Peter Arkell, Managing Director China presents Swann's latest survey findings.

The third Swann Global annual salary survey of the international mining community in China was recently completed. Data from the China International Mining Group (CIMG) members has been collected during September/October 2008 and the early findings are emerging. A full summary report will be completed in December and distributed to participating companies. 

The nature of the international mining community in China has changed during the past three years that these surveys have been conducted. Three years ago this was predominantly an industry of commodity traders and explorers, with only a small number of mining operations. Today however, there are numerous international projects and a range of suppliers from construction to laboratory active in the China international mining scene. In other words the industry is maturing and as a consequence, there is an increased range of occupations now included in the survey. 

Furthermore, the spread of commodities reported in the survey as being mined or under exploration was also significant.

This increased activity has seen some interesting changes in the demographic of the workforce. In the 2007 survey the emergence of the returnee was a very important talent target, and consequently they became the most expensive category in Executive Management ranks. The average salary for Returnee Executive Managers was again the highest rate in this group. However, as China’s mining industry has grown and the demand for talent increased there has also been an increase in the number of Expats as a proportion of the total executive workforce.

This is largely explained by the fact that there are only a limited number of professional returnees and that the strong demand for talent requires that these roles be filled by either Expats or Locals who have a high level of experience within international companies in China.  

According to the average for each category - Expat, Returnee and Local, the Returnee Executive Manager remained the most expensive option and their salaries increases by 9% from 2007. The growing demand for Executive Managers meant that the expatriate rates also increased by 16% whilst Local wages increased by 60% over the previous year. The survey therefore suggests that international companies are attending to the development of Local management talent. In the Senior Management group 86% of the workforce was locals.

This year’s survey saw that Local Senior Managers were paid significantly higher salaries this year. In the 2008 survey, Swann Global found that the average rate for Local Senior Managers increased by almost 50% compared to 2007. There was a strong correlation between higher wage rates and English language ability and years experience in an international company. Rates for Local Middle Managers also increased by about 40%.  

Swann Global’s China salary surveys have always closely monitored Geologists. As a group, they have been in great demand due to the industry’s strong exploration focus in China. 

Combined with the global demand for Geologists, there was a predicted increase in the Executive Geologist salary of almost 30%. This group is comprised largely of Expats (70%) and Returnees (20%), whose rates must be internationally competitive to bring them to, and keep them in, China. Having said that, the average rate for local Executive Geologists increased by 38%. This reinforced both the increasing demand for and value of Chinese professionals. 

In the next category of Senior Geologists, the ranks were dominated by locals, whose representation increased by 14% over the previous year. There was a similar breakdown of locals and expats in the very ’hands-on’ group of Middle Geologists. These people generally are practicing professionals in the field with little or no management responsibility.

Throughout the other categories surveyed - Technical Professional, Support Service and Support Administration, wage observations are following the upward trend reported in 2007. Again there remains a strong correlation between high rates of pay, English ability and international experience.  

One theme that started to emerge in this year’s survey was the effect of currency on a person’s compensation. This currency issue will be examined in greater detail next year. In previous years expatriates and returnees were generally paid in USD whilst locals paid in RMB. As the USD-RMB relative value dropped by 10% over the survey period, Expats began being paid in RMB or ’home country’ currencies. 

The annual Swann Global salary survey is a snapshot of the international mining community in China. They are a guide to happenings in this labour market. Each year the number of participating companies grows and. Swann Global will continue to share the data collected with those who contribute. These companies will receive the detailed summary report towards the end of the year. As is practice, participating companies can request specific reports to benchmark their own operations. The support of the CIMG is greatly appreciated in the promotion of this project each year.

If you would like to participate in future surveys and then have access to the details of the data, please feel most welcome to contact Swann Global’s offices in China or email to china.survey@swannglobal.com.