Employment outlook weak

Job supply falls as gdp growth slows, say experts

Chinese employers' hiring intentions will weaken in the second half of 2013 but the employment rate is not a problem yet in China, human resources agencies say.

"China's net employment outlook slipped to its weakest level since the first quarter of 2010 after employer hiring plans fell in all industry sectors and all regions," Manpower Group, a global workforce provider, says in its employment outlook survey for the third quarter of 2013.

The firm uses its net employment outlook to describe employers' hiring intentions.

The Chinese mainland's net employment outlook is 12 percent in the third quarter of 2013, declining by 5 percentage points compared with the same period of 2012, Manpower says in its report.

Statistics from the survey show that 14 percent of the employers expect to increase payrolls in the third quarter, 2 percent anticipate a decrease and 45 percent forecast no change.

Zhaopin.com, one of China's largest providers of human resource services, says recruitment growth in the first half of 2013 was 20 percent, falling by 6 percentage points compared with 2012.

The job supply is related to the country's gross domestic product growth, so as China's GDP growth slows down, so does employment, experts says.

Some institutions have different opinions on China's GDP growth in the second half of the year. Nomura Securities, the most pessimistic, forecast a 30 percent possibility that China's GDP growth will fall below 7 percent in the second half of the year.

However, China's employment market is still steady because the workforce supply is declining alongside falling demand.

"China's employment market will be steady in the short term because China's working-age population is also reducing," says Du Yang, a professor with the institute of population and labor economics at China Academy of Social Sciences.

Statistics from the National Bureau of Statistics show the working-age population in the mainland fell by 3.45 million in 2012 compared with the end of 2011.

There is a risk that if economic growth keeps slowing down, the human resource costs will rise and then the labor-intensive enterprises will be under heavy pressure running their businesses, Du says, adding it will lead to job cuts.

Economic transition is a fundamental solution to making sure new technology-intensive and capital-intensive enterprises will offer job opportunities after labor-intensive businesses are eliminated.

This year's graduate employment is a result of unrealized economic transition, Du says.

College graduates with higher technology skills can meet the demand to improve productivity but there are not enough jobs for them because labor-intensive enterprises still account for the main part of the economy, he says.

On the other hand, the employment in different industries reveals contrasting situations.

"The real economy reflects obviously whether the economic development is healthy, which means secondary industry is affected most by macroeconomic growth," says Hao Jian, chief consultant at Zhaopin.com.

Manpower's report also shows that hiring intentions will weaken in the finance, insurance and real estate sectors with a 20 percentage point decline year-on-year in the third quarter of 2013. Mining and construction sectors will suffer an 11 percentage point year-on-year fall.

"Much of the (employment) weakness stems from considerable declines in China's finance and construction sectors," Manpower says in its report.

Recruitment in the telecommunication, consulting and information technology sectors will increase slowly this year compared with 2012, Hao says.

Tertiary industry will contribute more to the employment market. Urbanization is good news for job opportunities in tertiary industries.

Job growth in healthcare, retailing and luxury goods sectors will keep going up, Hao says, although these are not main sectors in the employment market traditionally.

Some human resources management companies have moved their businesses to the rising industries.

"Antal has conducted business in the consumer goods and service-related sector since two years ago," says James Darlington, head of Asia at Antal International, a United Kingdom recruitment and training consultancy.

He says it is easier for the consumer-related industries to cover the rising cost of human resources in China.

Employment in the third quarter will remain very strong in the sectors, Darlington says. July could be the firm's best month this year in terms of recruitment numbers.

The fourth quarter may have some seasonal slowdown but the majority of its clients in consumer-related industries are still very optimistic about the job market, he adds.

wangwen@chinadaily.com.cn

(China Daily Africa Weekly 07/26/2013 page23)