Companies in China are struggling to retain their professional and support staff and face either having to pay higher salaries or excessive recruitment costs.

Research by Mercer Human Resource Consulting shows that 54% of more than 100 organisations in China have experienced an increase in turnover for professional staff since last year, with 42% have reported higher turnover for support staff.

The survey also reveals that the average tenure for 25-35-year-olds - the age group targeted most by multinational companies - fell from an average of three to five years in 2004 to just one to two years in 2005.

Brenda Wilson, principal at Mercer, comments: “The employment market in China has ignited in recent years, as more multinational organisations set up operations there and local companies expand. Individuals with transferable skills have become a valuable commodity, and companies are battling to keep hold of them.”