70,000 jobs and more to come

More than 70,000 jobs have been cre­ated through Chi­nese in­vest­ments in the US, and that num­ber could reach 200,000 to 400,000 by 2020 if in­vest­ment stays on track, ac­cord­ing to the lat­est data, re­ports China Daily’s Cai Chun­y­ing from Wash­ing­ton.

China Daily (Canada) - - IN DEPTH -

L$14 bil­lion

Chi­nese in­vest­ment in the US has in­creased rapidly since 2009 and reached a record high to­tal deal value of $14 bil­lion in 2013, ac­cord­ing to Rhodium. The num­ber of jobs cre­ated was only around 2,000 in 2000, slowly moved up to about 9,000 in 2007, but rapidly in­creased to ap­prox­i­mately 27,000 in mid­dle 2012 and rock­eted to 70,000 by the end of 2013.

A cou­ple of high-pro­file deals con­trib­uted sig­nif­i­cantly to the job rise, in­clud­ing the ac­qui­si­tion of AMC by Dalian Wanda in late 2012, A123 by Wanx­i­ang in early 2013, and Smith­field by Shuanghui last Septem­ber. Shuang­hai has kept all the 37,000 or so po­si­tions Smith­field has. Rhodium’s data also show that many ex­ist­ing Chi­nese com­pa­nies in­creased lo­cal hir­ing in 2013.

If in­vest­ment from China re­mains on track, Chi­nese com­pa­nies will em­ploy 200,000 to 400,000 Amer­i­cans by 2020, ac­cord­ing to Rhodium.

Ja­pan is a good ex­am­ple of the im­pact that in­vest­ment from a newly emerged econ­omy can have in the US. Prior to 1980, Ja­panese com­pa­nies’ em­ploy­ment num­ber in the US was al­most neg­li­gi­ble. To­day, their US sub­sidiaries are send­ing pay­checks to al­most 700,000 Amer­i­cans, nearly 12 per­cent of the to­tal jobs sup­ported by for­eign di­rect in­vest­ment in the US. uis Fiallo never thought he would be with a Chi­nese com­pany for very long.

As man­ag­ing di­rec­tor of busi­ness de­vel­op­ment at China Tele­com Amer­i­cas, the US sub­sidiary of a lead­ing tele­com car­rier in China, Fiallo has been with the com­pany for al­most 10 years.

“I thought I would just stay for a cou­ple of years and move on,” said Fiallo, who was born in Ecuador and grew up in Wash­ing­ton. “But I re­ally like the en­vi­ron­ment, my col­leagues, and the op­por­tu­ni­ties the com­pany has pre­sented to me, so I stayed.”

“In fact, I’ve never worked for a com­pany for that long,’’ he added.

Fiallo is among the nearly 120 em­ploy­ees the Vir­ginia-based com­pany has, of which about 70 per­cent are, like Fiallo, lo­cal hires.

“When I joined the com­pany, China just started to catch up, so there are a lot of ne­ces­si­ties for lead­er­ship and ex­pe­ri­ence. I feel what I do has im­me­di­ate im­pact so I re­ally en­joy it,” said Fiallo who is mainly re­spon­si­ble for de­vel­op­ing the Latin Amer­ica mar­ket for the com­pany.

Fiallo’s job is also among more than 70,000 that Chi­nese in­vest­ment in the United State has cre­ated so far, ac­cord­ing to re­cently re­leased data by Rhodium Group, a New York-based re­search firm that tracks for­eign di­rect in­vest­ment from China in the United States. that. Com­pa­nies com­ing as green­field projects in­clude new fac­to­ries, dis­tri­bu­tion cen­ters, and R&D di­vi­sions — all that cre­ate most new jobs.

Wanx­i­ang, a lead­ing pri­vate Chi­nese com­pany spe­cial­iz­ing in pro­duc­ing auto parts, en­tered the US mar­ket in 1994 and has ex­panded into a diver­si­fied busi­ness em­ploy­ing more than 6,000 peo­ple.

COSCO Amer­i­cas, the Se­cau­cus, New Jersey- based US sub­sidiary of China Ocean Ship­ping (Group) Co, started its ven­ture in the US in 1982 man­ag­ing a sin­gle con­tainer ves­sel per month. Now it em­ploys nearly 600 peo­ple with more than 90 per­cent of them lo­cal hires, in­clud­ing union work­ers.

Haier, the home-ap­pli­ance gi­ant in China, es­tab­lished its first man­u­fac­tur­ing fa­cil­ity in South Carolina in 1999. To­day it em­ploys about 470 peo­ple. Hisense, Haier’s com­peti­tor in China, set foot on US soil in 2001 and now its Ge­or­gia-based North Amer­i­can head­quar­ters has about 100 peo­ple with 80 more to be added this year. Hisense’s At­lanta neigh­bor, Sany Amer­ica, the US sub­sidiary of the largest con­struc­tion equip­ment com­pany, started its 400,000 square-foot new fa­cil­ity in 2006 and it now houses about 100 em­ploy­ees. Com­pa­nies res­cued

Merg­ers and ac­qui­si­tions by Chi­nese com­pa­nies have also con­trib­uted to job cre­ation in the US by main­tain­ing — and in some cases in­creas­ing — orig­i­nal staff base. Many Amer­i­can com­pa­nies have been res­cued from bank­ruptcy, sav­ing hun­dreds of jobs that were about to be lost.

Ac­cord­ing to a study con­ducted by the Rhodium Group in 2012 on more than 170 M & A cases, Chi­nese buy­ers main­tained and in many cases in­creased staff af­ter ac­quir­ing a US busi­ness. There is no ev­i­dence of the as­set-strip­ping be­hav­ior that many had feared.

The study also points out that those few ac­qui­si­tions that have re­sulted in job losses have gen­er­ally been due to struc­tural ad­just­ment and re­or­ga­ni­za­tion of value chains to re­act to changes in costs or de­mand, which is a com­mon prac­tice in the in­dus­try.

To many Chi­nese com­pa­nies, lo­cal tal­ent is a gold mine that they need to take ad­van­tage of to sur­vive and ex­cel in the highly com­pet­i­tive US mar­ket.

Ac­cord­ing to a sur­vey of 50 top ex­ec­u­tives in Chi­nese com­pa­nies in the US, con­ducted by APCO World­wide and China Daily USA in 2012, the top ad­vice th­ese ex­ec­u­tives said they would give to Chi­nese com­pa­nies look­ing to come to the US is to “hire or work with lo­cal ex­perts and staff.”

Joe Han, CEO of China Tele­com Amer­i­cas, did ex­actly that for his com­pany. Em­ploy­ees in his sales team are all lo­cally hired Amer­i­cans, a tra­di­tion he started as vice-pres­i­dent of mar­ket­ing and sales be­fore be­com­ing CEO in 2013.

“They are all sales vet­er­ans work­ing for other com­pa­nies be­fore, so they know how to op­er­ate in the US mar­ket and their own cul­tural en­vi­ron­ment,” Han told China Daily. Cul­tural dif­fer­ences

For UCWeb, China’s most pop­u­lar mo­bile-browser maker, the big­gest chal­lenge to suc­ceed in the US is to bridge the cul­tural dif­fer­ences be­tween the two coun­tries. Yu Yongfu, CEO of UCWeb, hopes that hir­ing lo­cal tal­ent can help solve that.

Yu uses col­ors as an ex­am­ple. He says the color red rep­re­sents alarm and trou­ble in the US but hap­pi­ness and for­tune in China.

“That’s why our prod­uct de­vel­op­ment op­er­a­tion in the US needs to hire more lo­cals,” Yu told China Daily, “they know the taste of their fel­low Amer­i­cans.” UCWeb opened an of­fice in Sun­ny­vale, in Cal­i­for­nia’s Sil­i­con Val­ley in 2012 and has an ag­gres­sive plan to ex­pand.

Wang Xin, CEO of Si­no­me­dia In­ter­na­tional, a Chi­nese me­dia en­ter­prise geared to­ward pro­vid­ing high-qual­ity cross­cul­tural pub­li­ca­tions, spares no ef­fort to lo­cal­ize Si­no­me­dia’s op­er­a­tion by hir­ing lo­cals to de­velop its busi­ness, from topic se­lec­tion, re­search and edit­ing to mar­ket­ing and sales.

“Let the lo­cals choose topics the lo­cals will have in­ter­est in read­ing; and let the lo­cals sell books in the US us­ing meth­ods ap­peal­ing to the lo­cals,” Wang said. “We ben­e­fit a lot (by do­ing so).”

Lawrence Li, CEO of Hisense USA, also shares this judg­ment. Li said he re­cently hired a se­nior man­ager in hu­man re­sources and has seen sig­nif­i­cant im­prove­ment in per­son­nel man­age­ment since then.

“We have in­stalled new rules and im­proved our com­mu­ni­ca­tion mech­a­nism. I be­lieve we op­er­ate more ef­fi­ciently and ef­fec­tively now,” said Li, who be­came CEO in 2007.

Some Chi­nese com­pa­nies are even more ag­gres­sive, hir­ing Amer­i­cans to lead their US sub­sidiaries.

Sany Amer­ica is one of them. The com­pany hired Tim Frank, a se­nior ex­ec­u­tive from Cater­pil­lar, to serve as its chair­man in 2012.Work­ing to­gether with Jack Tang, the com­pany’s then pres­i­dent, Sany Amer­ica re­ported its first profit in Oc­to­ber 2012 and has since then kept its profit edge.

Sany Amer­i­can re­cruited new CEO Mike Rhoda in De­cem­ber last year af­ter Frank de­parted for “per­sonal rea­sons”, as cited by Tang. Rhoda was pres­i­dent of Volvo’s ex­ca­va­tor busi­ness line be­fore join­ing Sany.

“I have been fol­low­ing Sany for sev­eral years while work­ing for other com­peti­tors and I’ve been im­pressed with their am­bi­tion and as­pi­ra­tions,” Rhoda told China Daily.

Rhoda said he has worked for other Asian com­pa­nies be­fore and there­fore reached a level of un­der­stand­ing of some of the cul­tural dif­fer­ences that Chi­nese and Asian com­pa­nies run into when op­er­at­ing in the West. For many Amer­i­cans, work­ing for a Chi­nese com­pany is a new ex­pe­ri­ence.

Kirk Er­linger, di­rec­tor of sales and dealer de­vel­op­ment at Sany Amer­ica, said that he still has dif­fi­cul­ties in un­der­stand­ing some of his Chi­nese col­leagues’ English.

“I tend to speak very fast and I of­ten have to slow down and ex­plain pa­tiently so they can un­der­stand me,” said Er­linger, who joined Sany Amer­ica in 2011 af­ter work­ing for crane deal­ers for more than 20 years.

Er­linger also wishes the de­ci­sion­mak­ing process can go faster. He no­ticed that some of his Chi­nese col­leagues are hes­i­tate to voice their opin­ion in a group meet­ing prob­a­bly due to the cul­tural dif­fer­ence be­tween the two coun­tries.

He also no­ticed that it of­ten takes longer than he likes to have some plans im­ple­mented be­cause the US sub­sidiary needs to com­mu­ni­cate back and forth with its Chin­abased head­quar­ters and achieve con­sen­sus.

Er­linger, how­ever, said he en­joys the trust he has built with his boss, Jack Tang, pres­i­dent of Sany Amer­ica. “I can just come in and share my thoughts with him with­out any hes­i­ta­tion,” said Er­linger, who over­sees five sales­men, all lo­cally hired Amer­i­cans.

Jonathan Frank, vice-pres­i­dent of mar­ket­ing at Hisense USA, how­ever, said one thing that he likes in work­ing for Hisense is its speed to act quickly when needed.

“De­ci­sion-mak­ing is a lot longer process with more lay­ers in an Amer­i­can com­pany. It is re­fresh­ing to see within Hisense that when a de­ci­sion needs to be made, it can be made rel­a­tively quickly with fewer lay­ers,” said Frank who joined Hisense USA in March last year af­ter work­ing for Voxx In­ter­na­tional and Pana­sonic.

Frank said he also likes the mul­ti­cul­tural at­mos­phere in Hisense:

“You al­ways have a dif­fer­ent dy­nam­ics when you got mul­ti­cul­tural em­ploy­ees and I like that. I think it should be our strength and it is bet­ter for em­ploy­ees be­cause they learn from each other and each other’s cul­ture and it makes ev­ery­one bet­ter.” ‘Al­ways learn­ing’

Fiallo, China Tele­com Amer­i­cas’ vet­eran man­ager, also en­joys the learn­ing process.

“I feel I am al­ways learn­ing new things. My Chi­nese col­leagues al­ways say that they learned new things from me, but I am the one who is learn­ing from them. We have to learn how to col­lab­o­rate and how to work to­gether,” he said.

Man­ag­ing a work­force that does not share their own cul­ture can bring chal­lenges to Chi­nese CEOs. Many, how­ever, said they find it eas­ier than they thought.

Lawrence Li, Frank’s boss, said he was sur­prised to find that his Amer­i­can col­leagues are able to adapt to his com­pany’s needs of get­ting up early in the morn­ing or stay into late evenings to have a re­al­time con­fer­ence with the com­pany’s Chi­nese head­quar­ters, which has a 13 -hour dif­fer­ence from the US.

“I thought they would com­plain. But each one of them show up on time,” said Li.

He said com­mu­ni­ca­tion plays a cru­cial rule to bring the em­ploy­ees from China and lo­cal hires to­gether. “We’ve had mul­ti­ple chan­nels of com­mu­ni­ca­tions. We need to make sure that con­cerns are heard and ideas are thor­oughly ex­changed,” said Li.

Tang, for­mer pres­i­dent of Sany Amer­ica, who has now moved to lead Sany’s wind-en­ergy in­vest­ment in the US, said in an ear­lier in­ter­view, “We need to learn how to work to­gether with lo­cal hires. Com­ing from dif­fer­ent cul­ture and busi­ness back­ground, the key is com­mu­ni­ca­tion and build the trust.”

The trust, in Frank’s eye, is there. The vice-pres­i­dent of Hisense USA said, “We al­ways say that we are like a start-up com­pany with a big back­ing com­pany. Ev­ery­one works here re­ally takes the com­pany’s in­ter­est at heart and we all share the same goal.” Con­tact the writer at charlenecai@chi­nadai­lyusa.com

PRO­VIDED TO CHINA DAILY

Sany Amer­ica, the US sub­sidiary one of the world’s largest con­struc­tion-equip­ment com­pa­nies, has about 100 em­ploy­ees at its 400,000 square-foot fa­cil­ity in Ge­or­gia.

ZHANG YUWEI / CHINA DAILY

Liu Hanbo (right), pres­i­dent of Cosco Amer­i­cas, chats with his Amer­i­can and Chi­nese col­leagues at the com­pany’s head­quar­ters in Se­cau­cus, New Jersey.

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