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The Impact of China's Air Pollution On Employee Relocation Policies

November 6, 2014 3:24:00 PM EST | By: Michelle Dopps

Written by: Pam Buchanan and Spring Zhou

China pollutionOver the past several years, China has been experiencing ever higher levels of air pollution. Thick smog and haze covers more than 2.7 million square kilometers of the country, affecting more than 600 million people. The provinces suffering the most are Hebei, Shandong and Shanxi, while the air quality in Beijing and Tianjin continuously fails health standards.

The World Health Organization has stated that 7 million deaths were attributable to air pollution worldwide in 2012, and 40% of these were in the Asia-Pacific region dominated by China. As these numbers continue to increase, there has been a considerable exodus of China’s wealthiest citizens fleeing their country for cleaner air, non-tainted food and better education. The majority of these citizens are migrating to the United States, Canada and Australia with some electing to give up their Chinese citizenship.

Throughout 2013 to the present we have witnessed air pollution worsening, further increasing early repatriation activity of assignees, especially from assignees located in Beijing. The World Trade Organization (WTO) considers a healthy air quality level to be at 25 micrograms – Beijing air quality levels have been as high as 700 micrograms at times!  

Impact To Relocation Policies

Due to this sharp deterioration in air quality, corporations in China have started providing free masks and air purifiers in both homes and offices to reduce risks of asthma, lung cancer, heart disease and other health issues associated with long-term exposure to smog. Relocation management companies and destination service providers are now including air purifiers as a non-negotiable prerequisite during the lease negotiation stage, and landlords are usually happy to provide.

Increasingly, we are seeing global multinational companies take additional steps in addressing their expatriates’ needs and concerns in reaction to the air pollution crisis in China, such as:

  • Increasing employee hardship allowances
  • Paying hazard/danger pay in addition to hardship allowance
  • Providing additional time off with paid trips to a company-designated rest and relaxation destination
  • Sending employee to assignment location without family and providing more frequent home leave trips
  • Covering costs to insulate employees’ homes and offices against bad air
  • Providing additional sick days to accommodate really bad air quality days
  • Providing additional healthcare options to accommodate the increased number of doctor visits
  • Educating expats more on how to reduce their risk of exposure to smog and air pollution while in China 

On a positive note, the Chinese government has been responding to the increasing concern in a very quick and structured way, and a formal action plan with tough objectives has been rolled out pledging to declare war on air pollution. The plan aims for a marked improvement in air quality over the next five years.  Some of the key areas include:

  • Upgrading emission standards by banning heavily polluting motor vehicles from the streets by 2017
  • Strictly controlling coal consumption
  • Cutting back in steel production capacity
  • Establishing monitoring and early warning systems to respond to heavily polluting weather by the end of 2015 (for all provincial capitals)
  • Continuing construction by further adding 150 billion cubic meters of natural gas pipeline transmission capacity

This action plan was formed in December of 2013 and involved six government departments who promised the public that they would see real improvement and that residents would feel the change. Interestingly enough, China is one of the world's largest producers of green energy technology, although much of it is exported at present. 

At present, China is under intense pressure to take responsibility in correcting their air pollution crisis.  Their most recent comments trying to place a positive spin on the heavy smog are appalling – they argue that smog can serve as a defensive advantage in military operations as a means of obscuring the enemy's sight lines and that the pollution fouls the enemy’s electronic equipment. Only time will tell if China is serious about taking the necessary steps to improve air quality for the long run and in return change the global community’s perception of China as they become more responsive to their population’s concerns and move into a position of global leadership.

For information or questions about this blog post please contact Pam Buchanan, Lexicon Consulting Services, +1-904-858-1255 ext. 1979 or via email at pbuchanan@lexiconrelocation.com. 

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Topics: china assignments, relocation companies, assignee, apac global mobility, China, corporate relocation program, international assignments

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