Tech firms struggle to keep Chinese staff

By Astrid Wendlandt

PARIS (Reuters) - Holding on to skilled staff in China is getting as hard as protecting intellectual property for Western technology and media firms, executives told an industry summit this week.

Poaching is rampant.

Long considered a low-cost manufacturing center, China is increasingly offering specialized skills that foreign companies are keen to tap.

"The biggest problem we have there is that they are taking people -- Chinese people we train, people we send," Robert Lerwill, chief executive of UK media group Aegis AGS.L told the Reuters Global Technology, Media and Telecoms Summit in Paris.

Aegis, with 1,000 staff in China already, is among those companies looking to expand operations and development facilities to be closer to customers in the world's biggest consumer market and to acquire local knowledge.

"There are big skills opportunities in China. One of the shortages in this world is highly skilled, capable engineers and there are a lot of them in China," said Miles Flint, President of phone maker Sony Ericsson (6758.T: Quote, Profile, Research, Stock Buzz)(ERICb.ST: Quote, Profile, Research, Stock Buzz).

"It is an attractive location for value creation not just for cost avoidance," Flint added.

JUMPING SHIP

But competition for talent is fierce and Chinese employees readily jump ship. Executives said hiring graduates fresh out of school was easy. The difficult task was finding experienced staff, particularly managers.

"To find top management, middle management so that you can control and guide them is not quite so trivial," said Gerhard Florin, Executive Vice President of Electronic Arts (ERTS.O: Quote, Profile, Research, Stock Buzz), the world's leading video game publisher.

Electronic Arts said it had 130 people in China and would hire more to boost its online gaming operations there.

Executives said hiring in China was more a strategic than a cost-related move, though researchers there still tended to still be cheaper than India, where employees are closing the gap with Western counterparts after 10 years of TMT investment.

"We have been doing some research and development in Bangalore and increasingly we will be doing it in Shanghai," said John Scarisbrick, chief executive of British-based Bluetooth specialist CSR (CSR.L: Quote, Profile, Research, Stock Buzz).

He stressed that his company was more motivated by talent than cost.

SOME WARY  Continued...