The Shanghai Expat Package – Whats your worth in Shanghai ?

Shanghai Living

Source of intrigue, jealousy and often downright bitter resentment: the ex-pat package. It’s the subject of hearsay and Chinese whispers and someone else has always got a better deal (or, in the case of journalists, everyone else). We’ve all heard tales of the company who caters for every whim – from the villa accommodation right down to your dog’s diamond collar. But the times they are a-changing in Shanghai – and so are the expats who work here.

Ten years ago a traditional employment contract would have likely included regular R&R (rest and relaxation) trips to the nearest comfortable place to recover from the ‘horror’ of Shanghai. Today, with a Starbucks on every corner, fine wines in every restaurant and a Zara in every mall, this city is no longer such a stressful place to live. “The R&R trips are virtually non-existent in Shanghai today,” says Kate Lorenz, Managing Director of Ark International, an orientation and housing company. “It isn’t the hardship posting it used to be and we’re seeing many of our clients downgrade the city’s rating as a difficult place to live.”

Downgrading the city isn’t simply a way for companies to pay their employees less, though that may be the end result. It is supported by a wave of willing expats who are actively seeking to come here and don’t need the traditional enticements offered in the past. Such expats bring competition for jobs and consequently cuts in packages. For many mid-level employees looking to take a step up the career ladder, Shanghai is the perfect opportunity; people are swapping the package for a promotion.

That’s not to say employment packages no longer exist. Other than the R&R trips, Lorenz is not seeing swingeing cuts but witnessing a more subtle change.

“More people are becoming what we call half-pats: they take a monthly lump sum with which they pay their own accommodation and school fees and whatever else. Employees can make their own decisions about what to prioritize and the company invariably saves money.”

The willing half-pat package

Beverly Burgess, Regional Marketing Manager for eBay Beverly willingly moved from Sydney to Shanghai in early 2019. “The economy wasn’t doing so well in Australia and so I was looking to move somewhere more prosperous.”

Package includes:

  • Full health insurance, including maternity if needed
  • A look-see trip to check out Shanghai before committing to coming
  • 25 percent of salary paid as a bonus to cover accommodation and any other additional costs
  • All packing, shipping and storage
  • One economy flight home each year
  • 40 hours of Mandarin lessons

This is the path that eBay has taken in China. “We don’t offer a standard expat package,” says Jing Huang, head of human resources for eBay in China. “Each individual is offered a tailor-made deal, usually with a transition bonus that takes into account their level within the company and situation in their home country.”

Employees with families are a particularly expensive option for companies, because they require additional health insurance and school fees. Anna Wethered, China Country Manager for Orientations, a global relocation company with offices in Shanghai, says she has noticed a recent change in the expat demographic coming to the city. “It’s hard to know how much what we’ve seen is a true indicator, but anecdotally it would seem companies are, where possible, opting to employ people who don’t come with two children and an RMB400,000 school fee bill.”

The School Teacher package

Mr. X Teacher at Shanghai American School Mr. X wishes to remain anonymous. “Our package is extremely generous. My salary is similar to back home, but all the added extras mean I save much more.”

Package includes:

  • Salary RMB 350,000
  • Accommodation at Shanghai Racquet Club
  • Full healthcare, including maternity cover
  • One economy flight home each year
  • A place in the school for up to three children
  • One-off relocation bonus of RMB35,000-55,000 per couple or RMB14,000-28,000 for an individual
  • Shipping allowance of RMB8,000-10,000
  • Fitness allowance of RMB7,000 per year

Another recent phenomenon is an increase in ‘localization’ packages where employees are offered a contract with benefits gradually stripped away as they get used to living in Shanghai. This might mean that accommodation is paid for the first year, half-paid for the second year and then not paid at all after that. “We have seen a huge growth in localization packages over the past couple of years.

Companies recognize that setting up here is still a difficult task for families, but aim to reduce the costs for the company over the long term,” says Wethered. But what of that vast shapeless destroyer, the global recession – how is this affecting Shanghai? Wethered wonders if it’s had much impact. “We have heard a lot of talk about plummeting rental prices and swathes of expats returning home, but this isn’t the reality we are experiencing,” she says. “A handful of people bagged a good deal, but by and large rentals have remained stable – particularly in the popular expat areas like Jinqiao. Already this year we have seen around a 15 percent increase in rental prices.”

The opportunist expat package

Bevis Jones Visual Effects Supervisor, Bevis moved from London with his family last August. “I came here because of the opportunities that simply aren’t available back home. I pay school fees of RMB200,000 a year out of my own pocket.”

Package includes:

  • Salary RMB 440,000
  • Health insurance for whole family
  • Economy flights home once a year
  • RMB4,000 towards accommodation
  • Optional Mandarin classes during work hours.

The schools, often a reliable litmus test for the health of the expat economy, seem to tell a similar story. Harlan Lyso, Superintendent at Shanghai American School, believes the international schools all took a bit of a hit in terms of numbers, but most have recovered quickly.

“We are already back up to 2018 figures and we are projecting that the 2019/2020 school year will see our highest enrollment yet,” says Lyso. SAS sees the situation from both sides of the coin, as it is currently also China’s biggest expat employer, with more than 300 overseas staff on the books. “We are not cutting back what we offer staff,” says Lyso. “This year we have increased teachers’ salaries by four percent and maintained a comprehensive employment package.” He believes these steps are necessary to attract the very best teachers and therefore keep numbers high.

Full expat relocation package

Mr. X Engineering Senior Project Manager Mr. X wishes to remain anonymous. “I think we get a pretty good deal. I don’t know how it compares with others.”

Package includes:

  • Salary RMB525,000 Lump sum mobility premium 25 percent of salary
  • All-inclusive health insurance
  • Accommodation RMB25,000 per month, plus utilities School fees
  • Car and driver RMB15,000-20,000
  • Tickets home for all the family once a year
  • One month’s salary mobility bonus on arrival and on departure
  • Appliance allowance RMB20,000 Pet relocation RMB28,000
  • One hundred hours of language lessons
  • Orientation visit Packing service and shipment of all household goods
  • Spousal allowance RMB17,000 for training or job search costs

A recent HSBC report looking into expats’ finances across the globe reported that 30 percent of expats in China have scaled down their spending on essential day-to-day items. This sounds like a significant belt-tightening, but when you compare that with the 79 percent in the US or 75 percent in the UK, China doesn’t look so bad. In fact, HSBC rates China as number 11 out of 26 in the top locations for global expat finances. The scale is worked out by a combination of expat disposable income, savings and luxury items owned. Russia was listed as the number one place for an expat to make money and France was at the bottom at number 26.

The Expat Doctor Package

Dr. Gregg Miller Emergency Physician, Shanghai United Family Hospital. “Expat doctors often make less money here than in their home country. I make two-thirds of what I did in the US. Doctors come here for the experience or as trailing spouses, not to make money.”

Package includes:

  • Health Insurance
  • Economy flights home once a year
  • No accommodation or school fees

Today in Shanghai we are seeing a more integrated expat population, not simply confined to compounds and chauffeur-driven cars. Part of that is to do with the sheer volume of people coming to the city.

In the top-level jobs these packages still exist, but what we are seeing now is companies expanding and offering more mid-level positions.

The lavish packages haven’t disappeared; they have simply been watered down. “A company bringing in a top level executive is still going to have to provide a package to suit – and that includes an RMB70,000 per month villa, a car and driver and all the trimmings,” says Lorenz. “But the reality for most people is that expat packages have changed forever.”

I won’t come unless….

Real deal breakers we encountered:

  1. “… I can bring my horse and parrot.”
  2. “… you ship over my Harley-Davidson.”
  3. “… there’s a grand piano in my apartment.”
  4. “… you move the kitchen sink – it’s bad feng shui.”

So it’s true, the heyday is seemingly over. But before you tear up your expense claims and board the next fight home, take a minute to remember why so many of us are still here: super Shanghai, we love you.

8 thoughts on “The Shanghai Expat Package – Whats your worth in Shanghai ?”

  1. Hello, I have a double bachelors degree in economics and Government/international relations from a good American university and I’m given the opportunity to come to Shanghai to study mandarin for a year. I could also possibly do my masters degree if I find an adequate school for me. However, I’m wondering if I will be able to find a good job, or part time job in the local industry while I’m studying the language or while I’m doing my masters next year.

    I wanna work in the banking system or the businesses/big corporations or in the NGOs. Is there any chances?

    Ps: I’m black African, dunno if it matters but I heard Chinese people could be very sensitive to skin color or origins.

    • ” I wanna work in the banking system or the businesses/big corporations or in the NGOs. Is there any chances?”

      No chance working in banks here in China. Chinese banks do not hire foreigners. I cover this sector for a living and it is all “haigui” Chinese returning from overseas. Not a laowai to be found. Big corporations? Not likely, as most big multinationals are sending home their expats. The China “boom” has gone “bust.”

      NGO? This is the sector I know -nothing- about so I cannot comment. I don’t think that there are a lot of NGO’s in China. In China EVERYTHING is by definition a government entity. There are groups like AMCHAM which is an NGO but they are limited.

      If you can afford to come to China for a year and simply enjoy and learn then great. You will profit greatly in life from your time here. If you need to work and are planning long term then please reconsider. You can always make a few extra RMB teaching English to students while you study but that is really only beer money.

      I have experienced your predicament first-hand with MBA students I’ve associated with. Classes from 2017-2018 wanted to stay and find jobs in China…..none found jobs. Classes 2018-2019 simply came, learned and found jobs elsewhere because they learned from the earlier classes.

      I’m sorry if this is not what you want to hear but its true. Come, learn, enrich yourself, but plan to go home.

  2. You are right about banking or investment finance in general, it’s very localised. Unless you are Chinese and have some pull it’s impossible to get into. There are some opportunities for foreigners to get into investment research in offshore shops, which I guess what you are doing since you are “covering” banking.

    as far as MNCs go, it’s still feasible to find decent jobs there. You will probably make 30% of what you would make back home at the entry level, and about 75% at the mid management level of similar role back home. Obviously, it’s not as easy and language is a factor as well.

    MNC corporations sending their “expats” who are sitting on “expat” package home, that’s true. But there is still need for foreign talent at mid levels if you are willing to work for a bit less as mentioned above.

    Not sure which MBAs you are talking about but I have quite a few foreign friends with MBAs class 2018 and 2019 who were able to find nice gigs in Project Management, Real Estate Development, Sales and consulting jobs. Some of them (actually, most of them don’t speak Chinese at the level they can use at work)

  3. My husband received his relocation package today to consider and respond. He will work in HuangPu in Puxi for a three-year assignment. Housing is $9600 per month and utilities, phone and internet paid by company; car with driver $59K; paid schools; full paid medical; moving and storage $10K (I assume for the three year assignment); settling allowance of $8,900; one company-paid home leave (coach class) per year. Visa paid by company, relocation assistance on-site, one month temp accommodaton while looking for house. Domestic help (ayi, security, gardening) on our own account.

    We live in the suburbs of NYC in New Jersey and have never relocated! My daughters are 6 and 8 (from China so we have been there before but not to live!). So far I have contacted SAS and they have seats (at the moment) in 1st and 3rd grade in Pudong. Also considering SCIS. Not sure if we want to live in Puxi or Pudong yet. Haven’t made a look-see visit yet and hoping to negotiate that into contract.

    So, is this contract typical? What kind of housing would we get for $9K a month? Looking for a 4 bedroom and yard/garden-hoping to bring our dog (all 12 lbs!). Was just looking online at Greenhills in Pudong. Is Willowbrook part of Greenhills or a separate complex?

    I am sure I will have more questions. I am shaking as I type I am so nervous about all this! Any advice, good or bad, is greatly appreciated! Thanks.

  4. If you don’t snap this up in a hurry, your husband’s company can find dozens of people with your husband’s qualifications that would jump at a much smaller relocation package within 48 hours of letting out the word of what they are looking for. Sounds like your husband’s company either has a huge amount of loyalty toward your husband, is too lazy to advertise the position or you are lucky that they are using outdated information to offer this kind of a package. These dream packages are now few and far between. As an employer, this is certainly well beyond what we would offer in today’s market.

    There are always exceptions, of course, and maybe your family does meet exceptional circumstances that require this kind of treatment.

  5. Willowbrook is the newer phase of Greenhills. This is a very nice community with big houses and gardens. It is in Pudong, so a communte to Puxi will be a little rough for your husband.

    Willowbrook / Greenhills is in JinQiao – a very nice Pudong suburb. There are 2 good international schools right at its doorstep – Dulwich, UK system; and Concordia, US Christian based school. Both usually have waiting lists. SAS is a good bus ride away as is SCIS… but both of these are US system and are not religious. My friends as SCIS LOVE this school (except for its location).

  6. I highly recommend to come out and do a preview trip. It was very helpful to my family to see the schools and housing options, in person, as opposed to on the web. What you see on the web and what you see in person can be very different.

    Even after a few days here we quickly realized that for ourselves, Puxi (French Concession) was the area of the city that appealed to us most and is where we chose to live. Prior to the preview trip, based on office location, we were thinking we would live in Pudong. The preview trip ensured we made the right decisions.

  7. That’s a good package, I’m assuming that his yearly salary is $59K, is that paid in RMB into a local account, or in $ to an overseas account ? there are many posts on this issue, you might have to consider FX fluctuations.

    $9k a month will get you a great place, if $59k is his yearly salary, considering the rest of the package, the salary seems a bit low although I don’t what job he is going to do. As the rent will be dead money, have you considered asking for a higher salary, but a lower housing allowance ?

    I don’t have kids, but you say that the schools will be paid for, are there any limitations in their offer, such as a maximum schooling fee ?

    settling fee of $8900 is great, driver and car good, medical good, $10K shipping costs, all sounds great, can’t think of anything else you really need.

    really these kind of packages are few and far between, but of course it depends on what your husband can offer the new employer and how much they want him.

    would recommend you come for an inspection visit, though you have a lot of choice with $8900 per month and they have agreed to pay for a hotel for the 1st month so you would have enough time to find a place. we have nowhere near that allowance, nearer $4000 and we got a 3 bed 2br apartment in changning district in a nice compound, our company paid for a hotel for upto 3 weeks and we moved into our place within 2 weeks of getting here, though I did take 2 days of work and blitzed the place.

    I would definitely use an agent, make a list of your “must haves” and “like to haves”, tell them the areas you would like to live (dictated by location of school and work), if your company has a preferred agent give your requirements to your HR dept and be very clear in the type of place you want otherwise they will take you to places that just waste your time. Don’t assume they know what you want.


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