Companies in China battle to keep hold of professional and support staff

Companies in China are struggling to retain their professional and support staff, and face either having to pay higher salaries or excessive recruitment costs, according to research by Mercer HR Consulting.

Companies in China are struggling to retain their professional and support staff, and face either having to pay higher salaries or excessive recruitment costs, according to research by Mercer HR Consulting.

The survey of more than 100 organisations in China, many of which are multinationals, shows that 54% have experienced an increase in turnover for professional staff since last year, while 42% have reported higher turnover for support staff.

It also found that the average tenure for 25 to 35-year-olds – the age group targeted most by multinational companies – fell from an average of three to five years in 2004, to just one to two years in 2005.

Brenda Wilson, principal at Mercer, said there had been a surge in China's employment market as more multinational organisations 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,” she said.

Wilson said that this situation had led to employers offering benefits traditionally associated with Western businesses.

“Those that offer variable pay, promote ‘softer’ benefits like flexible working and provide meaningful career opportunities are most likely to keep hold of their best employees,” she said.

The research also found:

• 83% of organisations offer healthcare and related insurance to staff
• 41% provide health and fitness plans
• 24% offer flexible working.
• 44% of organisations believe their employees are dissatisfied with the benefits on offer
• The average cost of replacing staff at any level is around 25% to 50% of annual salary.

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