2018 Hays Asia Salary Guide: Mainland China’s employers cautious on new hiring despite growing confidence in the economy

• 63 per cent of businesses in Mainland China expect an increase in business activity in 2018

• 45 per cent of businesses in Mainland China expect to increase headcount in 2018

51 per cent of employers in Mainland China intend to award employees a salary increase of more than 6 per cent in 2018

Employers in Mainland China remain cautious about hiring despite growing optimism towards the economy and the business environment, according to recruiting experts Hays.

The 2018 Hays Asia Salary Guide, released today, reveals that while 63 per cent of businesses in Mainland China expect an increase in business activity and 49 per cent expect the economy to strengthen in 2018, only 45 per cent expect to increase headcount.

The 2018 Hays Asia Salary Guide highlights salary and recruiting trends drawn from more than 3,000 employers across Mainland China, Hong Kong, Japan, Malaysia and Singapore representing six million employees with salary ranges reported for more than 1,200 roles.

“Our survey findings’ shows the vast majority of employers in Mainland China are optimistic about strong economic growth and business activity in 2018. We believe this positive sentiment will eventually lead to more businesses increasing their headcount to take advantage of the promising economic and business landscape,” says Simon Lance, Managing Director for Hays in Greater China.

Despite the soft hiring plans as reported, 51 per cent of employers in Mainland China plan salary increases of more than 6 per cent which is 24 per cent more than the whole of Asia combined. A further35 per cent plan salary increases of 3-6 per cent as businesses look to retain talent in 2018.

“Recruitment and retention of talented employees remains a key factor in the success of any business, and employers in Mainland China recognise that salary increases are one way to keep their best people on board,” adds Simon.

However, our survey also found there is a disconnect in salary expectations between employers and employees in Mainland China. 85 per cent of candidates surveyed expect a salary increase of more than 6 per cent this year vs the 51 per cent of employers who plan to offer the same increase

Skills Shortages

This year for the first time, employers were asked how confident they are that they will be able to ‘recruit candidates with the skills needed to meet their needs over the next 12 months’. In Mainland China 82 per cent of businesses said they are ‘very confident or confident’.

Yet business in Mainland China are concerned about skills shortages. 98 per cent of employers said skills shortages have the potential to hamper effective operations and 34 percent said they don’t have the talent needed now to achieve business objectives. 37 per cent of businesses have up-skilled their workforce to address immediate skill shortages.

In Mainland China, employers reported that the top five hardest roles to recruit are: 

• Middle management R&D roles, 
• Middle Management sales roles, 
• Middle Management engineering roles, 
• Middle management marketing roles
• Middle management operations roles.

“Employers need to remain mindful of the skills that they require from their workforce not only now, but also over the coming years. Investing in training and up-skilling can help businesses better prepare their workforce for the future,” says Simon.

Bonuses

In the coming year, only 46 per cent of employers in Mainland China intend to award bonuses to more than 50 per cent of their workforce, the lowest ratio among employers in Asia. Our survey found that the vast majority of candidates in Mainland China (57 per cent) are unhappy with their total compensation package that includes bonuses and benefits.

Benefits

Across all Asian regions surveyed, 83 per cent of employers offer benefits to employees in addition to salaries. In Mainland China where 73 per cent of employers offer benefits, the most popular offered are health/medical benefits (63 per cent) and housing allowance (40 per cent). Flexible working benefits are also becoming more attractive to employees. The most commonly offered arrangements are flexible working hours (67 per cent) and flex-place (43 per cent).

Other key findings

In a rapidly-evolving job market, only 53 per cent of employees in Mainland China believe their current skills will still be in demand by employers five years from now. This is higher than Hong Kong (48 per cent) and Japan (33 per cent), but lower than Malaysia (67 per cent) and Singapore (66 per cent).

The number of employees in Mainland China willing to relocate overseas for work fell to 61 per cent compared with 69 per cent in the previous year. This may be a reflection of the growing public confidence in the Chinese economy, greater opportunities amid the trend towards higher domestic investment by Chinese companies and the emergence of a greater number of world-class local enterprises.

Mainland China continues to improve its gender diversity performance with 37 per cent of management roles held by women, an increase of two per cent on the previous year and just behind Malaysia who ranks first in the region with 38 per cent. Overall, more needs to be done to get female talent into management roles across Asia. Japan is at the bottom of the table with only 22 per cent of its management roles held by women.

This year’s report has found that there are more foreign workers employed in Mainland China compared to our previous report. Currently, foreigners make up 10 per cent of Mainland China’s workforce which is up four per cent. However, the country still lags behind other Asian regions for employing overseas talent and is joint bottom with Malaysia. Singapore (19 per cent) and Hong Kong (14 per cent) remain the largest employers of foreigners in Asia.

Download your copy of the 2018 Hays Asia Salary Guide by visiting https://www.hays.cn/en/salary-guide/index.htm or by contacting your local Hays office.