Salary increases for expats in China to hit double-digit figures

<p>Salary increases among local and senior expatriate advertising </p><p>professionals in China could hit double-digit figures this year, </p><p>according to agencies, an executive recruitment firm and an executive </p><p>research consultancy. </p><p><BR><BR> </p><p>Figures provided by TMP Worldwide eResourcing showed that estimated </p><p>salary packages are up between 10 and 50 per cent for expatriates </p><p>compared with last year. </p><p><BR><BR> </p><p>The biggest rise has been for the MDs, up about 50 per cent at the top </p><p>level to USdollars 300,000 annually plus housing. </p><p><BR><BR> </p><p>At the same time, Watson Wyatt predicted salaries for locals would rise </p><p>in the region of 10 per cent, although instances of 30 to 40 per cent </p><p>hikes have not been uncommon. </p><p><BR><BR> </p><p>Agency heads said that while there was a large local talent pool in </p><p>China, locals were not sufficiently experienced to take on senior </p><p>positions resulting in the need for expensive expatriates. </p><p><BR><BR> </p><p>The situation was worsened because of rising housing costs, especially </p><p>in Shanghai. </p><p><BR><BR> </p><p>Leo Burnett regional managing director Richard Pinder said that at his </p><p>agency, about 75 per cent of managers in each of the major Asian markets </p><p>it operates in is made up of locals but that in China the skew was </p><p>towards expatriates. He believed that it would be some time before </p><p>locals filled upper echelon positions. </p><p><BR><BR> </p><p>"We are another set of managers away from appointing local MDs. I think </p><p>it would be three to five years rather than one to three years," he told </p><p>MEDIA. </p><p><BR><BR> </p><p>However, there was also concern that local professionals have been </p><p>asking for more than agencies were willing to pay. </p><p><BR><BR> </p><p>DDB Greater China president and CEO Aaron Lau said that there have been </p><p>cases where salaries have risen by 30 per cent, "which the industry </p><p>might not have a problem with if they are for top talents but the </p><p>problem comes when less skilled and experienced people start demanding </p><p>the same". </p><p><BR><BR> </p><p>Grey China chairman and CEO Viveca Chan agreed, saying that when </p><p>agencies are forced into paying lesser talents more than the market rate </p><p>and promoting them faster, the gap between job duty and ability </p><p>widens. </p><p><BR><BR> </p><p>Nevertheless, the disparity in pay between locals and expatriates in </p><p>China appears to be narrowing, according to a report by Watson </p><p>Wyatt. </p><p><BR><BR> </p><p>For instance, a local creative director in Shanghai could expect an </p><p>annual salary of HKdollars 400,000 (about USdollars 51,000). </p><p><BR><BR> </p><p>The figures for Hong Kong, Western and Asian expatriates in the same </p><p>position are HKdollars 840,000, HKdollars 939,484 and HKdollars 728,074 </p><p>respectively. </p><p><BR><BR> </p><p>However, most of the locals who command top-dollar pay packets have been </p><p>trained by MNC agencies and "those who have been trained are </p><p>understanding their true worth and potential", said D'Arcy president and </p><p>regional CEO Garry Titterton. </p><p><BR><BR> </p><p>One of the more recent trends has been for multinational-trained locals </p><p>to set up their own shop, which could derail the efforts of agency </p><p>networks in growing their local client base. </p><p><BR><BR> </p><p>FCB Greater China chairman and CEO Gary Tse said: "It could be a major </p><p>threat to us because local clients increasingly understand the value of </p><p>branding and advertising but a significant number are unwilling to pay </p><p>MNC rates. But I see the emergence of local shops as a good thing </p><p>because competition will make us better and overall industry standards </p><p>will continue to rise." </p><p><BR><BR> </p>