As visa requirements tighten, employers and headhunters speak out about foreign graduate’s labor market.

What is the reality for foreign graduates facing the labor market, and how do employers deal with the changing situation?

If we just look at public data, the number of foreign students in China keeps increasing each year. For example, in 2015, there were 20581 more compared with 377,054 in 2014, an increase of 5.46%. Meanwhile, the number who can get work permits is decreasing. According to the official statistics issued by the Ministry of Human Resources and Social Security of the People’s Republic of China, the number of foreigners who hold Alien Employment Permits to work in China keeps declining in the last few years, ranging from 240,000 in 2015 to around 246,400 in 2012.

Perhaps this has a negligible impact on the public, but it makes one wonder whether it is really hard for foreign graduates to get a job, or for them to find a satisfactory employer.

We interviewed experts, employers and headhunters who aim to provide foreign talent for local companies. Their feedback and feelings seem polarized regarding the different challenges they are faced with.

1, “We just can’t offer enough qualified candidates for SMEs”

Shang Weidong, a senior headhunter from Jobsite China, whose main clients focus on screening qualified foreign talents for small and medium private enterprises, pointed out that the number of foreigners who could successfully work in China declined by 60 to 70 percent, even by conservative estimates.

However, companies' demand for such talent hasn't shrunk obviously. The main types of positions offered to foreigners include: foreign staff to explore the targeted country's market for foreign trade companies, accounting for 20% among all their clients; positions like graphic designers and 3D designers account for 20%; the largest sector is marketing positions, accounting for around 30% to 40 %; the rest include positions like media, translation and foreign language teaching, only accounting for around 10%.

The gap between supply and demand has caused difficulties for headhunters like Shang, who look for foreign talent for enterprises.

Shang concludes three factors have led to the dilemma: first, the tightening policies for issuing work permits; secondly, the specific regulation of issuing working permit, that the positions offered for foreign staffs should not displace local workers, which gives local authorities greater leeway for not issuing an individual's work permit. Thirdly, the environmental degradation and economic downturn in China also affect foreign graduates’ motivation to stay.

There are five fundamental steps for getting a Z visa for foreigners, the most crucial part is getting a work permit, and the key requirements include: Final degree (bachelor or above); work experience (at least two years) ; Certificate of no criminal conviction.

For most foreign graduates in China, the condition of two years’ work experience is the toughest to meet.

2, Tightening visas in recent years

Andrea Zhou, Associate Director of Student Development, the Beijing Centre for Chinese Studies in UIBE, whose main responsibility is managing the daily life of US students studying at the university, said that the number of American students who choose to stay in China after graduation has declined sharply in recent years, with many losing the motivation to stay here, particularly those who came around 2008 and 2009.

She further explains that, to be exact, it’s the regularization of the visa application procedure and the clear classification of different visas that reduced the number of visas granted, hence forcing employers to be more cautious when hiring foreign students, which is actually a good thing concerning the standardization of the foreign talent labor market.

Around ten years ago, it was very rare for foreign graduates to hold a Z visa to work in China, because at that time, both employers and employees could hardly meet the conditions: on the one hand, very limited enterprises had the ability to help foreigners get Z visas; on the other hand, few foreign graduates’ could meet the requirements for getting Z visas. So the number of foreigners who held tourist visas or even illegal visas to work here was greater.

However, in recent years, with the tightening regulation and greater attention paid to this issue, more and more companies realized that they should just follow the rules and process the legal procedures to get visas for foreign employees, if all their conditions meet the requirement, it’s no big deal to get the Z visas. Correspondingly, it squeezes out those who held illegal visas to work here, which makes this market smaller.

She expressed that, in her opinion, this is a good thing for foreign graduates. If you meet all the conditions, you stay; if you can't meet the conditions, you just leave, and as long as you can stay successfully, all your legal rights would be more firmly protected, and the most important thing is, you get paid much more than most of your Chinese colleagues.

3, “Attracting higher caliber talents may be the strategy of the government”

Li Yong, deputy director of the career service center in UIBE, said that the reason for the new policy is the government's strategy to attract more highly talented professionals from foreign countries.

This point is also mentioned by other employers from the petroleum industry, that if the policy opens up for all foreigners, especially for those positions with lower requirement, it would definitely increase the difficulty for local graduates to compete in the labor market. While attracting foreign talent, especially in bottleneck industries, would mean a lot for increasing talent in China.

This makes the two years’ work experience requirement more reasonable, and other employers also emphasized the importance of work experience in an employee's development. For this aspect, the requirement did fit some employers’ demand: “We’re usually looking for more sophisticated foreign employees that can bring qualities and skills which we lack, and this must be practical and proved through his previous experience. These foreign employees get much higher salaries than local employees, so it’s natural that employers demand more mature, experienced people when considering foreign graduates.” An anonymous HR manager from a private enterprise in the clothing industry commented on the policy.

4, “It should be decided by employers themselves”

Liu Huizhong, the senior consultant from a foreign HR company, who is very experienced in helping foreigners find jobs in China, said that according to the cases they’ve already managed, around 30% of foreign job seekers are new graduates, and their countries of origin include Southeast Asian countries (70%), American and European countries (20%), and African countries (10%). The new graduates did have a much lower chance to get work permits issued by the government. “The problem is still about the two year work experience,” he said.

Liu summarized that, in the end, the decision of what kind of foreign staff with what qualification should be made by the employers themselves. This is because employers are the actual stakeholders who deal with these foreign employees every day, so if they believe two years’ work experience would not have much influence on the staff's professional skills, why would the government pose unnecessary challenges for these companies’ development?

He also mentioned the need to be more coherent and consistent, considering different local authorities actually have different standards. “There was a case in which a foreigner who had successfully applied for a work permit issued by Shenzhen’s Public security bureau, had to apply for it again when he traveled to Beijing. This time, he couldn’t get the Alien Employment Permit issued by Beijing’s Public security bureau. All his qualifications had not changed at all, so why could it be done there but not here?"

5, “Policies may become more welcoming in the next few years”

Chen Zhiming, China Daily’s international staff office director, is much more optimistic about the future.

“Despite language skills and the Z visa, the considerations behind hiring a foreign staff are no different than hiring a local staff. From an employer’s standpoint, the most important problem would still be whether he’s good enough to fit the position, for example whether his academic background, personality, and whether he has solid, related work experience.”

The initial purpose for formulating a stricter policy is to better regulate the foreigner labor market, not to increase the burden for employers or foreign graduates, Chen said. From his previous experiences of dealing with the government when applying for Z visas for foreign staff, the authority is very reasonable, even when you have special cases and need their help. If more and more excellent foreign graduates have intense motivation to work in China and corporations have urgent demand for these foreign graduates, the petitions from these groups may attract the authority’s attention to formulate a more comprehensive policy to keep these excellent talents in China.

“I can sense that the policy is gradually opening up,” Chen added, “while at the current stage, foreign graduates who can successfully stay are the ones who have already had two years’ work experience in their countries of origin or other countries, and they obtained the degree in Chinese universities. We recruited a foreign student from Tsinghua University, and when we applied for a visa for him, we didn’t face any difficulties.”