China Sees End to 50% Salary Increases

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Tier One Executive Search (Detroit, Canada, Shanghai) cites market maturity as major driver in compensation stabilization in the Peoples Republic of China.

Tier One Executive Search reports a "leveling off" of salary increases in the China manufacturing market. "Gone are the days of candidates doubling and tripling salaries by jumping ship to go to new organizations," says Mark Thibodeau, Senior Partner with the Detroit based executive search firm. Tier One has placed more automotive industry leadership professionals in mainland China than has any other western firm.

This phenomenon of triple digit salary growth was mostly within the foreign entity manufacturing base, but also bled into the Chinese owned segment. Thibodeau went on to say, "Back in 1999 and even up to 2006, there were a lot of candidates out there who simply did not know his or her own worth with respect to the market - it was commonplace for someone with extremely marketable skills to go from the equivalent of $40,000 USD per year to over $100,000 simply by changing organizations." He attributes that to some industry trends which caused the market to explode. One of those trends was within the automotive industry, which was moving to a global vehicle platform. Some of the manufacturers were mandating that their suppliers demonstrate manufacturing capability in China by a certain date. This caused wide spread expansion in the China parts manufacturing sector. The salary levels have since caught up to the market and have thereby stabilized.

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Mark Thibodeau, Senior Partner
@TierOneSearch
since: 03/2014
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