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HR: The Squeezed Middle or the 100-per-center?
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The Squeezed Middle or the 100-per-center?

By  Robert Parkinson (CEO & Founder of RMG)


BT 201601 100 47 HR 001Economists and advisers I know well have said to me that a realistic guesstimate for China's GDP this year is 0-1%. In other words approaching recession. There's really nothing that's 'new normal' about that. Whether or not this is actually accurate, it's certainly true to say, based on anecdotal evidence of conversations from the last four months that there has been significant slowdown in the economy after the stock-market turmoil of the summer.


So, as a specialist in Human Resources, with 10 years work experience in China, I am often asked what this means for the employment market for those who - for whatever reason - are actively looking for a new job, and what does this mean for passive candidates (not actively looking for a new job) who might still be in demand in the jobs market. Indeed we often talk about this on RMG's weekly slot on China Radio International 'Career Builder'.



So, here are my conclusions about the current situation:


- Let me introduce 'The Squeezed Middle'. The squeezed middle is, what I would term mid-producing staff who are partly business critical, and, importantly who have compensation packages which have been over-negotiated. For example, a person who works in the finance management function of a company, who came from a competitor, and is above the market average for their position in terms of compensation, and achieves 50-70% of what they are capable of would be what I would term someone who is the 'squeezed middle'. They are semi-business critical, in that they occupy an important function of your business, and they bring great market knowledge [from the competitor] but they are not people who generate revenue for your company in either a marketing or a sales capacity. I have witnessed the salary expectations of the squeezed middle rise vastly out of proportion to, for example marketing functions throughout my career working in China, and at each economic hurdle (for example after the Lehman Crash of 2008) it is the squeezed middle who are the first to suffer in cost-cutting rounds, and then the squeezed middle that retaliates with increase-demands of 'my expectations are a 30% increase' (where's the logic) when the market comes back.


- Secondly, in contrast to the squeezed middle, the opposite effect happens with another group I call the '100-percent-ers'. The 100-percent-ers are those people who are 100% critical to the revenues of the business. They are often passive candidates who require approaching directly. Examples are of course obvious. We are talking about people who sell successfully (I say successfully as, although a cliche, it's a fairly consistent observation that only 20% of an organisation's staff engaged with client-facing activities are actually successful), or if a marketing-driven business have a demonstrable record, etc. These 20% highly-effective 100%-percent-ers are the people that bring the money in, so in fact in a difficult market I see very consistently a rise in demand for 100-percent-ers. Why? Well in business you really have only two choices: You can either cut your costs or increase your revenue. Cost cutting is a finite activity. There is only so much to be cut, whereas increasing sales is infinite.


BT 201601 100 46 HR Human ResourcesIn 17 years working in Human Resources I have worked in the UK (I'm a Brit), the Netherlands, Belgium, the USA and China (10 years). In every place I have worked I have observed a similar pattern, the only exception being the fair-weather salary increases demanded in China. When the economy catches a cold, some companies get the flu, whilst others (who tend to do what I've just described and hire the 100-percent-ers) boost their immunity. Indeed in the last 4 months RMG has seen an increase in demand for client-facing talent throughout China.


RMG Selection specialises in recruiting high-quality professional Chinese and International candidates in the following disciplines and sectors: Sales, Marketing, General Management, Legal, Finance & Accountancy, Human Resources, Information Technology, Logistics, Healthcare, Pharmaceuticals, Automotive & Machinery, General Manufacturing, Internet.


I wish you a great January and I look forward to speaking to you.


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