Shanghai tempts global talent with higher pay
Shanghai is taking on its regional city rivals, including Hong Kong, in the race for global talent by offering higher salary incentives and senior positions to executives.
As a result, the salary gap between Shanghai and established regional financial centres for business executives is narrowing, as employers based in the mainland's commercial capital constantly increase pay benefits to court senior-level managers amid severe skill shortages.
According to British recruitment agency Hays, a chief financial officer employed by a multinational company in Shanghai could earn up to 20 million yuan (HK$24.5 million) this year, a rise of 25 per cent from 2011. In Hong Kong, the salary for the same position remained unchanged from a year earlier, at HK$28 million.
Attractive payscales are prompting more foreigners in Hong Kong and other major economies across Asia to look for job opportunities in Shanghai, and the trend is set to continue, according to Nigel Heap, managing director of Hays Asia Pacific.
'The economy is expanding [in Shanghai], faster than anywhere else in Asia. You are more likely to make a name here than you are in a more mature market,' he said.
Beryl Chu, executive vice-president of Chicago-based executive search firm DHR International, said many candidates in the United States and Europe were looking to secure jobs in China for better career advancement. Multinational companies (MNCs) were also offering expatriate packages, including children's education and housing allowances, to attract qualified professionals and managers as well as engineers.
Nevertheless, businesses are unfazed by the ever-increasing human resource costs as they desire to tap the huge potential of the vast mainland market.
According to a Hays survey based on 900 employers and data from 5,000 vacancies, 29 per cent of mainland businesses are expected to raise wages by more than 10 per cent this year. In Hong Kong, only 5 per cent of companies plan to do the same.
An additional 52 per cent of mainland-based employers expect to increase salaries by between 6 and 10 per cent, the survey shows. Last year, 21 per cent of mainland-based employers offered salary increases of more than 10 per cent.
In Shanghai, sectors including oil, information technology, education, new energy, and life science are facing the most severe shortage of skilled managers and engineers, according to Hays.
Two-thirds of the survey respondents predicted business activity would expand on the mainland over the next 12 months, but they admitted that skill shortages would hamper business operations.
'Recently, Asian regional offices of MNCs moved largely from Hong Kong and Singapore to Beijing and Shanghai,' said Chu.
'The need for senior-level managers increased significantly.'
But foreign professionals in the finance and banking sectors will find it more difficult to find jobs in Shanghai than in previous years, when their skills were badly needed to bolster the city's plan to become an international financial centre. Sean Ng, general manager at Hays China, said: 'Financial institutions expanded too fast in the past years and the pace will likely slow this year.'
Foreign direct investment, in US dollars, that poured into China last year - a 9.7 per cent rise from 2010 - despite economic turmoil