By Ellen Yin, Assistant Manager, HR, Dezan Shira & Associates Shanghai Office
COVID-19 has caused great disruptions to China’s economic activities. Industries, such as catering, tourism, film and television, and retail, have been hit badly due to the pandemic outbreak. Many enterprises, especially small- and medium-sized enterprises (SMEs), have had to suspend new hiring or even downsize staff to cut labor costs and survive financial difficulties.
That said, now is also a great time to reconsider the firm’s human resources (HR) planning and recruitment arrangement. Here is why.
Firstly, SMEs can evaluate and adjust their business development plan, dissolve unnecessary business units, and set up new lines of business that meet the new market needs.
Although the COVID-19 pandemic has taken a toll on many industries, some industries, such as healthcare, e-commerce, online education, online medicine, telecommuting, and gaming, have seen explosive growth. Overall, COVID-19 will have a profound impact on future economic activities. To stay agile, enterprises should seize new market opportunities to achieve business transformation and stabilize their core business. For example, in the early days of the infectious outbreak, Chinese electric-vehicle maker BYD launched the world’s largest medical mask plant to meet the huge demand of masks at home and abroad.
Compared with large companies, SMEs can be more flexible in achieving business transformation. They can reorganize their HR structure and start recruiting talents more quickly to prepare themselves for potential changes. Given their limited resources, such entities must be adaptable to survive and stay relevant in the market.
Secondly, SMEs should develop medium- and long-term human resource planning strategies to prepare well for new challenges in the post-COVID-19 era.
COVID-19 is now under control in China. Daily life and economic activities are gradually returning to normal. To restore the economy, the Chinese government has issued a series of preferential policies that will be effective until the end of 2020, including tax and fee cuts and social insurance exemptions. It is a rational choice for foreign companies to do business in China, under the current circumstances.
Moreover, it would be much easier for SMEs to locate targeted talents with lower employment costs under COVID-19.
In China, there are structural problems in labor supply – high quality talents with high skills are difficult to obtain due to the fierce competition. By convention, Chinese employees choose to quit jobs before the Chinese Lunar New Year and look for new job opportunities after the holiday.
However, the COVID-19 outbreak right before the holiday unexpectedly disturbed the established rhythm. A lot of people found it difficult to get themselves suitable jobs after the festival. Some companies laid off their employees due to the pandemic. Given this situation, it is a good time for companies to hire outstanding talents.
Recruitment is a fundamental and important part of HR management and for the business growth of the company. The first issue a foreign-invested enterprise (FIE) may encounter after entering China is hiring suitable local employees to support its business development.
Recruitment is an important means for companies to obtain talents. If companies cannot find suitable employees over a long period, their ability to operate normally will be affected, resulting in the waste of time and money.
Naturally, recruitment serves as the foundation for HR management. If the recruitment work is not efficiently executed, it will affect all other aspects of HR management, such as employee training, compensation and benefits, performance evaluation, labor relationship, etc. In case an unqualified staff is employed, it will cost much more time and money in conducting training sessions to ensure the employee fits in the team. Therefore, recruitment can determine the success or failure of HR investment.
Generally, we divide recruitment into internal recruitment and external recruitment – internal recruitment includes post rotation, promotion, reassignment, and internal referrer, whereas external recruitment is to locate external talents through campus selection, websites, and job fairs.
An SME with a small number of employees and simple organization structure will rarely need to employ a large number of employees. Therefore, most SMEs do not have a local professional HR team to support the recruitment work. There are some concerns when they hire new employees:
Recruitment is a challenging work that imposes high standards for recruiters when done right. Below we list out the key stages of the recruitment process and summarize the required competencies and knowledge for a qualified recruiter.
To meet their integral recruitment needs, SMEs can outsource their talent acquisition to a professional recruitment service vendor like Dezan Shira & Associates. DSA can improve the SME’s market position by helping build a good employer brand identity among potential candidates. In addition, DSA has a rich recruitment experience, a specialized talent pool, good connections in different industries, provides an objective third-party judgment, and possesses the effective talent assessment tools to help SMEs obtain the most qualified candidates.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at email@example.com.
We also maintain offices assisting foreign investors in Vietnam, Indonesia, Singapore, The Philippines, Malaysia, Thailand, United States, and Italy, in addition to our practices in India and Russia and our trade research facilities along the Belt & Road Initiative.
Previous Article « The Singapore-China Fast Lane to Facilitate Business Travel: Key Features
Next Article Planning for Uncertainty: Global Staffing Solutions to Facilitate Your China Market Entry »
Dezan Shira & Associates´ brochure offers a comprehensive overview of the services provided by the firm. With its team of lawyers, tax experts, auditors and...
Doing Business in China 2020 is designed to introduce the fundamentals of investing in China. Compiled by the professionals at Dezan Shira & Associates in...
China has faced a deluge of international criticism over its treatment of foreign businesses and the perceived slow pace of market opening over the past year....
Dezan Shira & Associates helps
businesses establish, maintain,
and grow their operations.
Stay Ahead of the curve in Emerging Asia. Our subscription service offers regular regulatory updates,
including the most recent legal, tax and accounting changes that affect your business.