Contracting roles are becoming more popular at foreign financial institutions in China. Although firms have ambitious expansion plans in the mainland, global budgetary pressures mean they can’t always get headcount approval for permanent employees.
Here’s where I see high demand for contractors.
· Human resources. Recruitment can be seasonal, with peaks after bonuses are paid, before university graduation, or when an aggressive expansion is announced. In order to hire the best candidates from a limited talent pool, banks often create short-term in-house recruiter roles.
· Operations and finance. Contractors in functions such as documentation, management reporting, MIS reporting, reconciliation, financial reporting are in demand for two reasons: 1) No training on sophisticated systems or applications is needed to perform these tasks; and 2) No close interaction with the front office (which usually takes a long time to establish) is required.
· Projects. Foreign banks need contracting project managers when they are establishing new businesses in China, or shifting hub-centre functions from high-cost countries. These roles are on contract terms for however long the project lasts. If projects overrun, or other projects become available when the contract expires, banks will usually extend the contract based on performance.
· Support functions for the front office. Contractor roles are rare in the front office, but sometimes temporary staff are needed to perform administrative tasks for revenue generators, such as documentation, client on-boarding and filing.
But is contracting worth the risk?
This really depends on the opportunity and the contract terms. I started my banking career as a six-month rolling contractor several years ago. My benefits were not different to permanent employees. And I was made permanent after my contract was rolled for the third time, when the business was sure of its strategy and the market.
The down side
However, today some contracting roles in China come with very unattractive packages. I have a couple of friends working as contractors who have no annual leave, limited sick pay, no medical insurance, and no training budget allocated to them. With such onerous terms, I initially assumed they would work only eight hours a day, but in fact they work just as hard as everyone else at the bank, in the hope of performing well and eventually being made permanent.
The up side
It is not a bad idea to be a contractor if you want to break into a new job function or city. And in time it will become easier for you to get a permanent post.
And not all contractor roles are low profile. I have another friend who worked in a leading international fund house and established the whole business when the brand first came into China. He worked on a 12-month project and created the China branch from scratch. He ended up with such high profile experience on his resume that his next package was a lot better than the market standard.
The views expressed in this article are those of the writer and not of eFinancialCareers. The author is a banker in China.
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