Employment in China's Domestic Firms Levels Up Competition Against Western Companies [VIDEO & REPORT]

By Jobs & Hire Staff Reporter | Dec 12, 2013 11:09 PM EST

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Many foreign companies operating in are facing fierce worker competition from domestic companies in China, according to a Wall Street Journal report.

For a long time, western companies operating in China have been enjoying a surge of workers applying or working in their offices. Western companies have been known to provide Chinese jobseekers better pay, countless training and travel opportunities. Now, China's domestic companies are offering more stability, and according to the Wall Street Journal report, increasingly offering more pay.

CEB, a membership group for Western and Asian multinational companies, conducted a survey of 165,000 people last year and showed that 47 percent of China's workers preferred to work at a domestic Chinese company, while 24 percent preferred working at a foreign firm. The results of the survey showed a dramatic shift that could not have been imaginable five years ago when only 9 percent of workers in China preferred working for a domestic company and 42 percent for a foreign company.

"There's been a long-standing foreign employer premium that's now gone in China," Brad Adams, head of Asia research for CEB, told the Wall Street Journal.

The result of this worker employment trend led western companies like Procter & Gamble Co. and General Electric Co. (GE) to sweeten the perks of working for them. Currently, these two companies have raised their travel opportunities and other benefits. GE said that its entry-level salaries in their China operations have increased between 3 percent and 5 percent in recent years. Another company, W.R. Grace & Co., a company that manufactures specialized chemicals, has raised its Chinese employee salaries an average of 8.5 percent this year in order to compete with domestic companies.

According to Richard Pranell, chief executive of recruiting firm Rober Walters' Asia Pacific office, some western companies operating in China are now taking radical steps to review their salaries on a quarterly basis to stay ahead in the competition. Western companies are known for salary reviews on an annual basis.

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