In the old days, when the Japanese management style helped to push Japan to the top of the economic stratosphere, Japanese corporations often laughed at the inefficient operations of their Chinese counterparts.
But now, as fast-growing China is set to overtake Japan as the world's second-largest economy, Japanese companies find themselves near the bottom of the pecking order in terms of hiring in China.
The most talented Chinese are flocking to Chinese, U.S. and European companies that offer higher wages and better chances for promotion than Japanese companies. Other skilled workers are fleeing their Japanese employers for more promising futures at Chinese firms.
And even Japanese workers, who could be regarded as the new "cheap labor" in China, are turning to foreign companies.
A job offer posted on a website for MBA graduates from a prestigious Chinese university underscores how rising salaries in China are luring elite workers.
It said: "Offer from a head-hunting firm. Post of deputy manager, sales headquarters, at a major sports gear company. Experience at a foreign firm in the same business required. Annual pay 1.5 million yuan (19.5 million yen, or $230,000)."
"It's adequate because the rivals are such popular makers as Nike of the United States or Adidas of Germany," said a member of the group. "No one would take the post for 1 million yuan."
Until five years ago, 1 million yuan could hire someone as CEO, said pioneer head-hunter Louisa Wong, founder of Bo Le Associates Ltd., a Hong Kong-based executive search company specializing in Chinese.
One million yuan can now hire only up to a business manager, she said.
Foreign companies used to come to China for cheap labor, but they now need market-knowledgeable people who understand regional differences, can liaise with government officials and lead sales strategy in the country.
According to Wong, the annual salary for a CEO is 2 million to 3 million yuan--a level beyond what ordinary Japanese companies can pay to people in charge of their Chinese operations.
Wong said multinational companies want a "superman" who can handle any task related to developing the Chinese market.
She said her business remained brisk even during the financial crisis that started in fall 2008.
Pierre Zhuang, chief of Bo Le's Shanghai operations, worked for the Chinese arm of Suntory Ltd. when he was recruited by Wong to the nascent head-hunting industry.
The market in China grew tenfold in the past 10 years to 20 billion yuan. Zhuang foresees another tenfold increase in the coming decade.
Bo Le has further expanded its business this year by concluding a deal with Japan's Recruit Co., which obtained a 14.3-percent stake in the company.
Dai Huaizong, chief at the Chinese arm of French electronics and cookware maker Groupe SEB, used to work for another European company. He earns nearly 4 million yuan a year, according to a company that head-hunted Dai.
Yao Mumu, 32, who left a foreign accounting firm in Beijing for the post of deputy financial director at a Chinese infrastructure firm, said phone calls from head-hunters are almost an daily occurrence.
A qualified accountant, Yao earns 400,000 yuan a year, far higher than the income for ordinary Chinese business people.
But she says: "The chances are 90 percent that I will switch jobs in five years. My annual income will perhaps be 1 million yuan then."
However, most Chinese aren't automatically offered huge salaries; they have to work at it to reach that level.
The average monthly wage of workers is 3,700 yuan, even in Beijing, where payments are relatively high. And in a tight job market, new college graduates' initial monthly salary is 3,000 yuan on average.
Changing jobs is one common way to increase one's fortunes, according to Zhu Xiaodong, who runs a marketing company in Beijing.
While an employee could expect to earn only up to 10,000 yuan a month after working many years, "the wage will jump to about 50,000 yuan if you switch jobs after getting new qualifications or building careers," he said.
An MBA degree is one of those qualifications deemed a "ticket to high-paying jobs."
About 78,000 people applied to MBA courses in China in 2010, twice as many as three years earlier.
Gao Xudong, director of the prestigious MBA program at Tsinghua University, said a major change has occurred among the course's graduates in the past five years.
"Most obtained jobs in foreign-affiliates before, but now a majority of our students are aiming for places in domestic companies," Gao said.
China's state-owned enterprises were once infamous for their inefficient management. But they are now regarded as the engine for the nation's growth, and they attract MBA holders by offering favorable benefits packages.
One female student in Tsinghua's MBA program worked for Mitsui & Co.'s local operations and then for Toyota Motor Corp.'s joint venture in China.
The 29-year-old says Toyota's inhouse training program was superb, but she found the daily overtime work unbearable.
Her Chinese colleagues, who went to Chinese automakers or Germany's BMW and Daimler, saw their wages almost double.
"(Toyota's) training is excellent, but the working conditions were bad. It has become a reaping ground for other businesses," she said.
The student said that once she obtains her MBA, Japanese companies will be off her radar in terms of employment.
She is not alone. Many who change jobs say they try to avoid Japanese, South Korean and Taiwanese companies, which have three problems in common: demanding work, low pay and little chance of promotion.
Personnel resources companies in China say wage levels at U.S. and European companies are about 1.5 times that of Japanese firms.
"If you offer salary levels of the past, then Chinese employees would flee," said Li Jun, 33, who quit an NEC Corp. affiliate to found a venture business in the environment field.
In good years for business, Li earns up to 100 million yen.
Born in a poor village in Sichuan province, Li said: "Because we can't foresee the future (in an unstable society), we want to build assets quickly. Companies are not aware of such pressing needs among Chinese workers."
A 33-year-old Chinese graduate of the University of Tokyo, who works for an independent administrative agency in Japan as a researcher, was surprised when he started looking for work in Beijing.
A major Japanese information technology firm offered only a quarter of what he earns now.
"That's so meager even though prices in Beijing are much lower than in Tokyo," he said.
A Chinese telecommunications firm, on the other hand, offered to match his pay in Japan.
"Chinese pay great attention to room for growth, such as how much the company will grow and what they would be allowed to do there," the man said, adding that Japan today doesn't offer such opportunities.
SEB's Dai also says promotion is a huge factor.
Dai has served as chief of Apple Inc.'s Chinese arm. "If Japanese companies do not entrust the post to Chinese, then they are not among the options."
Bo Le's Wong also points to the low level of CEO salaries at Japanese businesses.
Seeking equality among employees may be a Japanese business feature, but it does not work in China, she said.
Some Japanese corporations, such as trading house Mitsubishi Corp. and machinery maker Komatsu Ltd., are taking steps to promote Chinese employees to executive positions.
A locally hired Chinese was promoted to an executive post at Mitsubishi's Dalian subsidiary last year.
And in the Chinese offices of some major Japanese companies, there are cases where Chinese employees earn more than their Japanese colleagues.
But Jin Rui, general manager of Intelligence (China) Co., a Shanghai affiliate of Intelligence Ltd. of Japan, said most Japanese companies still put too much emphasis on Japanese language proficiency in hiring Chinese.
Meanwhile, as Chinese workers fetch higher salaries, young Japanese have emerged as lower-cost workers.
A 29-year-old Japanese man at a major U.S. call center in Dalian was surprised last summer to find his Chinese colleague was paid 13,000 yuan a month, much more than he got.
The employer raised the wages of Chinese after many hopped to a higher-paying U.S. rival and others demanded pay increases.
In Dalian, many offices are being set up to provide outsourcing services for Japanese businesses.
Such offices used to hire mainly Chinese, but they now are turning more to Japanese, who have difficulty finding jobs back home.
"There have always been openings for Japanese," said Wang Jin, head of Pasona Tech Dalian Co.
Chinese workers capable of speaking Japanese have strong academic backgrounds, but their initial pay is still generally lower than Japanese employees.
But in the industry, Japanese are said to be "low cost on the longer term" because they do not demand pay raises as Chinese do.
Japanese also tend to stay longer at one company, well aware of the tough job situation in Japan.
A major U.S. computer maker is also hiring Japanese for its call center in Dalian. In late October, five were newly employed from Japan, and their comments reflect the vast differences between the Chinese and Japanese job markets.
Ayaka Sakurada, 25, graduated from a British university but could not find a job in Britain or Japan. She has decided to study Chinese, too.
Yusuke Umewaka, 31, earned 270,000 yen a month at an apparel shop in Tokyo, but gave up on the "shrinking" retail sector in Japan.
A 28-year-old man quit a listed Japanese company, where he earned 6 million yen a year. He found his former employer, who rejected his proposals for new business, hopeless.
Junko Oishi, 36, came to Dalian after twice losing temporary staff jobs after the 2008 financial crisis. She says she could not expect to find a good job in Japan.
(This article was written by Tokuhiko Saito and Tetsushi Yamamura.)
http://www.asahi.com/english/TKY201012270252.html
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