Despite being one of the world´s largest and fasting growing markets, China faces a labor shortage of local qualified staff. This is especially true in Shanghai, where many foreign companies struggle to hire qualified local workers. To overcome this shortage, a number of foreign companies are revamping their recruiting processes and changing their benefits packages in hopes of attracting more local employees.
The number of foreign companies entering Shanghai is growing rapidly, with as many as 400 new foreign business registrations filed each month. In combination with this increase, many foreign firms are changing their start-up methods and hiring approaches, often using fewer expatriates to initially establish a company in China, and then hiring a larger number of local managers, returnees, or locally-paid expatriates to help run the company. These new hiring trends place a much higher demand on the need for local workers in China and also require foreign companies to find new ways to attract and retain these local managers, returnees, and locally-paid expatriates.
In addition, salary levels are slowly beginning to rise and may eventually level off between Chinese and foreign companies, forcing foreign companies to rely more heavily on benefits packages in order to attract potential new hires. One way foreign companies promote themselves and attract new hires is through sales and marketing with local universities. For instance, Philips conducts a campus survey each year to determine the foreign companies at which students are most interested in working. In addition, some foreign companies are helping with home loans, paying government insurance contributions, offering stock options, providing a company car, or offering MBA sponsorship. Career development and training programs are also becoming more common, providing on-the-job training, training seminars, and product and technology exhibitions. Many of these programs also place more focus on retention strategies through reward programs or by emphasizing company culture.
