The emerging external labor market and the impact on enterprise's human resource development in China

China has undergone substantial restructuring at both the macroeconomic and the enterprise level, and its admission into the World Trade Organization in 2001 provided further impetus to the reform process. Global competition and a reconsideration of national human resource policies have underpinned much of this reform and have led to an emerging external labor market. Little research, however, has been undertaken on this labor market and its impact on human resource development. This study examines human resource development choices to recruit externally or train internally. This “buy or make” decision is explored in businesses in Beijing and Shanghai, cities that represent the more developed regions of China and provide an indication of future trends. The article concludes with a discussion of the policy implications of the research and suggestions for future research.