Fringe benefits and loyalty on the Chinese labour market – a trend towards higher individual‐ and performance‐orientation

Abstract

PurposeThe labour turnover rate is in general 10 per cent in China. Although this rate is especially high for blue collar workers, fluctuation among qualified employees and managers is high as well. As a result, the economic development has led to high competition on the Chinese market. Moreover, companies also have to deal with lack of employees – especially highly qualified ones. The purpose of this paper is to figure out the impact of fringe benefits on the labour turnover rate of Chinese professionals.Design/methodology/approachThe study subjects were 14 managers working for private companies in the Shanghai region. The authors conducted semi‐structured interviews as the primary data collection procedure to investigate reasons, opinions, and views about fringe benefits and employees' loyalty to their organisations.FindingsThe paper outlines highly diverse perspectives about fringe benefits. Furthermore, the authors show a series of reasons for labour turnover and motivators of Chinese professionals.Originality/valueThis paper contributes to the compensation literature by analyzing the relation between fringe benefits and loyalty of Chinese professionals. Moreover, it shows to what extent fringe benefits influence labour turnover in China. It also presents the preferred fringe benefits of employees in Chinese companies.