Global firms go east – then head west on the mainland
One less usual way of gathering insights on global business trends is measuring the number of executives relocating to different countries. Going beyond trade figures and investment statistics, relocation data is a useful indicator of which markets and industries are on the rise, as it shows where companies need individuals who can run new projects or lead business expansion.
Perhaps unsurprisingly, the latest International Migration Study compiled by UniGroup Relocation shows an increase in moves to China during 2012. The US continues as the top country of origin for executives moving to Asia-Pacific. Hong Kong, as a destination for moves originating in the US, dropped from 12th place in 2011 to 15th last year, putting it behind the mainland, which was fourth, and ninth-placed Singapore.
The findings are based on 25,000 household removals that UniGroup Relocation handled globally last year.
“For some projects, we see seven or eight families from different parts of the world moving to China – a sign that employers need particular skill sets and are looking for more feet on the ground,” says Steve Lewis, Asia-Pacific managing director of UniGroup, which primarily relocates multinational-company executives and their families.
The data reflects greater overseas involvement in China’s western provinces, such as Sichuan, Yunnan and Xinjiang. Beijing and Shanghai remained
the top mainland destinations for foreign executives. Guangzhou recorded lower numbers, since many executives still tended to use Hong Kong as a stepping stone for southern China.
These days, the traditional manufacturing industries in the region are also less likely to need overseas expertise. Last year, though, saw a jump in moves to Chengdu, Urumqi, Suzhou and Nanjing. The surge is linked to corporate expansion in the energy, hi-tech and consumer-product sectors.
UniGroup also moved close to 150 people to Shenyang to work in car and truck manufacturing, a sector that also attracted foreign hires to Dalian and Changchun for senior jobs.
“[The determining factor] used to be where their joint venture partners were,” Lewis says. “But now, companies are looking to identify locations with potential tax breaks or the best new markets. For example, a second-tier mainland city with a population of four to five million offers massive revenue
potential for retailers.”
Some new China arrivals are taking on roles at senior VP or MD level. This is often a promotion and provides them with a chance to prove their mettle in a fast-developing market.
As well as senior executive positions, more people with extensive “operational” experience are also coming in to train and work alongside mainland staff, in everything from oil industry exploration and hospitality to luxury retail and accounting.
“As the mainland market matures, companies want to get up to speed,” Lewis says. “For that, they may need to bring in experienced staff in disciplines like HR, finance and project management. They are not just doing start-up operations, but expanding distribution channels and building major organisations.”