Multi-national companies in China have a hard task hiring people with leadership skills while in India they face unreasonably demanding fresh graduates, a survey shows.
The fast pace of business expansion in Asia's two emerging economic powerhouses has created a talent shortage and a host of challenges for employers.
"Staff are impatient and there are a lot of jobs out there," said Shalini Mahtani, chief executive of Hong Kong-based Community Business. "If companies are not providing good career opportunities, staff will leave."
Community Business, an organisation promoting corporate social responsibility, conducted the survey in Shanghai and Mumbai with Schneider-Ross, a UK-based business consultancy.
Pay is still important as staff in China have no qualms in leaving a company to pick up a higher salary elsewhere, according to the survey.
In India, employers say younger professionals are demanding excessive compensation packages, inflated job titles and immediate opportunities for overseas assignments.
One multi-national talked of a fresh graduate who came for interview saying he had four job offers on the table and how could the company better that. Such demands were not unusual, the company said.
Pay is talked about openly in India and employees are liable to switch jobs if they know that their fellow graduates from business school are earning more. This makes it difficult for companies to reward good performance, survey participants said.
In China, competition for staff is so acute that one company reported losing a junior member of staff to a local company that more than doubled her salary and offered a position for which she did not have any experience.
The survey interviewed 25 senior managers and HR directors at foreign companies in Shanghai and Mumbai and conducted a focus group in each of the two cities.
A lack of leadership skills among staff poses a real challenge in China and many employees there leave a company because of the attitude or behavior of their boss, survey participants said.
Western multi-national companies are no longer routinely seen as the preferred employer, as staff in both countries often see local companies that are expanding globally as a better opportunity to gain visibility and climb the career ladder. Multi-nationals now are having to approach second and third tier colleges for staff.
Diversity in the workforce, whether by gender, generation or culture, is also difficult to implement because local managers either are not sensitive to the issue or business is growing so fast they have no time to focus on it.
In India, stereotyping of women is still common.
"There's an assumption that women will get married and they'll leave the workplace," said Mahtani.