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More MNCs to trim payrolls due to global financial turmoil

THE hiring intentions of multinational corporations in Chinese mainland are at a seven-year low as more of them expect to trim payrolls because the global economic downturn has made them cautious, said a human resource report released in Shanghai yesterday.

The report, released by Hudson Recruitment, a Nasdaq-listed headhunting firm, surveyed more than 3,000 executives in businesses on the Chinese mainland, Hong Kong, Japan and Singapore in February about their recruitment expectations in the second quarter of this year.

Of the 843 respondents from the mainland, only 30 percent said they plan to increase staff numbers, 4 percent fewer than the first quarter. The figure is the second lowest since it hit 22 percent in the fourth quarter in 2001, although it remained the highest in Asia.

The downward trend is also emphasized by the 21 percent of employers who said they planned to cut their personnel head count this quarter, a jump from last quarter's 8 percent.

The steepest year-on-year decline in hiring expectation was in the manufacturing sector when it plunged from 53 percent in last year's second quarter to 21 percent. The proportion of employers who said they would lay off workers this quarter rose to 31 percent from just 1 percent in 2008's second quarter, and almost tripled from the first quarter of this year.

Industries that have been hit particularly hard include construction, automotive and supply chain as export orders fell, said Mark Carriban, Hudson's Asia managing director.

The banking and financial service sector was another big factor for the fall as 27 percent of employers said they had laid off employees last quarter, compared with last year's 57 percent.

Although there is still some hiring activity in the sector, most prefer sales professionals with corporate banking experience. "The US sub-prime had yet to have a major impact on the Chinese banking sector, but its effects have been widely felt over the last year," Carriban said.


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