Despite some obvious challenges, China’s economy grew at 6.5% in 2018, with its GDP value representing nearly 20 percent of the world economy. Whilst, after a record year for hiring, there remains generally good market sentiment amongst the clients we speak to regularly, there has been towards the end of 2018 a slight sense of uncertainty. Clearly everyone is watching the trade war discussions between the US and China: and we will be watching that space very carefully in 2019.
The recent news of a truce in terms of tariffs has been welcomed and the ongoing negotiations will be interesting to track. For us at PageGroup we will be keeping close to three areas.
MNC vs Domestic company sentiment in China
When there is less favourable news on China, MNCs tend to get nervous quicker, with a wait-and-see approach on the prevailing climate before committing to significant hiring.
Yet China local domestic companies, many of whom have gained strength in recent years, are more guided by local activities in China. For example, these include an upcoming government reduction of the income tax rate, which could see people with some more disposable income and hence good for consumer led industries. Different markets are impacted in different ways but we generally expect domestic businesses to continue hiring positively.
Trade/Build more across Asia
Some companies will see the situation as an opportunity to increase trade more within Asia to replace any loss in US or other markets. Some may even consider moving some physical operations to other Asian markets, Taiwan and Vietnam seem to be popular beneficiaries. Trade levels may be similar, just shuffled around different locations. Again, opportunities will still exist, just different to what we are used to.
An opportunity to secure quality talent?
Whatever the case and whatever its impact, this will allow hiring companies to go out and find some high quality yet scarce candidates, who are keen to find new roles and move relatively quickly. This could be particularly true in very candidate short markets such as technology and healthcare. We also see rich opportunities arising in the education sector, with the government gearing up to boost investment across the spectrum, from early-life through to adult learning.
Ultimately, whatever the short-term outlook, China will still grow, and many of those who benefit from making strategic hires in the near future, will be those who stand the best chance of grabbing the rich opportunities around the corner.
What are you finding in your industry?
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