Employee tenure and the nationality of joint ventures in China

Abstract

The retention of qualified Chinese employees is an increasing concern for managers in China today. Various studies have highlighted the rise of turnover rates, and many have suggested how human resource practices can help promote retention. However, little research has compared employee tenure or the use of human resource practices for retention between firms of different nationality in China. From a theoretical point of view, such comparisons: are likely to reveal differences; would be vital for gaining a better understanding of the phenomenon; and would help us in establishing best practice. We therefore conducted a comparison of average employee tenure and the use of HR practices between Sino-foreign joint ventures with Western (EU/US), overseas Chinese (Hong Kong/Taiwan), and other Asian (Japanese/Korean) partners. Primary data from questionnaire surveys were obtained from a total of 316 joint ventures in Beijing, Tianjin, and Qingdao. We found a significant relationship between nationality and tenure. Tenure was the highest in overseas Chinese, moderate in Japanese/Korean, and lowest in Western firms. The results also suggest that the variation in tenure between nationalities was partly mediated by the firms' use of a human resource practices. We discuss these results in terms of cultural differences and the long-term orientation of human resource systems.

Keywords:

• China
• employee tenure
• firms
• HRM practices
• nationality
• retention
• Sino-foreign joint ventures

Acknowledgement

Financial support from the Leverhulme Trust, grant number F/00 261/U, is gratefully acknowledged.