Training talent

Cosmopolitan Shanghai can be both a city of hope and despair for those seeking a career in the financial industry.

Every year before summer, tens of thousands of fresh graduates swarm the metropolis hoping to find a job in the city's many banks, stock brokerage firms, insurance companies and other financial institutions.

But, only a small percentage of them have the right qualifications needed to score a valuable one-on-one interview with an employer.

It's this shortage of qualified and experienced workers that's been a major stumbling block in the development of Shanghai's service industry.

The thirst for talent has spawned a fast-growing industry: human resource training in the financial sector.

Chinese training industry revenues reached 20 billion yuan in 2004 with an average 30 percent annual growth rate. That's according to a report on the Chinese training market by China Investment Consulting Net (CICN). The figures also showed industry revenues likely exceeded 43 billion yuan in 2007.

Shanghai perhaps boasts the largest market for personnel training in China with roughly 3,500 registered centers.

Many qualified workers are needed to fill spots in the rapidly expanding financial sector, particularly within the personal wealth management business.

It's estimated as many as 200,000 Certified Financial Planners (CFPs) are needed in Shanghai and other major east China cities, says Zhao Liang, secretary general of the Chinese Institute of Certified Financial Planners Ltd.

This year alone, the number of people with $1 million in personal assets is expected to surpass 1.6 million. Both domestic and international financial institutions are eager to win the market share.

That's why a CFP certificate offers those looking to join the financial planning industry a fighting chance, says Xue Zhenliang, executive director of the Shanghai CFP Center (SCFP).

About 4,200 to 4,300 people attended CFP and its lower level AFP (Associate Financial Planner) examinations in 2007. That number was nearly double the figure from the previous year, says Wang Qiling, a market specialist from SCFP.

The fast-growing market for CFP training in Shanghai is owed in part to the city's status as a financial center.

"Shanghai people have stronger awareness of planning their individual assets compared with other domestic cities and regions," Xue says.

A CFP training course costs almost 16,000 yuan and takes 22 days to complete. About 95 percent of domestic banks, along with some international banks, including HSBC, have sent their employees to attend.

"About 100 people from China Construction Bank take our training course yearly," Xue says.

Most CFP students have at least a college diploma and range between the ages of 25 and 45, says Yang Xiaofang, marketing director of SCFP.

There are currently about 5,000 CFPs nation-wide. Eastern China occupies a third of that figure. Yang adds people with CFP certificates are more likely to obtain better placements in financial institutions.

After receiving his certificate, one manager of financial planning at a foreign bank saw his salary jump by 30 percent, from 140 thousand yuan to 200 thousand yuan.

The abundance of financial institutions and strong demand for talent also makes Shanghai the leading training market for a Charted Financial Analyst (CFA).

"In 2007 fiscal year, we have trained 2,500 to 3,000 people in our Shanghai, Beijing, Guangzhou, and Shenzhen center," says Yu Run, training director for CFA program from Shanghai-based Daomingcheng Education and Finance Training Center.

"And, Shanghai accounts for 50 percent," he says.

Analysts estimate 20,000 CFAs are currently in demand. Right now, there are only about 600 in Shanghai. They account for nearly 55 percent or 1,100th of the number of CFAs in China.

CFAs make an annual salary of approximately 400,000 yuan, according to a survey among 100 CFAs in China.

Still, CFA hopefuls wanting to climb the ladder have their work cut out for them. Even though most of them hold a bachelor's degree, the passing rate for the exam is fairly low. Yu says scores can dip as low as 20 percent on average.

Analysts warn a growing talent shortage in Shanghai's financial services industry could spell trouble for the city.

As more and more financial institutions increasingly set up shop in Shanghai, the shortage of qualified workers with global financial backgrounds will slow the city's development as a financial center in China, says Yu.

The training industry, too, has its own share of challenges to overcome. According to CICN, only 60 percent of 3,300 Shanghai-based training organizations were able to profit more than 1 million yuan in 2007. These new companies did not even account for 1 percent of the market share.

Yet, despite industry challenges, demand for such training appears to be propelling the trend. Reports suggest further capital investments in the training industry will peak from 2008 to 2009.

(China Daily 04/07/2008 page3)