Eliza Wong
The Mega-City’s Talent War Escalates
Dongguan, one of China’s 27 trillion-yuan GDP cities, has intensified its efforts to attract talent with back-to-back policy announcements. In mid-August, the city abolished age restrictions for degree holders seeking residency and eased requirements for professionals with technical titles. By September, it rolled out the “Dream Realization Plan,” offering subsidies, free temporary housing, and rental benefits for startups and job seekers. These moves highlight Dongguan’s urgent need to overcome its reliance on low-value-added manufacturing and transition toward innovation-driven growth.
Key Policy Reforms
The first wave of changes, effective September 1, removed previous barriers for talent acquisition. Degree holders no longer face age limits—only a requirement to have contributed to pension insurance. Professionals with junior, intermediate, or senior titles can now qualify without stringent academic credentials. These adjustments make Dongguan’s residency policy one of the most flexible among major Chinese cities.
The second initiative, launched on September 8, provides tangible incentives:
- Monthly stipends of ¥1,000 for interns in high-tech firms and research institutes.
- Up to 15 days of free accommodation for non-local graduates job hunting or starting businesses.
- Rental subsidies scaling with team size—from free co-working spaces for small startups to 500 square meters of rent-free space for larger enterprises.
- Financial support including ¥10,000 grants for new businesses and up to ¥10 million in venture funding for competition-winning projects.
Why Dongguan is Going All-In on Talent
Dongguan’s aggressive talent war stems from its need to counter structural economic weaknesses. As a manufacturing powerhouse, it contributes significantly to global supply chains—producing one in four smartphones, one-fifth of the world’s sweaters, and a quarter of animated toys. Yet, its industries remain heavily dependent on low-margin OEM (original equipment manufacturing) models.
The World Factory’s Growing Pains
Despite impressive industrial output, Dongguan’s average enterprise profit margins linger below 5%, with R&D spending consistently under 3% of revenue. Over 70% of critical components are imported, exposing the city to external supply chain risks. In 2023, 28.6% of its scale-up industrial firms reported losses—a 12-point increase from five years earlier.
This vulnerability became starkly evident in 2023, when Dongguan’s growth slowed amid shifting global trade dynamics. Unlike neighboring Shenzhen, which has pivoted to tech and innovation, Dongguan struggled to climb the value chain. Its industrial concentration—while diverse—lacks the high-tech depth needed for sustained competitiveness.
Industrial Upgrading: A Make-or-Break Moment
To escape the “large but not strong” paradox, Dongguan is pursuing an ambitious industrial transformation strategy. In 2023, it announced support for the digital transition of over 1,000 manufacturers. Later that year, it hosted a global investment conference, unveiling 1.2万亩 (approximately 8,000 acres) of industrial land and a ¥200 billion high-quality development fund.
Strategic Sectors and Future Goals
Dongguan is focusing on six key industries: semiconductors and integrated circuits, new energy, digital economy, biopharmaceuticals, high-end equipment manufacturing, and modern high-end services. By 2027, it aims to cultivate at least seven industrial clusters worth over ¥100 billion each and raise the proportion of high-tech manufacturing output to 42%.
In 2024, the city introduced an “8+4” strategic emerging industries system, aligning with Guangzhou and Shenzhen’s industrial planning. It also aims to become a hub for AI-powered terminal products, smart manufacturing, and original IP development—particularly in the booming潮玩 (trendy toys) sector.
Case Study:潮玩 Industry—From OEM to Original IP
Dongguan produces 85% of China’s潮玩 products and a quarter of the world’s animated derivatives. Yet, as a 2023 government report highlighted, most firms remain stuck in low-value-added processing roles. To capture more value, the city is now incentivizing原创 (original creation) and brand development.
New Support Measures
In August, Dongguan allocated ¥120 million to support潮玩 and animation. The package includes:
- Exhibition subsidies up to ¥200,000 for companies participating in domestic and international trade shows.
- Rewards for原创 content: ¥5 million for award-winning works, ¥1 million for online hits, and up to ¥2 million for box office successes.
- Funding up to ¥5 million to attract top companies and IP studios to set up R&D centers in Dongguan.
These steps aim to help local firms move into design, marketing, and distribution—the high-reward segments of the smile curve.
Early Results and the Road Ahead
Dongguan’s talent policies are already showing promise. In 2023, the city added 83,500 permanent residents—the ninth-highest growth nationwide. The skilled workforce has expanded from 622,000 to over 1.73 million, with high-skilled talent now accounting for 39.45% of this group.
To sustain this momentum, Dongguan is also strengthening its recruitment infrastructure. Since 2022, it has organized over 30 talent recruitment tours across China and hosted thousands of employment fairs. The “就莞用” (Employment in Dongguan) initiative offers physical and digital platforms to match employers with job seekers.
Dongguan’s Talent War—A Template for Other Cities?
Dongguan’ experience underscores a critical lesson: industrial upgrading cannot happen without human capital. By combining residency incentives with financial support, startup incubation, and industry-specific programs, the city is creating a holistic ecosystem for talent and innovation.
For other manufacturing-dependent regions, Dongguan offers a viable model. Its focus on aligning education, industry, and policy provides a blueprint for transforming traditional industrial bases into modern innovation hubs.
As global competition for talent intensifies, Dongguan’s all-in strategy may well determine whether it evolves into a high-tech leader or remains a workshop of the world. The outcome will resonate far beyond the Pearl River Delta.
