Competition for professionals drives salaries By Li Wenfang (China Daily) Updated: 2005-09-28 08:42
GUANGZHOU: Both employee turnover rate and salaries have risen in Guangzhou,
capital of southern China's Guangdong Province, at a time when the local human
resource (HR) market continues to be highly competitive.
This was unveiled yesterday by International HR consulting firm Hewitt
Associates after its annual survey on compensation and benefits in the city.
A total of 290 companies, about 90 per cent of which were foreign-invested
firms, took part in the survey.
Employee turnover rate in the non-manufacturing sector in Guangzhou has risen
from 11.4 per cent last year to 14.6 per cent this year, according to Hewitt.
The rate in the manufacturing sector has grown to 13.4 per cent from 10.7 per
cent.
At the same time, the average turnover rate in China has increased from 8.3
per cent in 2001 to 14 per cent this year.
The highest turnover rates in the non-manufacturing sector, which considers
the areas of marketing, human resources, sales, finance as well as research and
development (R&D), ranged from 13.4 per cent to 21.5 per cent. This is
largely in line with the situation in the entire country.
The most serious specialist shortages in Guangzhou exist for top management
and senior professional positions.
Salaries have been rising across the board in Guangzhou, with the fastest
raises seen for senior professionals and managers, or 8.4 per cent and 8.2 per
cent annual increases respectively.
"Simply having a presence in China no longer presents a competitive advantage
for multinational companies (MNCs)," said Jean Lin, head of compensation and
benefits consulting for Hewitt Associates in China.
It is important for MNCs to integrate human resource policies and practices
in their overall business plans, Lin said.
As the market for talented professionals will continue to be highly
competitive, companies must offer competitive remuneration packages, that take
into account both payments and benefits, Hewitt suggests.
Greater emphasis should be placed on retention-based schemes, typically in
deferred cash.
The survey also revealed that pension schemes are receiving more attention
because of demographic and regulatory changes.
Supplementary medical and insurance plans are at a significant level in the
market and there is a trend towards greater flexibility in benefit schemes.
(China Daily 09/28/2005 page10
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