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KAI RYSSDAL: For a lot of companies the key to surviving this recession is pretty simple: spend less. So travel expenses are getting another look. Marketing budgets are being trimmed. Labor costs are under the microscope, too. For multinational companies that can mean pulling their expensive overseas employees back home. And it makes sense; expat packages don’t come cheap. But that doesn’t mean it’s easy for the workers in question or for their families. From Shanghai, Marketplace’s Scott Tong reports.
Scott Tong: Jeff McCain was just getting good at China. He’d negotiated a multimillion dollar contract for his company. His wife and kids were learning Chinese. And he was about to rent a bigger house in Shanghai. Then…
Jeff McCain: The day before we were to sign for our lease, my boss called from back in the U.S. and said “Don’t sign that lease, because we don’t know what’s going on.” You know, we’re trying to cut costs.
McCain’s a manager for major auto supplier headquartered in Detroit. He visits factories, and negotiates with customers and suppliers. On top of his salary, his company forks out some $20,000 a year so his son can attend international school. And another $60,000 for his family’s annual housing. Typical corporate package. But times are not typical. So Jeff’s getting yanked, and replaced by a cheaper model.
Jeff McCain: A lot of the multinationals are looking at, hey can we bring over single people? Or people that don’t have school expenses?
Debbie McCain: It was shocking. And we were angry.
That’s Jeff’s wife, Debbie McCain. She doesn’t want to leave China, which is interesting, because two years ago she didn’t want to come.
Debbie McCain: I still remember the day Jeff left for working saying that he was going in to sign the contract. And I was crying the whole morning as he was walking out the garage.
Something changed; the McCains adjusted. Many of the 27,000 Americans in Shanghai will tell you it comes in stages, beginning with panic.
Debbie McCain: The day before the movers came, I found out I was pregnant with our second son.
When they got to Shanghai, Jeff found himself in an unfamiliar business culture. As an automotive supplier, he was used to American customers focusing on product quality and price. Here, it’s almost all about price.
Jeff McCain: They’re more willing to compromise on features. We’ll use a cheaper grade of steel. And maybe it won’t last as long, but that’s OK.
And Jeff had to adjust to much longer workdays. Every night, he gets home about 6:30, plays with the boys, wolfs down some dinner, and gets on the phone. His colleagues in Detroit are just waking up.
Jeff McCain: The conference calls usually start about 8 o’clock at night, and sometimes go until 11, 12 at night. So, you know, you’re working at least a day and a half each day. There’s really no off time. There’s times I’ve woken up in the middle of a conference call? Oh, what did I miss? I hope nobody asked me a question.
Over time, the McCains learned to thrive in China. Jeff found the expat softball league. Debbie found the grocery store that sells cheddar cheese and Captain Crunch. And they sharpened their elbows, the better to survive in this crowded city.
Jeff McCain: There’s times I get frustrated and I just push.
Tong: You just elbow them?
Jeff McCain: Yeah, I just take my forearm and just kind of shove them out of the way.
Debbie McCain: Strollers work good for that, too.
With the Mccains hitting their stride, they felt blindsided when headquarters ordered them back. Now, they will return to Michigan, and Jeff doesn’t know what job he’ll be doing. He also frets about the work he’ll be leaving behind; his company just built a transmission factory here in China. China’s a long-term investment for corporate America. But McCain’s employer is in short-survival mode. So for Jeff McCain and his family, the immediate future is clear.
Jeff McCain: Come on, we got to go.
In Shanghai I’m Scott Tong for Marketplace.
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