Jun 25, 2014

    Guanxi fast losing its lustre as a guaranteed meal ticket

    TANG Jun, a famous professional manager in China, wrote part of an open letter to seven million college graduates this year, saying that, be it for work or in other aspects of life, people cannot do without relationships - or guanxi - in China, meaning that one's social networks are of utmost importance for one's personal development.

    For students, having a referral from social acquaintances can be a good way to get a job, because such guanxi is a person's unique resource.

    Although he wrote fewer than 100 words in the 1,000-word open letter, it was still unwise for a motivational icon like Tang to promote tacit rules in public, and it went against his intention, which was to encourage graduates with a low starting point to be successful.

    In recent years, and especially as China's economic growth slows, the competition for jobs has become increasingly fierce.

    With college enrolment increasing over the last 15 years, the number of graduates has risen sharply year by year, and it approaches seven million this year - seven times the number 15 years ago.

    While some college graduates may use personal guanxi to get a job, it would be impossible for all of them to use their connections to secure good jobs.

    So, Tang's advice would seem to be a pseudo-proposition, because guanxi cannot change the supply and demand relationship in China's job market.

    The competition for jobs would be unfair if it were dependent on a student's background, rather than his ability.

    In reality, most students are from ordinary families, and they do not have a family background that provides them with the connections to get a good job.

    In a market-oriented economy, the job market should follow market rules, like any other commercial market, so that it is survival of the fittest.

    To be more specific, graduates' talent in a particular field should be assessed, instead of their social connections.

    Otherwise, if students with better family backgrounds were to use their guanxi to get jobs, there would be fewer job opportunities for graduates without such connections, and the efforts of students who were born poor to live a better life would be hampered.

    Therefore, the use of guanxi for job hunting should not be promoted among college students, as it is unfair and unhealthy.

    In addition, guanxi is an outdated employment practice. It was popular in the past, mainly because economic reform in China was incomplete and there was much space for power-based rent-seeking.

    Companies might also get more business opportunities by employing graduates with better family backgrounds, even though they might be less capable than students from poorer backgrounds.

    However, amid economic reforms and with China's central government serious about fighting corruption, employers are beginning to pay more attention to an applicant's capabilities rather than his background.

    Most companies have established better human resource systems, and many employers prefer hiring individuals based on their merits.

    The word guanxi used to be a neutral word, meaning the connections between people or objects. But the latent rules in Chinese society have turned this word into a derogatory term, meaning the use of connections as a means of gaining an advantage over others.

    To some extent, a healthy guanxi theory could be applied and promoted in universities. The approval of teachers and internship units could help graduates who work hard in college to get jobs. Such a positive guanxi theory is worth promoting in society.

    Meanwhile, universities and the education authorities need to re-think their strategies, including their enrolment expansion plans, and switch their focus from academic talent to skilled talent, in order to resolve the imbalance between supply and demand in the job market.