Competition for human resources between China’s second-tier cities is intensifying, with the launch of new policies designed to attract and retain skilled residents.
Since the start of May alone local governments around China have unveiled a raft of new human resource policies, including Hainan in the far south, Hohhot in Inner Mongolia, the Jiangxi province capital of Nanchang and the northern Chinese city of Tianjin.
Tianjin municipality unveiled its “Haihe Yingcai” (海河英才) plan on 16 May, which greatly reduced the threshold for skilled personnel to obtain residence in the city.
Under the plan holders of bachelor’s degrees under the age of 40, master’s degrees under the age of 45 and Phd holders of any age can directly apply for local household registration as long as they have identification and their diplomas.
Official data indicates that around 300,000 people applied for residence online during the period from12:30 in the afternoon on the date that the plan was announced until 8:30 a.m. the following morning.
The competition between Chinese cities for talent first began to heat up last year when the Hubei province capital of Wuhan first launched a plan to settle a million university graduates within five years.
Other Chinese cities quickly followed suit with policies that provided housing subsidies, household registration and other preferential conditions in order to attract new talent.
The Sichuan province capital of Chengdu announced that it would provide household registration to university graduates as well as greater ease of access to apartments, while the Shaanxi province capital of Xi’an allowed graduates to apply for household registration online, and the Liaoning province capital of Shenyang has offered home subsidies to skilled personnel.
The policies appear to be paying off, with the “2018 First Quarter Human Resource Attractiveness Report” (2018一季度人才吸引力报告) released by BOSS Zhipin indicating that 15 “new first-tier cities” launched policies to attract talent last year, including Chengdu, Hangzhou, Nanjing, Wuhan and Xi’an.
In the first quarter of 2018 the “talent in-flow rates” (skilled personnel inflow/ skilled personnel outflow) of new first-tier cities was 1.07, for a rise of 3.2% compared to 2016.
The percentage of professionals who pursued employment in new first-tier cities after graduating in the same location rose to 73.8%, for a rise of nearly 20 percentage points compared to 2016.
The “Best Quality Household Settlement Policy” (最优落户政策) launched by Xi’an earlier this year helped to attract around 300,000 new residents by 16 April, while Wuhan settled over 120,000 university graduates in 2017, around six-fold the number in 2016.
During the period from July 2017 to March 2018, Chengdu attracted over 155,000 recent university graduates, of which 43,000 were from rural areas.
Analysts point out, however, that irrespective of the human talent policies launched by local governments, the key factor determining the appeal of city to skilled personnel is the presence of strong industrial and economic conditions.
Few second-tier Chinese cities possess these conditions aside from the Zhejiang province capital of Hangzhou, which is host to a slew of leading tech and emerging sector enterprises, chief amongst them Alibaba and Ant Financial.
According to the “2017 Personnel Competition and Professional Mobility Big Data Report (2017年人岗争夺战及职场流动力大数据报告) Hangzhou’s net talent in-flow rate (skilled personnel inflow/ total change in skilled personnel numbers) in the first half of 2017 was 11.21% far and away the highest in China.
Xiamen University economics professor Ding Changfa (丁长发) said to Yicai that it had taken many years for Hangzhou to establish itself as a hub for the information economy, eventually resulting in a large inflow of human talent.
According to Ding some second-tier Chinese cities have seen only weak development in their emerging sector economies, and that it will take a number of years for them to remedy shortcomings via the launch of various measures such as encouraging entrepreneurship.
“You can’t just look at current profits…you need to really reduce the cost of industrial development,” said Ding.”