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Lack of employee loyalty upsets managers
14/11/2005 17:05

Jane Chen / Shanghai Daily news

Employee loyalty at local overseas-funded enterprises has diminished to such a low level as to upset the company executives, today's Laodong Daily said, citing the latest human resource survey.
From September 2004 to September 2005, the annual employee turnover rate stood at a high 16.7 percent, according to the survey, which was carried out jointly by Shanghai Foreign Service Co Ltd and the Shanghai Association of Foreign-Invested Enterprises.
Turnover rates in booming industries such as real estate, commodities, telecommunications, education and hotels and catering are higher at over 20 percent, and those of the commercial, pharmaceutical, chemical, financial and electronics sectors are lower at between 5 and 20 percent.  None of the industries surveyed reported a rate below 5 percent.
These high rates try the patience of management, with 75 percent of managers surveyed describing a flow rate below 15 percent as tolerable and 95 percent of executives preferring a rate below 16.5 percent.
All the manager respondents believed a rate higher than 20 percent has a negative impact on the development of an enterprise.
Chairperson Gu Jiadong of Shanghai Human Resources Consulting Association agrees that a manageable turnover rate is preferable. 
"A rate too low will stifle the development of an enterprise, while too-high a rate will destabalize it," he pointed out.
On the employees' side, job-hopping is seen as an effective shortcut to higher salaries. 
Work experience with one overseas enterprise helps them to easily find a better-paid position at other overseas companies.
Wang Hao, a sales manager with an electrical company in Shanghai, has changed jobs three-times in three years, succeeding in increasing his monthly pay fourfold from an initial 3,000 yuan (US$371) to his current 12,000 yuan.