Employee turnover reaches 20.8% in China – Aon Hewitt

Industry-wide turnover rates in the Chinese hotel industry reached 43% in 2016, with an average rate for all industries of 21%, according to data from Aon Hewitt. Turnover rates in internet industries were also high, due partly to ‘immature management and business models’, according to the company. The proportion of compensation and benefits costs to revenue keeps rising in China, for example, amounting to 32% in the engineering industry, necessitating an urgent need to improve productivity. Chinese businesses are proving to be innovative on variable pay, particularly in the area of long-term incentive

Ni Baijian, principal consultant at Aon Hewitt, says:

‘Leading private enterprises are more aggressive in long-term incentives than state-owned enterprises and foreign invested enterprises. In addition, private enterprises have been exploring richer and more diverse approaches regarding stock option incentives.’

Aon proposes that Chinese enterprises should adopt the following approaches to retain and engage top talent:

• encourage a high-performance culture
• cultivate engaging leaders
• pay attention to total reward statement communication
• develop a compelling employee value proposition.

‘Human capital intelligence study’, Aon Hewitt, November 2016: http://aon.mediaroom.com/news-releases?item=137511