Expatriates in China - Talent Demand Shift

July 13, 2015 3 mins read
Expatriates in China - Talent Demand Shift

Having worked for, with, and even being an expat myself in China for the past four and half years, I would like to share some personal and professional observations and thoughts regarding the current status of expatriate talent here.

As one of the largest economic contributing countries globally, China is undoubtedly the central hub for most foreign companies including global F500 MNCs across all industries.  Most companies have set up their Asia headquarters in China (mainly in Shanghai, Beijing and Guangzhou); many of which have gradually set up their APAC and even Global Headquarters here during the last decade.  

With this increasing demand in quantity and quality of experienced talent in different functions, many companies have internally rotated, transferred or even promoted their employees from other regions or even global HQ to set up or lead the team in China; most of these talents hold the position of country heads, GMs, function heads, business partner for functions, project leaders, etc.  Talented professionals who are more mobile and aggressive are interested in seeking out opportunities in a growing industry or some who are simply home-sick after being overseas for long time.  

Thanks to the support of these expat professionals working closely with the local talent, companies are able to fast-track business and functions.  With the more mature and structured set-up of Chinese HQ carried out quickly and corporate cost control, there has been a noticeable drop in demand for expatriate experts especially those in middle to senior management levels.  Many expatriates have already been harmonized with local-plus package structures instead of full expat packages to have a longer service term in China. Strong Chinese talent has outgrown expectations on performances, technical and communication skills as well as being able to communicate and influence local partners or stakeholders to achieve results.  Hence we have noticed the trend of companies in hiring local talents and not as open to expatriates from overseas.  

Since this switch in demand has happened in a short period of time, many executive talents from overseas including Chinese professionals with overseas education and working experience are finding it hard to cope with the declining interests from corporations in their profiles.  

My suggestions to these talents whom are very dedicated to coming or returning to China have often been to gain more Chinese or Asian project experiences first and apply for internal transfer or unfortunately having to adjust expectations in terms of salary, benefits, as well as the position and scope.  Often they will only have no package increment (depending on profiles and experiences), but could even see a slight package decrease as corporations simply aren’t ready to bear the extra relocation, housing, taxes, and potentially children’s education costs in the beginning before seeing the cost-benefit ratio.

China is indeed a very exciting and growing platform with plenty of growth in the near future especially for those executive professionals that are looking to expand their experience or portfolio; however, I would strongly recommend to take into consideration of this shift in demand and the expectations from both sides before making the move or applying for jobs.

Alan Li's picture
Operations Director, Greater China
ali@morganmckinley.com