The recruitment demand in Shanghai will continue to shrink in the first part of this year amid the deepening financial recession, but a recovery is expected in the latter half, according to a white paper released by a local human resources association Tuesday.
The paper, released by the Shanghai Human Resources Consulting Association (SHRCA), said manufacturing and financial industries, including steel, automobile, banking, insurance, and logistics are set to bear the brunt of the layoffs.
"Economic readings have shown that the impact of the financial meltdown on Shanghai is severer than most of the other cities due to its foreign-oriented economy," said Gu Jiadong, chairman of SHRCA.
Gu added that last November alone, 2218 employees were laid off, accounting for 0.79 percent of the total headcount in the 7000 multinationals SHRCA surveyed.
Shanghai had attracted over 184 multinationals to set up their regional headquarters as of last January, according to figures from Shanghai Headquarters Economy Promotion Centre.
However, the growth rate of the number of foreign companies and their employees in Shanghai are expected to decrease by 1.3 percent and 0.5 percent respectively in the first half this year, if compared to the 7.8 percent and 13.4 percent increase in 2008, the paper showed.
"We've perceived a sharp recruitment slowdown from our clients since last November, and the situation is getting worse coming into this year," said Sun Jing, a consultant at an international recruitment services company Wang&Li Asia Resources.
Smaller multinationals that face capital crunch are more likely to downsize personnel structure and cut staff benefits to weather the hardships, said Chen Shaozhang, vice-chairman of SHRCA.
The human resource industry will be severely hit from February to July when the ripple effect of financial crisis passes down, Gu said.
However, Grace Cheng, country manager of executive recruiting services provider Russell Reynolds Associates Inc in Greater China, said that sectors boosted by the 4 trillion yuan stimulus package, like infrastructure construction and consumer goods, are still in demand for staff.
"We believe that the human resource market will recover when the domestic demand-driven policies materialize," Cheng said.
The number of multinationals and their employees in Shanghai will grow by 5.6 percent and 5.3 percent in the second half, after a considerable drop in the first six months of 2009, the white paper predicted.
(China Daily January 7, 2009)