Chinese Industry Finds Talent Scarce


Chinas huge population does not guarantee a huge talent pool. As a nation in which only about 12 percent of the population has a college degree and above, according to government statistics, companies across a variety of industries increasingly find talent recruitment difficult. Lube companies are no exception.

Foreign lube companies usually prefer English-speaking candidates with great knowledge of lubricant products and sometimes marketing, depending on the positions, but its very difficult to find such candidates, said Yang Zhaoping, sales director for automotive lubes at Russian oil giant Lukoil, which recently entered China.

Because of the scarcity of such candidates, foreign companies invest a lot to train new hires, said Yang, who has extensive experiences in multinational lube companies. He noted that the fast pace at which Chinas lube industry is developing exacerbates the shortage of sales talent with solid product knowledge, as well as of senior managers.

As a late comer in China, Lukoil even faces more pressure as it seeks talent to help with business development. But we dont have any shortcuts for talent hires, so we have to follow the pattern, Yang said.

Yangs concern is not shared by Liu Junyi, vice general manager at Luan Group, the state-owned coal mining company that also produces coal-based synthetic base stocks.

In China, state-owned companies equal stability. People want stable jobs, Liu said. He added there is nearly zero staff turnover during contract periods in the company.

In recent years, under Chinese President Xi Jinpings call to make state-owned companies strong and big, China eased salary restrictions at state-owned companies.

Salary used to be a big hindrance for state-owned companies hiring talent. But now, we can offer him the same, or even better, package than he had at multinationals, he said.

Swedish human resources consultant Universum conducted a survey last year of college graduates born after 1995. According to the results, only 14 percent of science majors and only 16 percent of engineering majors – the two majors most sought by lube companies – preferred working for foreign companies rather than domestic. Those numbers represented a drop from about 25 percent in 2016.

In 2017, CNPC, Sinopec and China National Offshore Oil Co., all state-owned, were the only three companies with lube businesses rated among the top 10 desired employers, according to Universum.

Industry-wise, though, the entire oil industry was much less popular compared with information technology and finance.

Zhang Chenhui, a lube industry veteran who spent most of his career at Sinopec before retirement, said it is indeed difficult for the lube industry to attract young people, who usually prefer glamorous jobs in sleek buildings in big cities.

Its not only in China, but also in developed countries like the U.S. Lube companies often are located in rural areas to focus on research, or require sales people to travel in rural places to build sales networks, which is not fun for young people, he said.

Luan apparently felt the same way.

So, we put our research center in Shanghai, Liu said.

The lack of interest from younger workers is also noticed by Zeng Qingde, president of Foshan, Guangdong province-based blender Breda. He said most of the people he knows in the industry are over 30 years old.

Running small and medium-sized private companies has never been easy in China, as they have to struggle to survive between resourceful and financially secure state-owned companies and multinationals. Zeng said the only advantage for private small to medium enterprises is flexibility, which allows quick changes to catch the latest market trend.

For example, Breda in early 2017 changed the company image from selling lubes to an aftercare service provider for automobile engines and transmissions. So far, it has about 800 service stores in south China, thanks to franchising. A rapid expansion demands efficient store managers.

You cannot imagine how difficult it is to find someone who knows lubes and is experienced in management, Zeng said. Therefore, when he finds one, he will give that person stock benefit plans.

This will give store managers a sense of ownership, making them Bredas partners rather than employees, Zeng said.

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