I’m writing this from Beijing, so I had a chance to read China Daily this morning.  The paper has a above the fold front page article titled, “China faces uphill task on job creation this year.”  The story covers the challenge China faces with 25 million people competing for approximately 11 million job openings this year.  Although the absolute magnitude of the challenge is less, this mismatch is mirrored in China’s software industry.

Even with the recent dramatic growth in outsourcing, China still has a fairly large number of software professionals in the job market.  The surplus is most notable among less experienced engineers where there are generally multiple candidates for each available job.

The primary impact of this broad based talent pool from the outsourcing business perspective has been a pretty hard cap on salaries for less senior engineers.  This has enabled China outsourcing vendors to maintain stable rates, or even lower base rates in some cases as their delivery efficiency has improved, and it bodes well for a stable rate picture for the foreseeable future in China.

Let me know if you can’t access the article on China Daily’s website and I’ll put a PDF up on this page.

Technorati Tag:  China

The nice folks, and I use the term literally, over at The Symbio Group have won some pretty impressive recognition.  They were included in the list of the Top 10 Places to Work in China.

The list was produced by ChinaHR, self-proclaimed to be the most authoritative recruiting website in China. ChinaHR screens its list of incoming resumes to identify the companies and jobs most desired by its applicants.  The data becomes somewhat self reinforcing as it is used as feedback for new candidates to help them identify the best companies to pursue.

Other organizations on the list include IBM, Microsoft, Huawei and Tsinghua UNIS.  With this distinguished company, Symbio’s accomplishment is especially impressive as it is a much smaller organization.  I’m pleased to see that Symbio’s sustained attention to their employees and to creating a positive corporate culture is paying dividends for them.  An immediate positive impact is that they have much lower employee turnover and higher productivity than many of their competitors.

One thing that caught my attention about this list is that several of the selected organizations are outsourcing teams.  This suggests that outsourcing jobs are highly desired in China.  I’m especially struck by this as there are so many alternatives for Chinese engineers right now.  It bodes very well for the growth and development of the Chinese outsourcing industry!

Congratulations to Symbio for this recognition!

BTW: I decided not to post a link to the original article from ChinaHR because there isn’t an official English translation.

Technorati Tag:  China

The World Intellectual Property Organization (I got the URL from Google, but I couldn’t reach their site - I checked with WHOIS, and it’s registered to the organization, so I hope that it’s right) is reporting that China now ranks 10th in the world for filing patent applications.  China filed for 2452 patent applications in 2005 which was a 44% increase over 2004.  This is a tiny peek into the dynamic innovation now occurring within the country.

China is evolving very rapidly from using foreign intellectual property to developing its own IP for both domestic use and export.  China is building its foundation of engineers and scientists who can create and develop technologies.  This will eventually impact outsourcing firms as these people continue to help build the industry.

One of the reasons that China is so interesting as an outsourcing destination is the availability of a workforce trained not just to be service providers, but also to be product developers in their own right.

UPDATE:  China Law Blog has also posted on this topic from the perspective of IP protection in China.  They take a nicely balanced position on the issue, it’s well worth a look.

Technorati Tag:  China

VentureWire is reporting that Accel and IDG Technology Venture Investment, Inc. (IDGVC) just closed their China fund.  Originally targeted at US$250M, it was oversubscribed and ended up at $290M.  I didn’t link to VentureWire’s story, because I can’t afford a subscription, but Accel had an announcement of the fund’s creation in 2005.  Apparently IDGVC will be managing the fund.

While this isn’t huge in terms of US funds, it amounts to just under 2.4 trillion yuan, which should buy a lot of equity even in China’s possibly overheated investment climate.  I wonder if any of it will flow to some of the outsourcing companies that that I’ll be talking about here.  Anyway, my best regards to the Chinese entrepreneurs that will be putting these funds to work!

Technorati Tag:  China