What's happening to those hot jobs in Beijing?
What impact will Beijing’s worsening pollution have on high-end jobs and talent? Senior international recruiter Max Price tells the story from the hazy frontline.
Beijing’s air pollution problems have been widely reported in the news lately. That Beijing suffers from high levels of pollution is nothing new, but the recent surge in media attention will push it to the forefront of people’s minds and will undoubtedly be a factor in deciding whether to take a job in the city.
A couple of high-profile expat employees at leading global firms recently decided they'd had enough of Beijing's pollution, and requested transfer to other locations, such as Germany or the United States. I have an American acquaintance who insisted on a “danger bonus” when relocating to Beijing solely because of pollution. So what does this mean for companies hiring in Beijing this year?
Recruitment in China has been a hot topic for some time. The abundance of opportunities as the country’s gross domestic product (GDP) has boomed over the last few years is extraordinary. The number of foreign companies that have opened in China during this period is phenomenal and salary increases in Tier 1 cities has soared for both multinationals and state-owned organisations.
China, therefore, is exciting from an employment perspective and Beijing is an attractive proposition to local employees and foreigners. But “quality of life” is one area, for employees, where Beijing falls down.
People tend to move jobs for one of two reasons: money and opportunities. If someone is offering you 50 per cent extra to do a similar job it makes sense to take it. If a company offers fantastic career progression that allows an employee to develop and feel challenged, it is an opportunity to be seized. It is here where the Beijing job market may face challenges in the near future.
At the start of the year, recruitment in Beijing was at a crossroads, companies could no longer support the dramatic increases in salaries that were historically offered, and candidates have been moving around far too often and do not have the required experience to command the expected salaries or the positions offered, so once you take away salaries and opportunities why would someone move to Beijing? Or, to put it another way, what other things would people consider before accepting a role in Beijing? This is an increasingly important factor when hiring in China, candidates, like consumers, are more aware of what is available in the market and are insisting that quality of life and the “work-life” balance be considered by companies hiring them.
In most other recruitment markets, quality of life is based around safety, education and healthcare facilities; cost of facilities compared with salaries and properties. In Beijing, health comes into quality of life, too. Anyone living in Beijing over the past two weeks will have noticed the yellow fog, the smell of exhaust fumes, seeing an unusual haze indoors, and the negative health effects of PM2.5 that have been widely reported as reducing life expectancy.
So what changes can we expect in recruitment? This is useful to split into three parts. Firstly, how will this affect recruitment of foreigners already in China, secondly, how it will affect the local workforce and, thirdly, the repercussions.
With regards to expat recruitment, despite the above information, the answer in the short term is probably very little will change. China’s GDP is still growing at an exceptional rate; opportunities remain and chances for career progression are excellent, so the main factors when considering a career change are still very favourable for Beijing.
There will certainly be more discussion about relocation to Beijing, and some talent will undoubtedly decide not to relocate because of pollution, but this is not a question that comes up at the beginning of the recruitment process. Now, candidates do not associate Beijing solely with pollution, the first words that come to mind are opportunities, salaries and careers with the negative factors well behind. This is likely to be the norm in the coming years unless there is a lot more bad press, but bad news about the economy is more likely to keep people away than the air quality.
As a foreigner, when you are offered opportunities in China, it is fair to say that the places that first come to mind are Beijing and Shanghai. Other parts of China are relatively unknown entities and a big part of relocation is the expatriate community. Beijing has a large expat community and this makes relocation there easier. With the extra burden of bad air quality, if the foreign community diminishes then so will the amount of foreign talent entering Beijing.
Recruitment of local staff should remain virtually the same. As recruiters we deal with candidates on a daily basis and not one local candidate has mentioned this without prompting. It is the way it is and probably the way it always will be – part of working in Beijing. A few candidates may use pollution as a bargaining point during contract negotiations. However, this is likely to occur during re-negotiation of contracts, once someone has already shown their worth to a company, rather than before joining. Local talent will still flock to Beijing due to other factors related to location – such as educational institutions and hospitals. Salaries in Beijing are still higher than most other parts of China. The good opportunities are still here.
Other potential repercussions are something I have not seen addressed in many places before and this is how recent pollution can affect recruitment in Beijing. News about pollution has been all over Sina Weibo, LinkedIn and other professional networking sites, as well as the local and international press. The main areas of disgruntlement seem to be within the current workforce. These are employees that have been in Beijing for a period of three or more years. They are now ready to move on after considering Beijing’s worsening pollution the last straw.
I have received a number of calls from local and foreign candidates with extensive Beijing tenure, who are now looking to exploit my international network to move to new places.
Foreigners who are looking to start families or have young families already are the most common professionals who call and send CVs. These people are nearly always business critical, high level managers within key strategic business areas. They obviously have to be replaced carefully. Maybe pollution is not all bad for Beijing’s job market in the short term. In the long term, however this cycle will repeat itself and continued bad press will have a dramatic effect. Foreign and local talent will decide their futures are not in Beijing, but in the upcoming tier 2 or tier 3 cities, or maybe, not in China at all.
Max Price is a Partner at Antal International China (Beijing).