While no official statistics exist, or Chinese government officials are unwilling to share them, sources including companies, schools, embassies and HR consulting firms all confirm the same thing: though China is increasingly important for the bottom line of international firms, Beijing is rapidly losing its charm for foreign employees.
The American Chamber of Commerce published the results of its annual ‘China Business Climate’ survey earlier in March. One question asked ‘Have you or your organisation experienced any difficulties in recruiting or retaining senior executives to work in China because of air quality issues?’ Responses from the organisation’s 365 members underline a trend, 48% replied yes in 2014 versus 34% in 2013 and 19% in 2008.
Although there is little published data, companies in many sectors report managers at all levels trying to escape the pollution. They're asking to be relocated. Last July saw an increasing number of expat families wave goodbye. Comments on online forums for Beijing parents suggest the exodus started in June.
As a result, recruiters say foreign enterprises are having increasing difficulty attracting top talent to The Middle Kingdom as many refuse to move, citing Beijing’s worsening air quality.
“Beijing has been dropping a couple of points every year as a city professionals are looking to relocate to”, said Angie Eagan, Managing director for MRCI, a recruitment firm specialised in hiring professionals in Asia.
Beijing has lost 3 points since 2012 as the preferred city to relocate to and 56% of the 5000 + people interviewed named health issues as one of the main reasons they would consider changing jobs, according to a recent survey published by the consulting company. Although a recent HSBC bank survey still ranked China as its number one location for expats, flagging high salaries.
Off the record, several international schools’ headmasters told BBC Capital that admissions fell by as much as 5% last year and separately two major embassies also said they are having trouble filling staff roles.
Parents worry about the long-term effects of exposing their children to hazardous levels of foul air, and the recent bout of pollution registered earlier this month will do nothing to reassure them. The pollution index monitoring PM2.5 particulates rose to over 500 for several consecutive days in March, more than 20 times the level recommended by the World Health Organisation, and a reminiscence of what has been dubbed as the “airpocalypse” of last year when a cloud of brownish grey dust blanketed the north of China for weeks.
A WHO survey released last year that looked at causes of deaths worldwide found outdoor air pollution contributed to 1.2 million premature deaths in China in 2010, accounting for almost 40% of the global total. When the survey was published several Chinese university professors contested the methodology and said the figure could likely be even higher.
The Chinese government has not remained inactive however. Following a wave of indignation on internet forums and social media, the new Premier, Li Keqiang, has repeatedly vowed to “fight a war on pollution” and a monitoring system has been launched in all of China’s primary cities. But despite thousands of factories forced to shut down and millions of dollars invested to upgrade China’s rundown industrial system, the skies remain grey above much of the country’s main cities and most emission-reduction targets have been missed.
Rising pollution has been a concern for the expatriate families drawn to Beijing by plump compensation packages and job opportunities. However it’s only in the last 18 months that companies have really seen an effect on headcount as families come to terms with the realisation there is no quick fix to cleaning the air.
“People are surprised the pollution is continuing and have come to realise it’s not a momentary issue”, said Adam Dunnett, Secretary General of the European Chamber of Commerce in China.
“I got back to Beijing after our Summer holiday last year and thought, ‘what am I doing here?’” recalls Alison Thompson who had moved to the Chinese capital in 2003. The mother of two and former kindergarten teacher in Beijing has relocated to Tokyo, Japan, where her husband, consultant for an international oil and gas firm asked to be moved. Given the air quality, has not replaced him in Beijing.
“It’s hard to find a manager for Beijing today. It’s become a real challenge”, said Angie Eagan, adding senior staff are more often looking to Hong Kong or Singapore as their preferred destinations in Asia.
Nonetheless, Beijing remains the political and economic center of the world’s second-largest economy and many foreign companies have invested millions of dollars to incorporate their China and Asia operations there.
Some of these companies have taken radical measures. Some offer higher compensation or flexible packages such as paying weekly plane tickets for their executives to see their families settled elsewhere in Asia.
Many are installing sophisticated air filtering systems in the work place and offering to pay for air filters for their employees’ homes. Compulsory masks are offered, as well as information campaigns on health risks of pollution.
“Companies are doing what they can, but the reality is that people are leaving … And it’s becoming difficult to attract people”, said Adam Dunnett.
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