Blue-collar market offers potential
While graduate employment has drawn a lot of attention with regard to China’s labor situation, it’s worth noting that blue-collar jobs are still the mainstay of the country’s job market. That’s a reality that shouldn’t be ignored as domestic recruiting sites explore ways to expand their business, preferably through a shift toward higher-end talent.
On the sidelines of an event in Beijing earlier in December at which the 2017 Chinese Employer Brand Awards were announced, Yao Jinbo, CEO of classifieds firm 58.com, often described as China’s Craigslist, told reporters about 1 million to 2 million white-collar jobs are created each year in the country, while the working-age population increases by more than 10 million. This means that the majority of the new labor market entrants, whether they have gone to university or not, must settle for blue-collar and service-oriented work.
This would seem to indicate that great opportunities remain in China’s market for blue-collar recruitment, which has increasingly been Internet-based. Nevertheless, it appears that domestic recruiting sites are still largely concentrating on white-collar staffing, which is the type of work lots of Chinese people seek.
In a typical example of the preference for white-collar recruitment, 58.com, the most popular site for blue-collar staffing in China, acquired ChinaHR.com in 2015 to make inroads into white-collar recruitment.
At the Beijing event, the company released a report on employers of Chinese returnees, often nicknamed “sea turtles,” revealing that there’s strong demand for returnees in China’s Internet and financial services sectors. This is apparently an indication that 58.com is eyeing a foothold in higher-end talent recruitment.
But this shouldn’t mask the fact that the market for online blue-collar recruitment is still an underserved sector in the world’s second-largest economy.
The services sector’s growing contribution to China’s economy means more services-oriented blue-collar jobs are being created, which offsets concerns over a decline in blue-collar vacancies in the lower-end segment of the manufacturing sector.
According to a research note released in March by Hong Kong-based brokerage Guotai Junan International, which cited the Blue Collar Recruitment White Book 2016-17, China’s small and medium-sized businesses still need lots of blue-collar workers. This, along with the efficiency of online recruitment sites over other channels, will lead to increased use of recruitment portals among blue-collar workers. The research note said only 59 percent of blue-collar workers use online recruitment sites for job hunting, and it estimated that the proportion is likely to rise to more than 80 percent in two to three years. It therefore makes sense that 58.com is active in both segments of the online recruitment market. It’s venturing into white-collar staffing while still holding the bulk of blue-collar recruitment. But that’s far from being enough to sufficiently exploit the potential of online blue-collar hiring. In fairness, job sites that rely on paid memberships and recruitment ads as their main revenue streams tend to favor recruiters of white-collar workers, because these employers are generally inclined to spend more on finding the right talent. But what’s often ignored is that temporary workers account for a substantial part of blue-collar workers in the country, which means they need to use job search sites more often than white-collar staffers. The higher frequency and larger user base decidedly signifies huge business opportunities. Furthermore, online blue-collar recruitment services already available in the market are almost entirely job search sites. Recruitment sites should actually learn from other online-to-offline service providers that explore opportunities in areas that relate to their main business but are more sophisticated. For example, Chinese ride-hailing app Didi Chuxing reportedly announced plans in November to form a joint venture to build its own electric-vehicle charging network. For blue-collar workers who require education and training much more than their white-collar counterparts, a comprehensive package of services that comprise job hunting, training sessions that enable improved work skills and the prevention and settlement of labor disputes would be more valuable for not only blue-collar job hunters but recruiters. There’s certainly substantial room for investment in this regard, and this type of service could prove to be commercially viable if an integrated ecosystem of blue-collar employment could be built.
Domestic recruiting sites pushing for growth are advised to pay due attention to the lower levels of the recruitment pyramid.
Also worth pointing out is there’s thriving growth in the marketplace for Web-based recruiting services in areas such as Southeast Asia and India, which could be the next frontiers for domestic recruiting sites seeking an expansion beyond their home turf.
Among a total of 600 million people in Southeast Asia, the working-age population is about 200 million and blue-collar workers account for about half of them, according to an article posted in late 2016 by Chinese tech media platform 36Kr, quoting Emmanuel Crouy, co-founder of Singapore-based job review app GrabJobs, speaking of the under-tapped market for blue-collar recruitment in the region.
The transfer of manufacturing from China to Southeast Asian countries, the rising penetration of the mobile Internet and a relatively younger population structure are expected to underpin the rise of online blue-collar recruitment in the Southeast Asian market. That trend will provide enormous opportunities to be tapped by Chinese recruiting service providers seeking growth-enhancing formulas.
It’s also likely that Chinese recruiting sites could carve out a foothold in India, where Chinese smartphone vendors have a dominant market share, although that’ll mean intensive efforts to bring the country’s blue-collar workers online. That’s no idle dream. LinkedIn India, for example, has moved in this direction to enable local blue-collar jobseekers to access training courses.
For Chinese firms hoping to make a profit in the working world, the less glamorous but hugely promising blue-collar recruitment marketplace should be a higher priority.