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Professor Zeng Xiangquan Was Invited to Attend the 9th China Human Resources Management New Year Seminar and Made a Speech

On December 28th, Zeng Xiangquan, Professor of School of Labor and Human Resources and Director of CIER attended the 9th China Human Resources Management New Year Seminar and made a speech entitled “’New Normal’ Human Resources Management in ‘New Normal’ Economy-Retrospect and Prospect on Human Resources in 2014”.


In the speech, Professor Zeng Xiangquan pointed out that Chinese economy has been to a stage of “New Normal”. “New normal” human resources followed and had three main driven factors and six features.


The first driven factor was that the mode of economic development became “New Normal”: The pace of economic development slowed down; the structure of economy kept upgrading and optimizing; the main source of economic growth has changed from elements driven and investment driven to innovation driven. Under this background, the limits of the low-cost advantage created from unlimited labor supply and development momentum of vast investment on infrastructure construction have shown. The problems of innovation and industry upgrading have become very urgent, which posed pressure on reform of human resources management.


The second driven factor was that the implementation of “Rule China by Law”. The fourth Plenary Session marked the beginning of the new era of “Rule China by Law”. Companies need to focus on forming competitive advantage via management enhancement and efficiency improvement. In the meantime, companies need to better adjust to rules and laws of labor market.


The third driven factor was the new technology transformation featured in internet technology. Big data, intelligent production and mobile internet had huge influences on consuming environment and organizational behavior, and accelerated the process of “new normal” human resources management.


“New normal” human resources management had the following six features:


The first feature was the contradiction of human resources quantity and quality. According to State Statistics Bureau, the labor population by the end of 2012 decreased. The country has started to discuss Family planning policy in 2013 and is discussing the future retirement policy to adjust to the “new normal” stage. The decrease of labor supply has resulted in the continuous increase of labor price. Besides, the frequency and scale of human resources mobility has been increasing. Labor intensive companies suffered from high turnover rate, which was higher than 30%. In fact, the biggest problem was not the quantity but the quality of human resources. The contradiction of employment structure resulted from urban and rural isolation, short-term labor relation and the inadequate adjustment of education system to the market.


The second feature was the overall improvement of institutional environment, which stimulated the market’s vitality. The changes of institutional environment included the “three permissions” of state-owned enterprises, reform of public institutions, civil servant system, residence permit system, enterprise registration system. The “three permissions” (diversified ownership, non-state-owned capital shares and employee stock ownership plan) addressed on the third Plenary Session were already in progress. The “Human Resources Management Regulation of Public Institutions” issued by the State Council in 2014 required opening recruitment, competition for posts, performance appraisal, link between actual contribution and compensation and legal insurance participation, and showed focus on market and enterprises. In 2014, the government approved “Suggestions on Judicial System Reform Experiment” and “Shanghai Judicial Reform Experiment Plan”, which started the experiment on systematic management of judicial officials. On July 3rd, the State Council issued “Suggestions on Further Household Registration System Reform” and marked the start of the full operation of residence permit system, which will improve the situation of urban and rural isolation. Last but not least, the seventh document issued by the State Council in 2013 accelerated the reform on enterprise registration system and led to the explosive growth of new enterprises. The number of newly registered enterprises was increased by 61%.


The third feature was the integration of regional labor market, which mainly referred to Yangtze River Delta and Beijing-Tianjin-Hebei Region. Integration of talent in Yangtze River Delta, including multi-recognition system of qualifications, talent communication, talent training, set the example of talent integration. Beijing, Tianjin and Hebei province were closely connected and were complementary in talent in itself. However, barriers that restricted talent mobility were expected to be removed and new policies were expected to be released by reform.


The fourth feature was the acceleration of income allocation reform. In the first allocation area, the new policies were salary restriction on top executives in central enterprises and reform of position and level of civil servant in county. The “Reform Scheme on Compensation Policy of Principals of Central Enterprises” released this year set detailed rules on the gap between principals and general employees, the salary structure and benefits of principals. Newly released “Suggestions on Position and Level of Civil Servant in County” was the first document on the reform of position and level. In the reallocation area, the most significant feature was the overall improvement of endowment insurance system. To improve equality, the government established the unified endowment insurance system reform scheme of employees in government organizations and institutions and in urban and rural companies in December, which marked the end of the dual system of pension.


The fifth feature was the intensified talent war and diversified human resources incentives. Foreign and state-owned companies began to lose their advantages, while private enterprises attracted more talents. In the meantime, Chinese companies began to seek overseas talents. In this year, Huawei and Jingdong put considerable efforts on recruiting overseas talents. Diversified human resources incentives were reflected on employee stock ownership plan and “partner-like” incentives. New partner incentives included Vanke Model, Haier Model, Ali Model, Greenland Model, etc., which provided a new responsibility mechanism for business expansion, transformation and innovation.


The sixth feature was the human resources management development pushed by technological transformation. Big data had huge influences on human resources management. LinkedIn entered Chinese market; local new talent websites including, and HunterOn entered the market and implemented large amount of financing. This year was also the beginning of intelligent production. Zhejiang province clearly put the practice of roberts take the place of human into industry policies. In Dongguan and Shunde, factories that used roberts to take the place of human can get subsidies.


In the end, Professor Zeng Xiangquan made predictions on the market trend of human resources and labor market in 2015. First, under the background of “rule country by law”, labor market legislation will have new improvement. Second, difficulties of recruitment and increase of human resources costs will accelerate the replacement of technology in the place of labor. Third, income allocation will be challenged by both narrowing gaps and increasing incentives. Finally, working on startups will continue being popular among college graduates and employees in system.


Began in 2005, China Human Resources Management New Year Seminar was co-hosted by School of Labor and Human Resources, Renmin University, and Organization Department of The Communist Party of China Beijing Punicipal Party Committee. Academia and business elites participated in the New Year Seminar, effectively communicated with top officials of government, reviewed significant issues, and forecasted development trends. Professor Zeng Xiangquan was the important guest of the Seminar and made speeches to review and predict human resources and labor market every time. The theme of the 9th China Human Resources Management New Year Seminar was “Rule China by Law: Institutionalization and Integration of Human Resources Management”.

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