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This is an age of change, of China and of the world.
I feel it, but cannot name it. I see it all the time with all those small things in my life, but still cannot tell what it really means. My simple instinct tells me, 2007 is a very interesting and unique period for China. My friends, help me to understand it.
Job Market
My reader SuperDav asked me the question:
I see you've previously posted about some locals making 300-500,000RMB (per year). That's almost $75k/ yr. USD! Most people in the US don't make more that unless they have been working for MS for ten years...:)
I believe SuperDav must be surprised, that 500,000 RMB is not a very high salary in Shanghai in 2007 any more. I am not saying it is not high, but I can assure you there are so many people in Shanghai (senior managers in foreign, and local companies) earn more than that. Considering the exchange rate change between US, and China, the rate means higher than before. The recent salary survey I saw surprised me a lot - with the continuous CPI increase, the salary level in Shanghai finally raises. The concept that Chinese always earn less than foreigners should be updated.
The other interesting thing is, as I wrote in another blog, Foreign Job Seekers Move to Shanghai. This is also a trend that didn't happen in the last centaury.
Capital Market
The recent IPO of PetroChina in the Shanghai Stock Exchange makes it the largest company in market cap in the world, by passing the second place, EXXON.
The second event is, China Mobile's market value bypassed Microsoft and became the largest technology company in the world several months ago.
Although the market cap does not reflect the power of the company, especially the PetroChina case, where the P/E is much higher in Shanghai stock than in U.S., and China Mobile is complete monopoly in the market, it is very interesting fact. There are some Chinese companies getting bigger in some way than U.S. companies. (P.S. Don't need to argue about the fact. I know it means nothing using the irrational market valuation ways in current crazy Chinese stock market. I know that. I just want to play the numbers and show something that is very rare before).
People's Life in China
I had the conversation with my parents the other day. I said, after centauries of poverty, Chinese people have to face the dramatic change in the next few decades of moving from poor, to wealthy. I wrote about this in previous article Not Be Afraid of Grace and Beauty (my thoughts when I was in YLF). I just realized the grace and beauty of the ancient China is coming back these days. Art, music, drama, film, even space technology is just like Renaissance. Which really means something.
Stronger China?
I don't want to be too optimistic than I should be about the future of China. It is very hard to tell whole story about China and it is even harder to make any prediction. China is such a mixed subject mixing the worst, and the best, the richest, and the poorest. So, I don't try to be complete (since no one can do that). I just picked some events, and attempt draw one side of the reality of China.
In reality, many things changes, but in mind, it may takes longer for people to realize it. The gap is there. It takes time.
What is your comments?
Posted by Jian Shuo Wang at December 16, 2007 4:32 PM
Copyright: You are free to redistribute this work, as long as you keep this disclaimer
and this link: http://home.wangjianshuo.com/archives/20071216_the_age_of_change_in_reality_and_in_mind.htm
break GFW first
and don't get used to its fxxxing existence
The salary in Amoy is always like this>>>>>>>>>>>>>>_____the horizontal level-line, but the price for everything is on the hike. It is unbelieveable as what you described how much people make in Shanghai..Even the director of my dept. , Dv Cordero told us that in California, or in the whole US, the salary for our general citizen is always level down these years.
Posted by: Layla on December 16, 2007 8:56 PM500,000 RMB is not a very high salary in Shanghai in 2007 any more.
Can you come tell this to my boss please?
Posted by: Micah Sittig (external link) on December 17, 2007 12:24 AM500,000 RMB means at least 40000RMB/month, very very rare people in shanghai have salary like this high , the average salary of gruadated students is still below 3000RMB/month , and a lot of them can't even find a job. I do wonder how jianshuo have such an opinion.
shanghai has a population of 20 million , how much of them have a salary of 500,000RMB/year ? can you tell me ?
the common people are suffering hardly from the increasing price of houses and foods , the rent price of my apartment have increase over 50% percent in one year , the price of meat increased over 100% than a year before , how could you say Chinese people is richer ?
this is a year of change , but most of us can't see much light ahead , next year would be harder for chinese people , olympic games has become a sensitive subject we can't talk about much now
actually, i'm really a little disappointed at your words.
Posted by: 且听枫吟 (external link) on December 17, 2007 6:28 AMWhen you say 500,000 Yuan a year, is that before or after taxes? Is 500,000 the take-home pay?
I make $125k a year pre-tax, but after paying almost $45k in federal and state taxes, I only get to keep $80k. That's a big difference.
Another thing I noticed when I was in China three months ago, everyone talks about how much money their adult children are making. Is that weird?
Posted by: Давид on December 17, 2007 8:13 AMWhen you say 500,000 Yuan a year, is that before or after taxes? Is 500,000 the take-home pay?
I make $125k a year pre-tax, but after paying almost $45k in federal and state taxes, I only get to keep $80k. That's a big difference.
Another thing I noticed when I was in China three months ago, everyone talks about how much money their adult children are making. Is that weird?
Posted by: Давид on December 17, 2007 10:12 AMThere is an economic path to greater freedom. That is good news to countries that can not change their politics quickly.
Posted by: poetryman69 (external link) on December 17, 2007 7:06 PMThe conflict between the rich and the poor in China has become so disharmonious. Wealth is not your fault, but this article is.
Posted by: fqh (external link) on December 17, 2007 10:03 PM且听枫吟, perhaps JianShuo should say annual salary of RMB500,000 or more is not unheard of in Shanghai, I do know there are lots of people in Shanghai have income more than that, but may not from salary, it also includes bonus, commission, profit, capital gain etc. otherwise how do you expect people can afford to buy luxary condominiums and cars with only miniscule income?
Take China Mobile for example, its reveune reached US 33 billion, what remuneration do you think is appropriate for her CEO and his management team?
This is not the era of People's Commune!
Posted by: stephen on December 18, 2007 6:11 AMIt's a wild wild world in China. It's not a place where you can judge based on historical experiences of other countries.
The environment which China is in now, is so different than the old days. Internet, globalisation, innovative financing tools, different mindset/needs of the societies....
I believe the world, not China alone, is a timebomb itself. Hopefully, it won't explode someday.
Amen!
Posted by: whling on December 19, 2007 3:54 PMThe extreme income gap and the need of the nouveau riche to flaunt their wealth may just lead to another revolt. We are not that different from the 1930's.
Posted by: wonton on December 20, 2007 4:33 AMi guess what jianshuo referring is the income at his grade or level. i also concur with stephen, 500k rmb /yr is not uncommon rather than popular.
Posted by: siegfried on December 22, 2007 12:03 AMThe calculation is wrong, 500K RMB is less than 70k USD. Also jianshuo is comparing apple with orange here. People earn 500k RMB in China must be in senior management or have their own business. But 70k USD is what Microsoft offers for an entry level programmer job. People in senior management get paid for at least 200K USD plus big upside bonus in US.
Posted by: cw08 on December 22, 2007 1:51 AM@cw08, yes, I am comparing apple with orange here. My point was, the common perception by a lot of people is, foreigners always earn more than local Chinese in Shanghai, which is wrong. Senior local people earn much more than junior foreigners. I am not so stupid to make a conclusion that people in China has already earn more than developed countries, but the trend is, the gap is getting closer.
Posted by: Jian Shuo Wang (external link) on December 22, 2007 9:38 AM