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October 8, 2016

Making the Jump – Living in China Full Time

by mikediliberto

Of the countless things on my to-do list (Wunderlist, in case you were wondering), writing a book to pull together my decade of China manufacturing experience is high on that list.  When the urge hits, most times on a long train ride or in the back of a minivan somewhere in China, i pull out my phone and make notes (Evernote), sometimes short sometimes long, and then later I come back to the random pile of notes and start organizing.

Lately in my editing I’ve been pulling out chapters here and there and thinking that they would make a good article on their own.  The article below is in that category, the start of a series of chapters on the considerations and practical implications of moving to China to live as an expat.

It was many years of traveling to China regularly before I made the jump to living there full time.  After those years of travel to China, and having studied in Beijing, I thought I had a pretty good idea what I was in for.  Not to say that I didn’t, but having a tiny grasp of Chinese culture and some bits of language are really only a small part of the complicated existence of an expatriate. In the end, only you can answer the question of whether moving to China is right for you; As I often advise our clients, I don’t have the answers, all I can do is ask the right questions.  In this article I’ll ask all of those questions that I wish someone asked me before my wife and I decided to move full time to China.

Take Stock

First and most importantly, what is your life situation? Do you have a wife and kids? Just a wife? Unattached? In the former case, having kids in tow will heavily weigh on your decision to make the move to China, but it is certainly doable, so long as you’re moving to a city that can accomodate your family (more on this below).  I have lots of friends whose children have grown up in China’s network of international schools and most will tell you that it was a great experience.

One of the most important considerations is where you will be living in China.  Some may argue this point with me (especially some of friends in local government offices) but in China, cities can be divided into to “Shanghai” and “cities that are not Shanghai”.  Don’t get me wrong, there are some amazing cities in China, and I travel to many of them in my work in sourcing. That being said, Shanghai is kind of like New York City; it’s a place that will eat you alive if you’re not ready for it, but many people move there to pursue their dreams of making it big.  Thus, like New York, the survivors in Shanghai tend to be a rather hearty bunch. Shanghai also lays claim to what is, by far (I can’t underscore this enough) the greatest talent pool in China to pull from.  Also, it’s a sellers market for talent in Shanghai, so you’re going to have to compete for white collar talent there;  heaven help you if your office is too many subways stops away from downtown, let alone in another city or province.  Shanghai attracts top talent, and therefore attracts multi-national (and increasingly, domestic) firms that need those talented individuals to be successful in China. Don’t expect salaries to be any lower than the salaries you pay back home, and in some cases more.  Remember your firm is up against many the others in this race for talent, and you’ll soon be sympathetic to the plight of the tech firms of Silicon Valley.

Similarly, Shanghai attracts, (click here for a great map of China by expat population) the lion’s share of expats in China, at least when you take geography into consideration (Guangdong has more expats but they are more spread out). What this means is, Shanghai boasts the highest quality of life, the best hospitals (with English speaking doctors), international schools, etc.  Other 1st tier cities will have some level of services for the expat community, but to a far lesser level.

Remember that, given China’s extensive high-speed rail network, it is actually possible to commute from cities that are hundreds of miles away.  I have a few friends that live with their families in Shanghai but work in Hangzhou or Suzhou (both under 1 hour away by train).

In my career, I’ve managed teams of people whose job it is to split their time between their home country and China. Most of them are product or project managers, but in any case, people that, when in China, spend a lot of time guiding our factories into making the right products according to the agreed-upon schedule.  My advice to them during on-boarding is this: You will very quickly develop a sixth sense for when you need to get on a plane to China. You’ll have this small twinge of doubt or nervousness that will feed a little voice that says “you know, maybe we should go over there and just make sure everything is going ok”.  My advice is, always, always, always listen to this voice and take any doubt as to whether you need to be there as an affirmation of the same.  You will know when you need to go, I tell them, and my job is to support you.

So to you I offer the same advice.  If you have that feeling, that thought, that urge, pushing you to move to China, the best advice I can give you is to listen to it. It’s never an easy decision, and life on the ground is usually not what you imagined it to be.  All the same, if your instincts tell you to get over here, then you should probably listen.  Remember, you always have the plan B of returning home (more than half of all expats in China return home earlier than planned).

Before you get on the plane, lets look at a few specifics you’re going to want to work out before you leave.

I am going to assume, for the sake of this discussion, that you’re working for or considering working for, a company that has offered you an opportunity take an expat post overseas.  As with any business discussions, it behoves you to start writing down the terms of your relocation in at least a simple contract that both sides will sign before you start packing up your things.

First and foremost, visa regulations are ever-changing, especially when it comes to expat resident permits in China. You’ll need to engage in the services of an expat relocation firm to determine if you meet the minimum qualifications (degree, years of work experience, etc).  Assuming they give you the green light, you’ll want to know about how long it will take, once you arrive in China, to complete the work permit and residence permit process. I put together a basic guide to Visas and posted a table showing the steps involved in becoming a resident in China. As always, subject to change, your mileage may vary. I’ll shy away from recommending specific firms at the moment, but I will recommend that you reach out to the nearest branch of the American Chamber of Commerce in the city that you are considering.

Transitional Accommodation: The first item to add to your contract is the need for temporary accommodation until you have a valid residence permit.  Although you can rent an apartment with just a standard work visa to China, I do not recommend you do this, as failure to receive the residence permit is going to cause you to break that lease. Be careful with simply stating “Hotel accommodation, four star or better” as hotels in China give themselves their own star ratings, so you’ll regularly find awesome two-star accommodation and similarly four star hotels with moldy walls. Stick to the Western brands. Expect the process of applying for and receiving a resident permit to take 30-60 days, sometimes more.

What-if: Though rare, be sure to put in contractual obligations in the case that your resident permit application is denied.  As I mentioned, regulations are changing, so I expect to hear of these issues happening more and more as time goes on.

Healthcare: This could be a chapter on it’s own (It likely will, now that I think about it) but suffice it to say that expats need to pay for their own healthcare in China.  Plans vary in pricing and features, but expect costs of five to ten thousand dollars per family member per year.

School: If you have school age Children that need international education in China, prepare for sticker shock.  Per enrollment you’re looking at ten-thousand to twenty-thousand or more per person per year.

Heed this advice: The golden week holidays are NOT the time to explore China. Plan to leave the country during this time

Heed this advice: The golden week holidays are NOT the time to explore China. Plan to leave the country during this time

Travel home: Being an expat is hard, not the least of which because we are away from our extended families. Any decent expat package should include a number of round-trip flights for you and all of your family members; two sets of holidays that you should be discussing: US holidays and China holidays.  Being home for Thanksgiving and Christmas can make all the difference in the world to a successful expat experience. Secondly, China has two so-called “Golden Week” holidays, October 1-7 and Chinese New Year, the dates of which vary but always a seven day period.  You’ll want to be out of China during these periods as well.  If you really only work in China, then these holidays may be best used to explore Asia (there are some awesome places to see while you are here in close proximity); you might also negotiate with your company to return back to their headquarters to work through the Chinese New Year there.  Again, we could spend a whole chapter on this, but Chinese New Year, despite only being a week long, has a 30-40 day impact on Chinese business, as most employees take extra weeks at the same time to turn 7 days off into 21 or more.

Cost of living: Do not for one second believe that because China has a perception of being “low cost” that the cost of living here is cheaper than back home; quite the opposite.  Unless you’re moving from Tokyo or New York City, buckle up.  First and foremost, apartment costs in most major cities vary considerably; Shanghai has some ok apartments for $750 per month and up; a two-or-three bedroom will run into the few-thousand per month territory, and I have more than a few expat friends that pay double and triple those figures.  Similarly, food and daily essentials are going to cost a lot more compared to American prices; brace yourself for thirty dollar bottles of tide detergent, seven dollar boxes of mac-and-cheese, and hundred-dollar (uncooked!) steaks.  With food safety a top concern, grocery shops and delivery services in China that cater to expats import foods and charge wince-worthy prices.

Driving: Your driver’s license from back home is no good here.  To drive in China, you’ll need a Chinese Driver’s license.  While you can study for, and take the test in English, it will take some time.  Plus, you’ll likely not have a car when you get here (you can buy one and plan to sell it when you leave, but again, there are costs to consider).  So, at least at the start you’ll be carless, which, while it is an advantage in downtown Shanghai, it can become a challenge even for simple things like grocery shopping.  Whether you negotiate for the services of a private car and driver or taxis, transportation costs can add up fast.

Language: You’ll probably want to learn at least a little Chinese to get by over here.  Expect most classes to run $15-$30 per hour.  I found that three times per week in the morning before work was about as much as my brain could handle.

Still with me? Good, there’s hope for your future as an expat in China. My advice now is to make good use of google while you still have it, and read what others are saying about life over here.  Shanghiist, The Beijinger, City Weekend, and Shanghai Expat are are in my regular rotation for news and conversation about life over here.  As always, drop me a line anytime at mikediliberto (at) gmail.com

 

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