China's Brain Drain

All the chinese I know or have met in the US and Europe miss their families and some aspects of home (the neighborhood, friends, favorite foods) but they love the much more comfortable lifestyle, the convenience, a lack of fear about discussing certain topics (coming from China and watching western commentators and reporters fry local and national politicians and businesspeople has a certain effect) and most of all, good health.

Chinese people go back to china to visit for a period of time and spend twice that amount of time recovering when they come back to their new life. Some even say the food doesn't taste as good. The longer Chinese people stay in the West, the harder it is for them to go back.

A saying I've heard from chinese people "If you want to be rich, go back to China, if you want to be free and healthy, stay in the West".

China is the reason for China's brain drain.

I think the issue is not 2/3 of them are not returning but the percentage of them returning year on year. All articles on American brain drains cited decreasing Chinese student enrollments in US university and increasing of Chinese graduates returning.

Hmm... If American and China are both experiencing brain drain, we need to see if there is a brain black hole somewhere in the Pacific. ;)

nanheyangrouchuan --

I have heard the same things of which you speak, yet I have also heard from many Chinese eager to return to the excitement of China. Many choose to stay in the U.S. because salaries are so much higher here. You are right about the health issues, but that is true of many of the world's great cities and yet they continue to attract large numbers.

Mr. Li --

I do not think the U.S. is experiencing a brain drain, but since I just gave you the award of best read reader, I am guessing you have read something on this somewhere.

As far as I know, you omit to mention that most Chinese mainlanders see Chinese who have been studying abroad with suspicion: they got the "banana syndrome" (yellow outside, white inside). Except if you set up your own company or you have been in the Ivy league, the prospect is gloom for Chinese wishing to go home; so, they prefer to stay abroad.

Monsieur Guerel --

Good point. Very good point. Same holds true for those who return to Vietnam and even to Korea.

I think a new trend reinforcing the "brain drain" idea is that Chinese managers who have been successful in western or multinational companies don't really have that much of a practical advantage in traditional Chinese organizations anymore. It's a different skill-set, and the gap seems to be widening. When China Inc. was stuck in neutral, these know-it-all twenty-somethings were necessary evils. Now that the Chinese Economic Machine is firing on all cylinders, they are getting a cooler reception.

BTW -- BBC is still blocked in China, so next time could you give a few more details or quotes from their articles. Thanks.

Andrew--

Thanks for checking in and for making some great points re changes in management in China.

Sorry about not providing more on the article, but it was one of those that one really needs to read to appreciate and could hardly be summarized. If you would like, I can e-mail it to you via cutting and pasting.

Well, the brain drain thing has been annual theater in Congress for more then 10 years every time H-1 Visa quota up for renewal. The pro-business Republicans will be floating the brain drain theory to support increasing quota and Democrat will do the stealing American jobs bit. And they will just vote to increase the quota. It would be interesting to see this year when H-1 quota is up for renewal, probably in May now there is a Democrat Congress. ;)

By the way, when I got my H-1 in 1997, the #1 applicant of H-1 was not IT. It's model agency! H-1 for Swedish babes! ;)

Many of the chinese students who come back to China do so because they cannot find jobs in the US (or the West in general). Some get very nice job offers, especially from provincial governments, but that is rare. Studying and working abroad now has another stigma beyond being a "banana" and that is the Chinese who do return like to flout their experience that supposedly makes them "clearly superior" to local candidates while people who never left point at the returnees as simply "arrogant" and no longer "real chinese".

Also, returnees without significant work experience are not really in demand, as most chinese now know that returnees who just graduated from a western school spent most of their time in the dormitory studying or online, so they have no genuine "experience".

Here's a situation you all will find interesting. The US is trying to fill the ranks in certain skilled white collar sectors by offering "fasttracks" to green cards if you are a foreigner who gets a job specific degree and works in that field in the US for a certain period of time. Physical therapy, IT, biostatistics and nursing are two such fields and chinese wanting to come to the US are very aware of this. Schools demand that all of these foreign students come to get a PhD, but companies pick them up quickly as soon as they get a master's and INS doesn't care, so chinese students sign up for PhD programs and jump ship with a masters, starting at upper 5 figure salaries on average.

And I am speaking from first hand knowledge.

Another reason to stay abroad is that in general you can earn much more here and send more money back to your parents. Ranks of senior and upper management in China are crippled by a lack of talent, but you have to be middle or senior mgmt somewhere else to get there. So Chinese students stay in the US, make decent money, send money home, raise their kids in a healthy environment and visit whenever they want.

Many chinese students studying here, after getting their degree and job, grab their high school or undergrad sweetheart and bring them to the US to marry.

Like I said, china is the main reason for china's brain drain.

H1-Bs are a handy weapon to create a downward pressure on wages under the cover of a "qualified worker shortage". H1-Bs keep their mouths shut about too many hours and too little pay, even in skilled positions, while us uppity citizens and green card holders are left out in the cold because of our demands for market-oriented pay packages and not working 12 hours on the weekend just because the boss says so.

R:

If the UK was selling job opportunities instead of just a high priced education, you'd have more takers.

Mr. Li --

Yes, but brain drain implies top people are leaving the U.S. rather than that we have a shortage in the first place.

I suspect nanheyangrouchan has a point. The courses are relatively expensive especially in Economics (although still a lot cheaper than the US). However, at the right University the quality of the education is very high and provides the student with the qualification to go into many different fields - this is why the student must be careful where they study and one reason for the China Economics Blog. Economically speaking I suspect the answer is that the returns to education have fallen. The sheer number of students with MSc in Economics and Business (MBA's etc.) related courses is so high that the wage premium to such a qualification has fallen. Moreover, the quality of Chinese Economics and Business education is improving dramatically as UK and US trained PhD students return to Chinese Unviersities. Against this is the rise of the middle class in China which means that each year more and more students can afford to travel abroad for an education. The final point is that there may be an immigraton issue as you allude to. I will be posting on this but there are moves to allow any Chinese (or overseas student) with a PhD to have an automatic 5 year work visa. Similar moves may be possible at the postgraduate level. The UK has every incentive to attract the top students from China.

As a student of Chinese, I have encountered many American students who want to live and work in China to get an in on the huge economic development there. (This can often be frustrating, when students seem more interetsed in making money than in learning about the Chinese culture. But I digress.) Why is it, do you think, that so many foreigners see China as a very lucrative opportunity, while so many Chinese natives chose to seek employment elsewhere?

It seems like the many Western companies that operate in China would be thrilled to have workers with a Western education but who are culturally Chinese and could fit in better locally, and would be willing to offer them good jobs with Western salaries. Why do you think more foreign educated Chinese are not taking advantage of these opportunities and chose to remain overseas?

nanheyangrouchuan --

Makes sense.

Foreign companies on recruiting tours rarely bother with anything less then the top ten schools in China and now they are demanding work experience (even if it is waiting tables) on top of the degree...even advanced degrees plus work experience. They can do this because there are far more degree holders than positions. Why is this? Becuase Beijing extended the "build it and they will come" idea to "turn out masses of engineers, accoutants and business students" and basically China would be THE outsourcing place for the entire world. But quantity is not quality, entrance scores for top schools were lowered drastically and kids are pushed in and out the door.

Westerners come to china and stay there hoping to get rich either because they don't or don't want to know how things actually work (or do stay, get to know things and just complain because for various reasons CANNOT return home). Which is why the vast majority of foreigners in China with substantial wealth are being paid by foreign companies and not entrpreneurs or teachers (there are exceptions but this is not the rule).

Heck, good chinese medicine doctors go abroad and make good dough. Why stay?

"Why is China so hot for we foreigners but not for the Chinese?"

I think the observation is a bit distorted by the representatives of the group of "foreigners" and "Chinese." Most of foreigners interested in China are either those who are fascinated by Chinese culture or those who are attracted to China because of the economic opportunities. China has always been hot for the first group. For the discussion here, we are really talking about the second group.

So, what does China have which is so attractive to foreigners? First of all, its path of economic development has been incredibly open comparing to the rise of Japan, Korea and Taiwan. Even though the economies were exported oriented for all but China's export engines were mainly driven by MNCs instead of domestic companies. Wal-Mart alone is probably responsible for 2~3% of Chinese GDP.

As China developed into second stage with the expansion of domestic markets and the rise of locals into the management ranks, a lot of MNCs started to replace expats with locals in all levels. Some expats just went home when companies call but quite a few of entrepreneurial ones decided to stay in China to start their own business. A lot of them got into "Chinese entry consultants" or "Chinese sourcing agents" targeting at smaller companies then their previous employers back home. This makes China hot, not just for MNCs but SMEs fueled by both outsourcing and "1 billions customers."

This development path of China is very different from Japan in which development were driven by domestic firms with low level FDIs. Many foreigners finally get to participate in Japanese market in late 90s after the country is 10 years in recessions loosing the grab of Zaibatsu on the domestic markets. West financial, retailers and hotel chains only started to have their impacts on Japan in early 2000s. Korea and Taiwan had similar stories.

Also, I think Shanghai plays a vital roles in retaining the entrepreneurial expats to give up their MNCs jobs to stay here. It's simply very easy place for foreigners to build a new home. Well, not surprisingly, it's a city built by foreigners to begin with. Look at the profiles of hot Chinese cities, they all have similar profiles except Beijing. Dalian was built by Russian, Qingdao had strong German influence, Shenzhen was practically built up by FDIs. The cultures in these cities are very open to foreigners and more or less helped by China's already diverse cultures. It is not difficult for a blonde hair and green eyes laowai to feel blend in. It's hard to get same feeling in other countries around Asia.

Here is my blend in test. Pick a local restaurant and go in a pair of white guy and yellow guy and have the white guy do all the ordering in the local languages. In Japan, the waiters will always look at the yellow one for the sign of confirmation regardless to whether the yellow one speaks the language or not. In China, the waiters will usually look at the one who's talking even the Chinese is broken. I think small things like this actually play a big factor for the comfort level of an expat and contribute to the hot feeling of China. It's simply not hard for any foreigner who has visited China to ponder about explore opportunities here.

I think the same level of comfort can be evident in the blogsphere by foreigner in Japan and China. Most of foreign blogs from Japan are still written in an in-passionately by stander view point sounded like "well, that's ridiculous but that's Japanese way" but a lot of foreign blogs from China are emotional from a point of view of "Hey, I live here too!"

With enough foreigners passionate about China and the fact each one of us only gets 24 hours a day, it's hard not to feel China is very hot for foreigners, even though the actual percentage of foreigners interested in China is low.

As for Chinese not feeling China as hot, I think it's easy to explain. Chinese go over see to get a better education and seek for better lives and lives in developed countries are definitely better then back home. Most Chinese went oversea for post-graduate degrees in engineering and sciences and that along would most likely to land them in stable career paths. Most of Chinese in the West are in the R&D departments instead of management/sales/marketing. Most MNCs' available positions in China are in management, sales and marketing. Few positions in China are available in MNCs for them. The main reason for Chinese to return to China is for those who are hitting glass ceiling in corporate American in their attempt to move their careers from R&D into management. Many return to China to start their own business had experience of companies refusing them to switch to management and wanting them to stay in engineering. Starting one's own business is a risk few would like to take and that's why it seems Chinese in the West isn't that interested in China because opportunities are not better back home.

Overall, I think if we took a survey of white collars workers in the US asking about going to China, I think we would get about the same percentage of white and Chinese to say they want to go. China is hot for those with entrepreneurial spirit and those are few in either demographics.

Kind of getting to this after spending a day in Yasukuni Shrine in Tokyo with a French buddy living in Japan. It always puzzles me that why the West can't get why Asians are emotional about the issue. I think one key reason is few foreigners actually get emotional over any Japanese issue because the country always make any foreigner feeling like an outsider. China doesn't make foreigners feel the same.

I lived in China and Japan. My Japanese was way better than my Chinese when I got there but I studied at Tsinghua as an exchange student so that gave me a cachet perhaps.

I think the Japanese are friendly, but there are certain Japanese people who want to meet foreigners. There are however Japanese who resent foreigners and there are of course places that do not allow foreigners, fancy clubs and what not.

In China people are eager to talk to foreigners in Chinese. In Japan random strangers would want to practice their English on you. In China I talked to working class people in post offices, on trains, etc. Our conversations were limited but as long as their was no haggling involved people treated me kind. I think the country you are from matters. I'm a Canadian and that went over well. Many countries I've visited in Europe treated Canadians kinder than Americans.

I know how hard it is for a foreigner to become a Japanese citizen even if one were to take a Japanese spouse, I'm less familiar with this problem in China. I know inter-racial couples that involve Chinese Canadians and non-Chinese Canadians but they aren't seeking Chinese citizenship. I think there is still a newness to foreigners in China, and that if you are willing to be open minded and learn as well as teach people will treat you well.

That said the Chinese are not fans of say the Japanese. I met a few while there as well as some students studying Japanese. Many Koreans were in Beijing studying. I think where you go in both countries is an issue, some places are more friendly, some places a foreigner is more novel, some places such as Okinawa in Japan have had a series of incidents involving US Military personnel for instances.

It is dangerous to generalize, and I'm not sure how much my rambling comment helps. I think I may have made more friends in China than I did while in Japan, but 'friend' is relative and trust should be a two way street.

Dear sir
i just wanna know in china if some body need a working visa then he must registerd 2 years old company in hong kong.waiting for reply
thanks

I think the people are reality. since china is a developing country, the government and the companies can not provide what the talents want. everyone is living for their life. they are looking for a place where they can develop well.