitment and talent development efforts.

McLaughlin said that changes in China’s labor law in 2008 established a baseline set of benefits that should help recruiters for multinational companies compete for talent. Human resource professionals recruiting for positions in China need to understand their company’s long-term globalization plans.

Recruiters need to pay attention to the culture and the needs of the talent pool whose employment options in China are limitless.

“It’s not just money,” McLaughlin said. “It’s opportunity; it’s title; it’s prestige; it’s respect ... it’s being able to have a career in China and the ability to grow.”

Cassie M. Chew is a Washington, D.C.-based freelance multimedia journalist.


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