In recent years, more Chinese nationals completing their studies overseas choose to return to China, and Shenzhen is one of their top destinies. Compared to other cities in China, Shenzhen particularly attracts knowledge workers in the Internet industry. Tencent, the Internet giant headquartered in Shenzhen, is the most attractive employer among overseas returnees. Alibaba Group, founded by Jack Ma, is second and Huawei is fourth. Bytedance, Tiktok’s parent company, is fourteenth. Table 1 shows that the top 15 employers are all Chinese companies, many of them are technology enterprises which indicates the attractiveness of Chinese Internet companies among overseas Chinese student returnees. Chinese companies such as Tencent have offices in both Shenzhen and Beijing which provide returnees with the flexibility in choosing their preferred work location. One Tencent employee I had an interview with chose to work in Tencent Beijing office after her return from the UK because of her interest in Internet policy research. Tencent Shenzhen headquarter focuses on Internet product innovation and software development, while its Beijing office emphasizes on policy, intellectual property, and legal research, with the utilization of Shenzhen and Beijing’s respective locational advantages.
Overseas Chinese students’ increasing return is intertwined with uncertain geopolitical tensions China has faced overseas. As of October 2020, in the midst of COVID-19, about two-thirds of Chinese students who studied in the USA, UK, or Australia had returned to China. Three-fifths of them hold at least a master’s degree (He, 2020). The online career development platform UniCareer found a 70% increase from 2019 in terms of the number of overseas Chinese student returnees. The COVID-19 pandemic and tightening immigration and employment rules were the major reasons (He, 2020). For example, US Optional Practical Training (OPT), a post-graduation work permit that allows international students to legally work after they complete their studies was to be suspended by the Trump administration, threatening Chinese and other international communities. Some Chinese students, who are faced with the unpredictable circumstances, now depart for China immediately after their study. They do not want to miss the job recruitment cycle in China. Figure 2 shows that the denial rate of H-1B visa petition increased from 6% in 2015 to 29% in 2020. The H-1B program allows “companies in the United States to temporarily employ foreign workers in occupations that require the theoretical and practical application of a body of highly specialized knowledge and a bachelor’s degree or higher in the specific specialty, or its equivalent.”Footnote 14 The H-1B denial rate is an indicator of hardship that foreign nationals face if they seek further training or want to pursue careers in the USA at present.
As obtaining post-graduation work permits and H-1B work sponsorship becomes more difficult, the number of overseas Chinese students returning to China after graduation is increasing. “There are many more opportunities in China” is extremely popular sentiment among entrepreneurial overseas returnees. There are currently two categories of oversea returnees: one seeking work with employers in China, the other focusing on creating businesses in China built on their international visions and the advantage of massive Chinese market potentials. Ranked as the no. 3 overseas Chinese students’ destination city (see Fig. 3), Shenzhen city government subsidizes returnee entrepreneurs with an amount of 500,000 RMB (74,117.30 USD), 250,000 RMB (37,058.65 USD), or 150,000 RMB (22,235.22 USD), based on their educational attainments and potential to welcome business creations and talent. Preferred industries for funding include information technologies, new materials engineering, new energies, biomedical engineering, advanced manufacturing and equipment, modern agriculture, clean-tech, and professional services such as logistics. The startup funding that entrepreneurial overseas returnees receive is far less than the financial resources and housing awarded to Peacock Talent. One entrepreneur at a coworking space who attended high school in the UK and university in the USA stated, “Shenzhen government is very supportive. It is possible to use the government startup funding to purchase several office computers to get a company started” (Interview, 2019). Once considered as a “second rich generation,” he seems to have reintegrated into a unique Chinese business environment, which requires him to play it well with the government by reenforcing the positive role government plays. Unlike overseas talent or transnational entrepreneurs lured back by the city government, he quit his job in finance in Shanghai before pursuing his entrepreneurial ambitions in Shenzhen. His major motivation for entrepreneurial pursuit was to make more money than what he got paid for working for others. Also, he wanted to prove to his parents that he could make his own fortune. In a follow-up phone interview, he expressed his frustrations on not knowing why American employers did not hire him: “Maybe because of language, cultural barriers, or unwillingness to sponsor foreigners. Who knows? No employer explained to me why they did not hire me” (Interview, 2020). His mention on the unwillingness to sponsor foreigners is worth pointing out as it is reported by several people that lack of sponsorship is the main barrier for foreigners to get a job in the USA (Interview, 2019).
Overseas returnee entrepreneurs, who hold advanced degrees such as PhD, tell a different story. Founders from a medical data startup founded in Shenzhen in 2019 by three US overseas returnees are optimistic and positive about their startup’s growth and development. “My other two co-founders are all male and received their PhDs in bio-medical engineering and statistics from renowned American universities. It is easy for them to get jobs in the United States in relevant industries. But, is it boring to just live a middle-class American life when you have the chance to be a first-mover startup founder in your field in China?” A female entrepreneur shared her entrepreneurial journey and enthusiasm with me, “In just two years, our startup has started to make promising revenues. We did not go through venture capital, instead, we simply applied 2 million RMB Peacock Talent government money to establish our company two years ago.” However, it is not easy for all top-notched overseas returnees to achieve business success like they do. One key obstacle, some of them are faced with, is counter-cultural shock. The female entrepreneur further shared, “to be honest, some overseas returnees are too arrogant and proud of themselves. They consider themselves as elites who hold state-of-the-art technology, patent, and knowledge that they obtain from their PhD training. But, in Chinese business culture, most of the time, it is not necessarily your technology but your personality, your character, and your connections gain you the first business deal” (Interview, 2021).
Despite Shenzhen city government’s efforts to attract overseas talent, many overseas Chinese students prefer Shanghai or Beijing. The lack of fine museums, theaters, or entertainment channels is one major complaint. Cultural facilities are a weak indicator in Shenzhen’s overall city attractiveness. The city’s percentage of “highly educated people among permanent residents” also counts as a disadvantage for returnees. Shenzhen college town (Xi Li College Town) is on the edge of the city and county areas. Some overseas returnees, who became professors in college town universities, complain that schools for their children are substandard. They want international level, not county level, schools for their children. Children’s education has been a critical factor in overseas returnees’ decision-making. The concern about the suffering of kids’ education if relocated to China was expressed (Fu, 2014). Complaints about both Shenzhen’s lack of cultural opportunities and facilities that can entertain people with fine tastes and its shortage of top-flight schools indicate its current barriers to attracting international talent. Not surprisingly, two interviewees who are hardcore music fans often commute to nearby city Guangzhou for entertainment events. Table 2 demonstrates three major stages of Shenzhen talents and their demands for city environment. In the first stage from 1980 to 1994, Shenzhen’s leading industry is traditional manufacturing and blue-collar workers are the major workforce. Their demand for city environment is low. With Shenzhen’s technological development, since 2006, high-technology and service industries have become leading local industries which leads to local talents’ demographic changes from blue-collars to advanced high-technology talents and research experts. Many of those talents have international education and living experiences which make their demand for city atmosphere and environment high: cultural facilities and entertainment amenities at the international level are desired.
Shenzhen has been catching up with its city infrastructure construction and entertainment amenities to be more international. In spite of its relative disadvantage, the key attraction of Shenzhen is its welcoming and tolerant culture. Survey participants in the study, Research on Shenzhen Talent Development Environment (2013), benefited from either the Peacock Talent Program or domestic talent initiatives. There was no way to tell the response differences in this data set between participants in the Peacock overseas talent and domestic talents policy programs. Among both overseas returning talent and domestic talent, 62.44% rated “Shenzhen city tolerance” as the top talent attraction factor. Career opportunities was listed second at 40.37%. The talent policy ranks only the seventh (see Fig. 4).
Though there is no way of differentiating domestic talent from overseas returnee in the survey study above, however, some of my interviewees who were the target of domestic talent initiatives (they do not hold overseas degrees, though some may have overseas exchange study experience, and graduated from local Chinese universities) reported the significant role the talent policy played in their decisions in coming to work and live in Shenzhen. One male interviewee in his early 30 s said:
Among the first-tier cities in China, namely Beijing, Shanghai, Guangzhou, and Shenzhen, the welcoming and tolerant culture in Shenzhen is unbeatable. I happen to hold a doctoral degree that is in demand in the city. Therefore, I was assessed as “High-talented reserved talents,” and I receive 320,000 RMB tax exempt from the city government every year. I am scheduled to receive this amount in maximum five years as a “reserved talent.” (Interview, 2020)
As in the case of many other young migrant professionals, he also praised the timely professional information exchange in the fast-changing environment in Shenzhen. “I probably cannot even adjust to a slow pace work and lifestyle if I go to a third-tier city.” More than Shenzhen’s lifestyle keeps him in the city. He works at a technical company using his expertise and serves as an advisor to a local think tank, occasionally giving lectures on supply chain management. City dynamism and various job-hopping opportunities excite him. “I am just doing this for fun,” was his catchphrase during our conversations, which suggested that he could change jobs easily in Shenzhen. He held a doctoral degree in new material engineering but acknowledged the “Shenzhen Talent Dilemma”: No basic scientific research is conducted at local universities. Throughout my research interviews regarding talent migration to Shenzhen, it is clear that some renowned Chinese and foreign universities set up outposts in Shenzhen, but never bring their best professors in relevant disciplines there. Sometimes, students at Shenzhen campus need to commute to Beijing or other cities to meet with their advisors and research peers. Though there are not many renowned professors living and working permanently in Shenzhen, postdoctoral fellows are abundant there. The early 30 s male interviewee shared with me: “You know why there are so many postdoctoral fellows in Shenzhen? Because being a postdoctoral fellow increases your chances to secure national scientific research projects (to Shenzhen), so you would be qualified as a domestic high-talent in Shenzhen.” Similar opinion was expressed by others: “to some extent, it is not Shenzhen’s problem that it does not have advanced scientific research institutions or good comprehensive universities. National Ministry of Education assigns quotas to each university regarding the disciplines and subjects it allows to have.” (Interview, 2019) The Shenzhen Talent Dilemma reflects its research and education drawbacks and highlights the dilemma of Shenzhen and China’s higher education: Universities themselves lack autonomies in designing academic disciplines and creating new departments to recruit research talents. The evaluation of education and research accomplishments is assessed by the amount of grants and scientific research projects brought to Shenzhen but not the actual quality of research. Some doctoral degree holders in science and engineering apply for grants to achieve personal financial and talent-policy advancement to settle down in Shenzhen. The execution of local talent initiative is encouraged and supported by local government; however, higher education reform is controlled and limited by governments at higher levels. A professor from a renowned Chinese university commented on the stagnant progress of Southern University of Science and Technology established in Shenzhen in 2010:
The goal they set for Southern University of Science and Technology at that time was unreachable. It did not match with the overall social and political environment in China. The initial wish is good: Let intellectuals but not bureaucrats be in charge of the university. But, where does the university get funding from? They wanted to follow American style to organize a board and raise money from private enterprises or individuals. However, in the end, governments are back in charge.Footnote 15 (Phone Interview, 2020)