Is China becoming a threat to Silicon Valley in the talent war?

In 2018, China made giant strides in the technological sector. Industry observers have also reported that China has been luring talent away from Silicon Valley. However, it remains to be seen whether Silicon Valley is under serious threat.

Is China becoming a threat to Silicon Valley in the talent war?

9 May 2019 by  Ravi Nippani

For the past few decades, Silicon Valley’s status as global technology hub has attracted top technical talent from all around the world. However, Silicon Valley’s appeal may be under threat given China’s rapid technological progress in 2018. China’s prowess was reflected in MarketWatch’s list of the biggest tech companies – which includes 11 American companies and nine Chinese companies. The World Economic Forum also launched a Beijing hub to shape future tech policies, which has strengthened China’s global influence.

Furthermore, industry observers have noted that China has been luring talent away from Silicon Valley, with Bloomberg stating that “U.S. Faces ‘Unprecedented Threat’ From China Tech Takeover”1, and The Wall Street Journal reporting that “China Mines Silicon Valley for Tech Talent”2.

Silicon Valley and China want talents with different skills

The reality however, may not be as simple as the headlines. According to recent surveys conducted by Radford, part of Aon, technology companies in the United States and China are seeking talent with different technical skills. These in-demand skills are known as hot skills, and in the US the top three are Cybersecurity, Information Security and IT Security Operations. In China however, the top three hot skills are Data Science/Big Data, Artificial Intelligence, and Data Visualization. It is clear that the two giants have different focuses, with the US betting on security and China ramping up on intelligence.

But there are some overlaps

Despite the different technological focuses, it may be premature to conclude that the two giants are not rivals in the war for talent. If we look at the top 10 hot skills, there are some overlaps–namely Data Science/Big Data and Cloud Engineering.

Skills such as Data Visualization and Auto Pilot also command huge pay premiums in both markets; up to 14.9% in US and up to 28.5% in China. Apart from higher pay premiums, tech talent in China can also look forward to generous bonuses, profit distribution or excess profit sharing. China’s propensity for a cash-focused compensation strategy could prove to be Silicon Valley’s Achilles heel if they are competing for the same talent.

Beyond technical skills, soft skills are also in huge demand in both Silicon Valley and China. This includes problem-solving capabilities, leadership qualities, high emotional intelligence, good written communication skills, strong negotiation skills, as well as the ability to work well in teams.

China is closing the talent gap

It has been four years since China launched “Made in China 2025”, an initiative designed to reduce China’s dependence on imported technology. This means increasing China’s technological competitiveness, which can only be accomplished if the tech workforce in China has the skills to compete with Silicon Valley. In these four years, with support from the Chinese Government, China has made significant strides to close this talent gap.

But the question remains: Is China becoming a threat to Silicon Valley in the talent war? Or perhaps even as a global technology hub? As Murat Sonmez, the World Economic Forum’s head of the Center for the Fourth Industrial Revolution, says, “China represents a huge opportunity for the rest of the world to see what’s coming.”


1. Bloomberg stating that “U.S. Faces ‘Unprecedented Threat’ From China Tech Takeover”
2. The Wall Street Journal reporting that “China Mines Silicon Valley for Tech Talent”

Ravi Nippani

Radford partners with technology and life sciences companies to reimagine their approach to rewards, empowering them to achieve superior levels of people and business performance. Radford is part of Aon plc (NYSE: AON).

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Ravi Nippani
Ravi Nippani
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Alexander Krasavin
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