China companies see staff turnover rise, paying more for retention

Companies in China are struggling to retain professional and support staff and must pay higher salaries or high recruitment costs, Mercer Human Resource Consulting said.

The human resources and financial consulting firm surveyed 114 companies in China and found that 54 pct have experienced higher turnover for professional staff since last year, while 42 pct experienced increased turnover for support staff in the same period.

The average tenure for employees aged between 25-35 years - the age bracket targeted by most multinational firms - fell to just 1-2 years in 2005 from 3-5 years in 2004, Mercer said in a statement.

'The employment market in China has ignited in recent years, as more multinational organizations set up operations there and local companies expand. Individuals with transferable skills have become a valuable commodity and companies are battling to keep hold of them,' Mercer said.

Mercer said the costs of replacing staff at any level is around 25-50 pct of the employee's annual salary, and up to 200 pct of salary for senior staff.

The survey found that 83 pct of the surveyed Chinese and foreign companies provide their employees with health insurance, while 41 pct provide health and fitness plans and 24 pct offer flexible working conditions.

However, 44 pct believe that their employees are dissatisfied with their benefits, according to the survey.

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