TEXT OF INTERVIEW
Steve Chiotakis: China's currency swung down today. It's seesawed since the weekend, when Beijing unpegged the yuan from the dollar. Long-term, though, most expect it to rise, nudging up the price of Chinese exports. But there's another reason Chinese goods may cost more: higher labor costs. Young workers are harder to find, in part because of China's one-child policy. Marketplace China Correspondent Scott Tong is with us from Shanghai to explain. Hi Scott.
Scott Tong: Good morning, Steve.
Chiotakis: So the one-child policy is going on 30 years. That generation is entering the work force, right?
Tong: Yes, and this generation is, as many people call it, the "little emperors". In general, they were the center of their universes growing up, and now the whole constellation has changed. They're now workers. Several HR managers we spoke to described this generation in general as moodier, more demanding, a friend of mine even said that they take personal calls when they're interviewing. What surveys show clearly is human resources is the number one source of angst for businesses in China.
Chiotakis: And answering a personal call during an interview, it doesn't sound like they're going to get hired, right?
Tong: Well, you need to hire some people from this generation, I mean this is a whole generation of people. And for all the complaints, this generation has a lot going for it. They're much more educated than ever before and they're known to learn quickly. So given the right incentives, they will produce. Now if you're the company and you get it wrong, they will bolt. The turnover rate in Shanghai is something like 20 percent, compared to like 5 percent in advanced economies.
Chiotakis: So Scott, so many opportunities there in China, I mean how do companies hang on to those workers?
Tong: It's really hard for them. China's growing so quickly that there aren't enough good people for all of the international companies that want to hire them. So they have these only children who have sky-high expectations. One manager says his workers expect to be promoted every two years, and a 10 percent raise every year. Well think about, then, that China manager for a multinational company. He or she has to call headquarters back and say Detroit, and ask for double-digit personel raises. And Detroit says, "No, this is a recession -- call back when you're sober." So have a little pity for HR managers in China, this is a challenging generation of new workers to deal with.
Chiotakis: Marketplace's Scott Tong reporting from Shanghai. Scott, thanks.
Tong: You're welcome.