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Q: Expat vs. Chinese salaries?
Chinese folks are always asking me about how much I make...
On average, how much more do expats make for job positions as opposed to Chinese in China?
Does it differ by profession or is it pretty standard across the board?
For the long term expats/Chinese users, has the gap increased or decreased in recent years?
Are there any official statistics on this kind of thing?
11 years 12 weeks ago in Business & Jobs - China
It is very difficult to say for sure that expats do, in fact, make more money than many Chinese. While expats base salary may be higher, I think grey money means that many Chinese actually earn substantially more than expats.
I am constantly surprised by the number of seemingly low paid workers that can buy apartments and cars, that appear to be way beyond their reach.
To me it looks as if the expat market is shrinking. The foreign companies in China are more and more using local manpower for positions that would have been expat only territory 10 years ago. The trend among the people I talk to is that there are less and less "folks from back home" in their companies. For this reason the difference is getting less, and as Traveler notes, foreigners do not possess guangxi to get access to the grey money.
Teaching is probably an industry all for itself. I don't think even a Chinese person with perfect Oxford English will come close to a "proper" white person from Oxford (or thereabouts)
Traveler:
Agreed about the expat market shrinking, and China is actually passing laws to hasten this. As example, the big four accounting firms have been told that they must employee 80% Chinese citizens by 2017. Additionally, all senior partners in the firms must be Chinese citizens.
This has the big four very nervous about their credibility, given that Chinese legislation forbids Chinese citizens to reveal Chinese accounting to anybody outside China (state secrets).
www.reuters.com/article/2012/05/10/us-china-auditors-risks-idUSBRE8491J220120510
bill8899:
Traveler, thanks for the informative link. When do you think they will dump the foreign English teachers?
Scandinavian, good points.
Traveler:
Bill. I think that has already started. China is much stricter with it's rules on which countries foreign teachers can come from. It is limited to 5 or 6 countries now, I think. Most African, Asian and South American countries are excluded
Additionally, I think that these days, there are far more Chinese teachers of English that have higher proficiency than many of the non-native English speakers that manage to sneak through into jobs. I think the Chinese also realise this, and it is not always the case any more where "any foreigner" will do.
Scandinavian:
The thing about the accounting firms only wanting Chinese natives will be the start of Chinese companies being unregistered from foreign (US) stock exchanges
Traveler:
It is not that he accounting firms WANT only Chinese staff. It is the government that is forcing that situation. The reason being, the government do not want the auditing firms reporting the rampant accounting frauds that is going on with most Chinese companies. That would scare away investors.
Instead, the government expects that investors must just invest blindly, without access to the real financial situation of a company. After the Caterpillar incident that was reported last week, I am sure that practice will have very little support in the future. At least Caterpillar laid down the law, and fired the managers that lied to them.
China has so far been conspicuously quiet about that. Perhaps the multinationals WILL eventually get control of the economy..
And yes. The accounting firms not being able to report financial situations is already leading to proceedings to delist many Chinese companies from the US stock markets.
Scandinavian:
wrote the last comment so late last night that I was not able to tell the difference between "want" and "must". As I must drink coffee in the morning, I now see that.
Just read about the Caterpillar acquisition. Paid $700 millions for something that turns out to be worth $120 millions. If that is how all Chinese companies are, then it's going to be an uphill battle to become/maintain status as largest economy in the world.
Traveler:
Scandinavian: Exactly right about the Caterpillar thing. The thing is, like the Longtop fraud, the banks are happy to forge bank statements to show the companies have more money than they actually do have. How can you trust anything in an environment like that.
I can't help feeling, though, that Caterpillar knew something, and have a plan to turn it to their benefit. But maybe not to China's benefit.
Scandinavian:
the worst story I have heard so far is about Fellowes having an entire factory stolen
http://directorblue.blogspot.fr/2011/04/how-outsourcing-to-china-cost-fellowes.html
In all of these cases it is probably easy in hind sight to say "they shuld have known" but when you are used to operating in a controlled environment, then the China business environment has more surprises than anyone can imagine
Averages are difficult to calculate or nonexistent. Some expats make more, but some make less. Your first query assumes all expats make more.
Yes it varies by profession. At private English schools you make more than the Chinese teachers. At a university it may depend on the tenure of the Chinese professor, but don't let them fool you into believing you have the highest salary. Other professions vary similarly.
I am not long-term so I regret I cannot answer this part.
Haha AFAIK there are precious few official statistics.
Others mentioned grey money and that makes a large difference in addition to subsidised rent, cell phones, autos and more.
Do not underestimate grey money, it may be several times their stated salaries and the salaries they report for income tax payments.
Last year I was looking at some salary figures in the field of IT work. I have forgotten the exact numbers but was looking at developers in Shenzhen. I found an english web site where it was listed that developers in Shenzhen start at about 8000 for freshly educated people, the going up as experience increases. At the same time my wife chinese web site, here the wages were almost half of the english site.
The short story is, there is a lot of variation, and when you look at salary in China, then most locals will have things like double pay, paid accommodation etc. where the salaries for the expats often is just a monthly sum.
(I also had the paranoid thought that the english site would have higer numbers as "stupid foreigners" should expect to pay they employees more in China, than Chinese employers. )
All I know is that expats make way more as teachers, but then that's why so many come.
By law now, as far as I know, employing foreigners is more restricted. The foreigner must be proven to have a skill set that can't be fulfilled by a Chinese worker, otherwise a Chinese worker must be hired. Or, the foreigner must be a qualified "expert" in a field that can help aid the Chinese company. So, things like "native speaker" is a common reason to hire a foreigner. Also cultural or specific expertise that your average Chinese worker might not or could not have.
This does not apply to WOFEs or foreign owned companies doing business, they can hire who ever they want (well, to a limit.... Can't import 1 billion laowai to work here.)
