China has been one of the fastest developing economies in the past decade, but developments bring new challenges and obstacles along with it. One such challenge, which is becoming increasingly important for the Chinese Market to meet, is addressing the shortage of available leadership talent in the recruitment market.
Indeed, state owned enterprises as well as multinational and local companies are having an increasingly difficult time finding individuals with the right set of leadership and managerial skills to add to their teams. One of the reasons for this is thought to be China’s educational system which prevents the development of critical skills by “relying to heavily on memorization”(Newswise, 2012). Another cause exacerbating the shortage of talented candidates within the Chinese market is the high level of economic development taking place within the country throughout the past decade. This quick growth in the economy has prompted many companies to develop or expand to China within a short span of time, in turn exponentially increasing the demand for talent.
When it comes to company needs two main issues seem to be at the heart of the matter, finding and hiring experienced managers and retaining valuable employees within the company. Senior managers that have a good amount of experience under their belt are becoming increasingly rare to find whilst “commanding a high salary”(Newswise,2012). A study conducted by McKinsey had concluded that one of the biggest obstacles facing companies throughout China is that of recruiting capable managers (McKinsey). In order to solve this problem, “local companies are matching or exceeding MNC salary packages, offering enticing benefits and attractive career paths to senior management” a subject we will be delving into in our next article regarding the importance of Employer Branding (Forbes,2012).
When seeking and keeping the best talent, there are issues to, as Judith Bannister, director of global demographics at The Conference Group notes, “for multinationals, it is now a challenge not only to recruit the best people, but also to develop and retain them”(Bannister, 2012). As the rarity of talented and pragmatically skilled individuals increases so does their leverage when it comes to negotiating with and imposing conditions on their potential employers. “Keeping them after they get them is another problem. Wage increases alone are no longer enough. Companies are trying everything to win the hearts and minds of their increasingly mobile and independent-minded workers” (Sirkin, 2013).
The opportunities for managerial candidates interested in working in China are extremely advantageous, especially for those possessing strong leadership and creative skills. These advantages stem mainly from the quick development of the Chinese economy and heavy foreign investment which has left a gap in the market due to the increased demand for skilled managers. The difficulty for employers in China to find skilled managers has lead them to pay extra attention to the incentives and motivations candidates value the most when working for companies and to heavily invest in their Employer Branding. For this reason, we will next be exploring the subject of Employer Branding and its key role in attracting and retaining high value candidates. Stay Tuned!