The Decision To Pursue Your Career In China From The RegionOver the past ten years, Wang & Li has recruited and placed just about every category of bilingual/international-caliber professional, from the middle to executive management levels and including “homegrown” mainlanders, mainland returnee, regional, and overseas Chinese from around the world. From our work in this field, we are quite familiar with both the motivations and expectations that individuals have and the current realities of the market in China. As such, the following are some key things to know when considering a move to pursue career opportunities in China. The Ideal CandidateFrom our experience in placing top quality candidates with leading multinationals in China, we have come to determine an ideal candidate profile based on what is consistently sought by our clients. No matter the industry or function, we always identify six factors in potential candidates that are common to any management-level hiring situation for an international company. They are:The Ideal Candidate: High Caliber (able to handle management/senior management-level roles and responsibilities) Bilingual International-oriented Affordable Track record that shows ability to perform and get results in China Realistic expectationsFor bilingual skills, the English language abilities of many mainlanders at management levels has become quite good and is not a critical obstacle for them anymore. Their international exposure and global capabilities and mindset are also improving rapidly to the standards and expectations of multinational companies here. Mainland professionals also have a clear advantage over regional and overseas Chinese professionals in the area of affordability, since compensation structures are all being localized to their level. In addition, the ability to operate effectively and get results in China is a natural advantage to “homegrown” mainland professionals since by definition they have developed their entire career here. As a result, their market knowledge, network of business relationships and resources, as well as understanding of the business culture that are critical for many positions here are typically stronger than those who have developed much of their career outside of the mainland. Realistic ExpectationsRegarding realistic expectations, many mainland returnee, regional, and overseas Chinese professionals can be out of touch with what it takes to successfully perform and handle situations here in China. For such professionals entering/re-entering this market, they face the challenge of convincing and then demonstrating to multinational employers that they can get the kind of results in the mainland that they’ve gotten elsewhere. It is well known that everyone coming to this market goes through a learning curve of adjustment when they start doing business here. For most, it is a very steep one. Although professional standards and business practices are rapidly internationalizing, the cultural differences and traditional mindsets present challenges to anyone who has not worked in China before, or who has been away for a while (e.g. mainland returnees who have gone abroad for more than five years). Without exception, it takes some time to figure out how to perform effectively here. The Decision To Move Here Must Be Driven By You, Not ThemOne of the first questions that we get from clients each time we introduce an overseas candidate to them is, “what is their motivation for wanting to move to China?” Companies here do not want to entice anyone into joining them from abroad. They are not interested in having to convince someone into coming to China, or explaining to them why they should make the decision to pursue an opportunity in this market. Rather, they expect such candidates to be personally motivated and already strongly oriented in their desire and objectives to be here. If employers sense this is otherwise, they won’t even bother pursuing you.The viewpoint and position of multinational employers here is that they can offer excellent opportunities as a leading global company in the world’s fastest growing and largest market. They recognize that there are lifestyle and personal trade-offs to be considered and made for every person. They also recognize that the financial picture is very important to anyone, but that it may not be clearly better immediately. Their approach is based on what just about everyone who has made a decision to come out here and work in China understands. And that is, if you have the patience and capability to demonstrate what you can do in this market, then you’ll do very well in terms of both financially and career opportunities. This is proven out time and time again and is the reason that China is able to attract so many talented and capable people.It is important to understand that when it comes to working in China for the first time, or after several years of working abroad, the risk factors are not only on your side. There is risk as well for the companies here that are hiring you. Their concerns are based on the costly, difficult hiring and employment mistakes they have experienced, where many returnee, regional, and overseas Chinese simply did not deliver the performance or meet the results expected of them. As a result, multinational companies here are far past making hiring decisions based on claims, qualifications, and international backgrounds, in the way they often did in the past. The Compensation TopicFar beyond a trend anymore, the compensation structures of multinationals operating in China today are well-rooted in the approach and practice of localization. Companies no longer feel it necessary to offer premium packages to attract talent from abroad. What they are willing to offer overseas hires who first come to this market are localized salaries that are competitive internationally when looked at on a net basis (e.g. after tax, living expenses, rent, etc.). The fundamental principle that employers go by, as well as the reason why so many professionals choose to come back to develop their career here, is that financial rewards will come to those who can demonstrate their performance in this market. This, however, takes some time to demonstrate. But we’re not talking about that much time. After even just one year, your marketability and the opportunities available to you in this market grow exponentially better. The concerns that companies may have about your capabilities to perform in this market begin to disappear. This is a result of the relationships and reputation, and experience and track record of achievement that you begin to built up in this business environment. For regional professionals, there are certainly excellent opportunities available in China. However, these days, the compensation structures for positions from manager to director levels for multinationals here are local ones. For those currently working in the region and contemplating a move to China, that might mean a 20-30% cut in actual amount terms from what you are making/can make in elsewhere. In relative compensation terms, however, the lower amount in China provides for a comparable salary level and lifestyle when looked at from a net take-home perspective, after living expenses, rents, taxes, etc., which are considerably lower in China. Please see such a net comparison in the following example: Net Compensation Comparison Hong Kong China Base Salary $100,000 $70,000* Taxes (15% flat tax rate) $15,000 $15,686 (30% - standard deduction, for this bracket) Rent (USD3,000/mth) $36,000 $12,000 (spending USD1000/mth) Living Expenses (spending USD1,500/mth) $18,000 $9,600 (spending USD800/mth) —————————— Net $31,000 $32,714 ﹡﹡ All numbers reflect US$ amountsWhere the career and financial pay-offs really begin to occur are after your first year here, through faster promotions into these higher level roles and opportunities. In China, you can see and meet so many relatively young professionals who are managing and running substantial pieces of business and responsibilities. And as they rise more quickly into higher-level positions, so do their compensation levels.Highly Favorable Market For Excellent Management TalentThe underlying principle to understand in this market is, if at a later point your company is not willing to compensate you for your value in this market, then there are many other companies that will. It’s the nature of the talent and hiring market here currently. The need and demand for highly capable management and senior management professionals who can perform in this market is and will continue to be strong among growing multinational firms doing business here. With China’s headhunting industry an active and aggressive one, good people become known and are actively pursued. Of course, it is reasonable for anyone to negotiate the best compensation terms possible when pursuing an opportunity here. But you also need to be reasonable and in touch with the realities of the current market. Besides the motivation question, the other question we get from our clients each time we introduce an overseas candidate is, “what are their expectations?” We always tell newcomers to China to look for a fair compensation level, one that does not compromise the lifestyle you’re accustomed to. That standard can be comfortably maintained with the local salaries being offered to overseas hires today, particularly given China’s reasonable tax structure and the considerably lower cost of living here. It is with this perspective in mind that many are making the decision to return to China to pursue their career and future.Is This The Right Move For You, Both Professionally And Personally?From what we see, those who decide to come out here tend to take a well-rounded approach that is based on several overall decision factors. Fundamentally, they feel that there are excellent opportunities in this aggressive and less mature market that offers greater career growth opportunities in comparison to markets overseas. In understanding the current challenges and realities of working here, and in response to the needs of international employers in the mainland, they are confident in what they can deliver and in their ability to excel/stand-out in this market. The career and financial benefits that many determine and focus on most are:Quicker Promotional Tracks – because of the much higher growth rates companies are experiencing in China, promotion times are typically faster here. The middle to senior management bottlenecks found in the U.S. and Hong Kong do not exist in the mainland. In other words, the cream rises to the top here. Opportunities You Would Not Have, Or Would Not Reach As Quickly Elsewhere – The aggressive expansion of multinationals allows many to move into business development, front-end, and management roles that they were not likely to break into in the U.S., at least within the same time frame This is commonly seen in the people who are holding positions and handling responsibilities that would not likely be doing if in other markets. Net Income – When comparing financial compensation between the U.S. and China, it is important to look at net income, or the money you put in your pocket. For instance, USD60K/year in China is somewhat comparable to USD100K in Hong Kong after comparing and factoring in taxes, rental costs, and living expenses, which are all less in China. Additionally, most also have other reasons for coming out, whether that is an entrepreneurial spirit that they wish to fulfill, a connection or interest in the culture and experience of living in China, and/or personal/family relationships that they can be closer to. Overall, however, their decisions are often based on more than on just financial and career criteria. What we tell regional candidates who are weighing an opportunity in China is that realistically, they can expect a fair and reasonable compensation package when they first come out to work here that is in-line with this market and with what they may be netting overseas. But the prevailing attitude and viewpoint of both multinational employers and individuals here is that if you can prove yourself in this business environment, then the opportunities and rewards will come. If you’re able to match your own outlook and expectations to the situation out here currently, then finding an excellent opportunity for you should not be too difficult.
