Student Career Preference After financial Crisis: State-Owned Enterprises v.s. Foreign-Invested Enterprises

Foreign enterprises are losing attractiveness in the talent market. Engineering students tend to work for state-owned companies after graduation, while business students, especially business under-graduates prefer foreign invested companies. Those multi-national companies shall establish employer branding strategies to attract and retain young talents, in order to supply their long-term business development in China. 

SHANGHAI, Sep. 1 /PRNewswire-Asia/ -- Sponsored by the "Global" magazine, the findings of 2010 China Student "Ideal Employer" Survey were just released recently by Universum, which conducts student and young professional Ideal employer surveys in more than 40 countries and areas around the world every year. In China, Universum surveyed students in 89 top universities from March to May this year regarding student career goals, plans after graduation, preference on companies, etc.

One of the key findings from this survey is that the foreign invested companies are not that competitive as they were before the financial crisis. Apart from their own job preferences, young student’s choices are partly influenced by the public media. Take business students as an example, apparently from 2006 to 2010, foreign enterprises not only lost war in business, but in talent market as well.

Table.1: 2006-2010 Top 10 Ideal Employer list for business students (Foreign enterprises marked with *; FE= Foreign enterprises)

In 2006 when foreign enterprises were hot, multinational conglomerates took 8 seats in the Top 10: fast moving consumer goods industry (P&G), consulting industry (McKinsey & Company/The Boston Consulting Group), Big 4 accounting firms (PwC/KPMG), and financial industry  (Citi/HSBC/Morgan Stanley) lead the Ideal Employer list. However in 2010, only two foreign banks and FMCG giant P&G survived in the top 10. Thanks to its long-term employer branding strategy and effective campus activities, P&G maintains the leadership in the list, even though most of the foreign companies lost talents to state-owned and Chinese private companies.

More detailed insights of the business students’ choices could be found in table 2, based on their degrees (undergraduates and post-graduates) and academic achievements. Compared to post-graduates, the undergraduates prefer foreign-owned enterprises to state-owned companies, especially those high achievers, who chose 12 foreign companies in top 20 ideal employers. Those business post-graduates tend to work for CPC-governed Enterprises. Only McKinsey & Company is still attractive among top talents due to its famous elite culture.

Table.2: Top 20 Ideal Employer list for business students (by degree and academic achievements) (Foreign enterprises marked with *; FE= Foreign enterprises)

 Note:  1. More than 95% of the respondents are from China top 89 targeted universities with bachelor degree and above.

            2. High achievers among undergraduates and postgraduates are those who believe their academic marks are among top 20% in class.

If we look at the Ideal employer list for engineering students, in recent years, they prefer the IT/Communication industry, power/chemical industry, and mechanical/manufacturing industry. With China’s strategy of building the nation with science and technology coming all the way, a number of CPC-governed enterprises have shown surprising strength in attracting talents and market share. Apart from China Mobile which has firmly got its ranking in the top 10 in the past few years, the competitors for foreign enterprises have grown from private enterprises like Huawei and Haier to a massive team of enterprises with a big red "State-owned" mark.

In this fierce war for talents, Google beat both IBM and Microsoft, and even turned out to be a threat to China Mobile’s Number 1 until 2009. However, because of some turbulence that caused a serious media mass in the spring of 2010, its prospect of development in China suddenly became uncertain. The same event also made Google a bull’s eye for public criticism for its consistent propaganda of elite culture as well as its strategy toward human resources. What’s interesting is this survey happened to have been conducted from March to May this year, which accurately and promptly shows students’ reaction speed toward events like this.

Currently the top 10 list from the engineering field is like this:

• Communication industry, three enterprises: China Mobile(No.1), Huawei(No.7), China Telecom(No.8) --  Huawei is the only private company in the top 10 and their global approach and talent acquisition cannot be underestimated.
• Power industry, four enterprises: SGCC(No.2),  CGNPC(No.3), PetroChina Company(No.4), and Sinopec(No.6) -- No country would easily open its power industry to foreign competitors. Their stability and continuous development have been noted especially in a shaky economic situations like what we’re in now.
• Automotive industry, one: China FAW Group(No.8) --  the auto industry is special one in China. On one hand, most of the auto companies are joint ventures, and on the other, the corporate brand and product brand are separated. Hence, student's perceptions of the companies and car brands are not clear.
• IT industry, two: Google(No.5) and Microsoft(No.10) -- No matter what, foreign enterprises always dominate the IT industry. But, they start facing challenges from local companies.

Table3: 2006-2010 Top 10 Ideal Employer list for engineering students (Foreign enterprises marked with *; FE= Foreign enterprises)

At the end of July, 2010, Google spread the word of extending its recruitment scale. Regarding the hot issue of the ICP license of Chinese websites, Google has announced that the Chinese government has renewed their Permit for ICP operation, which means Google is still able to provide services like internet search and such to users in China mainland. To all Chinese elite in IT/Internet industry, this news has without doubt reassured their confidence in Google. Yet will those fresh graduated students react in the same way and speed to this continuously shaking employer market? Universum and < Globe > will once again show people with extraordinary insight of the changes and trends of students’ career choices.

All the data in this article is provided by Universum. For more information, please contact Nancy Tang, Email: Nancy.Tang@universumasia.com