Staffing issues arise from rampant growth in China

The Chinese accounting profession’s rapid growth is presenting
unique staffing challenges, according to Ernst & Young China
(E&Y). The firm’s managing partner David Sun said China has
been an excellent area for the global firm to expand its practice
and that there has been double-digit growth in all core service
lines. E&Y revenues increased by 41 percent for the fiscal year
to 30 June 2007 in China.

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Sun stressed the need to develop and retain staff is a vital
strut of this projected growth. E&Y currently employs 8,000
people, an increase of 30 percent in the past year. This is in line
with its target to employ 11,000 people by 2010.

In 1992 there was virtually no accounting profession in mainland
China but 15 years later there are 130,000 members. However, the
demand is still much larger than the supply. “In the next few years
the training at universities and setting the foundation for the
training of accountants is very important,” Sun said.

E&Y faces stiff competition and gender and cultural challenges
in its battle against staff attrition, according to Sun. Staff loss
is an unwanted side-effect of the Chinese economy’s success. He
said the buoyant market has resulted in E&Y losing staff to
clients that look to firms as a field for recruitment.

Gender is also an ongoing issue in China. “Many people joining us
are female but as they progress the female attrition rate is a lot
higher and that will affect the growth of the profession as well,”
Sun explained.

Addressing female attrition is an industry challenge where 70
percent of Chinese university accounting students are female.
Within E&Y the rates reflect this gender imbalance: 64 percent
of all its employees are female, although at the partner level the
mix is quite different and women make up only 27 percent. Sun said
the predominance of women coming into the profession will require
Chinese firms to be more sensitive to their needs.

“We are setting personnel policies that will help female
accountants, staff and executives in our firm manage the work/life
balance. [We are] making it more flexible for them, using
technology to make sure they can handle the demands of home life as
well as professional life,” he said.

Promoting a better working relationship between mainland and Hong
Kong Chinese, and non-Chinese, is another challenge. Mainland
Chinese make up 85 percent of E&Y’s staff, Hong Kong Chinese 10
percent and non-Chinese 5 percent. Sun explained: “[Mainland
Chinese and the Hong Kong Chinese working together] is not as easy
as many people think. Hong Kong Chinese are slightly different from
mainland Chinese. In many degrees it is different because we come
from different environments, backgrounds and different mindsets. So
that in itself has already needed a lot of attention.”

The firm has tried to reduce cultural differences by using teaming
exercises that put different groups together to work.