The place to be

The research also found that more than 69 percent of these expatriates were happy with the career advancement opportunities in China.

Adding to their enthusiasm is a growing number of companies looking for skilled staff, both Chinese and foreign.

Wolters-Kluwer Health, which opened its office in Beijing last year, is one company that is constantly looking for fresh talent. The company's talent focus is centered on people who can help bridge the US-based medical IT company and its China clients.

"We are seeking people with Chinese experience as we expand," says chief executive Arvind Subramanian.

Candidates who not only understand China, but also the nuances and complexities of the healthcare IT industry and those who can translate the needs of their Chinese clients are the ones the company constantly looks for, he says.

Technology and healthcare are among the top five jobs held by foreign nationals in China at 15 percent and 12 percent respectively, Natwest says. Leading the pack is education with 30 percent, followed by finance with 19 percent.

While many of the new arrivals seek opportunities in Beijing or Shanghai, increasingly second-tier cities such as Chengdu, Tianjin and Chongqing are drawing foreign professionals away from them.

Outside of the top three cities -Beijing, Shanghai and Guangzhou - Suzhou in Jiangsu and Fuzhou in Fujian have the most non-mainland residents, according to data from the National Bureau of Statistics.

During the formative years of the economic giant China has grown into, the few international employees companies had were given large hardship allowances as incentive to live and work outside their home country.

Based on a number of factors ranging from cultural, language and climatic differences, the premium packages offered a basic pay bonus of up to 25 percent of the employee's base wages.

In addition to bonus pay, hefty hardship allowances included housing allowances of more than $3,000 (2,320 euros) a month but were required due to restrictions on where expatriates could live and the high prices there.

Education allowances that enabled executives to pay tuition fees for top-notch international schools for their children and chauffeurs were also commonly included in China's early hardship packages.

Differing expectations

While that level of compensation may seem generous for "hardship" compensation in modern day Beijing and Shanghai, Rob Dean, founding partner and client services director for Oxus Solutions, a China-based employment communications company, says at the time there was an overall presumption that China lacked even basic amenities.

"People tended to set their expectations (of China) low, especially in the early days," he says.

Dean, who initially traveled to China to study in 1994 and has worked in the country since, recalls one of his university roommates from the US going so far as to packing several bars of soap, assuming he could not buy it in China.

Soap was readily available in Beijing, but many other creature comforts from the US and Europe were not. Dean watched the changes during his tenure as a customer service manager for inbound personal effects shipments in the mid-1990s.

"Furniture, white goods and electronics gradually started disappearing from packing slips," he says.

As housing restrictions were lifted and living in China became increasingly affordable for a wide range of foreign talent, not just those on high-paying hardship allowances, more modern products and services for expatriates sprang up in big cities.

A decade and a half later China's top cities have become professional destinations often sought by high-level executives as a springboard for a company's global operations.

Though expatriate hardship pay packages once widely used to lure employees to China still exist, they are less common and less generous.

"The concept has moved on from being about what we call hardship. We now refer to it more as a location allowance," says Lee Quane, regional director for Asia at ECA International, a human resources consultancy.

"It is also very hard to assess which location is better than another."

He says that five to 10 years ago, ECA International, which researches and advises companies on location allowances, might have suggested a 20 to 25 percent increase in salary for those moving to first-tier cities. Now they may suggest something as low as 10 percent.

The US Department of State's (hardship) differential allowances for foreign postings, which are often used as a gauge for US companies offering hardship postings, gives its staff a 15 percent bonus salary in Beijing and 10 percent in Shanghai.

In China's second and third-tier cities the percentage offered by the Department of State jumps to 20 percent for Chengdu and 30 percent for Nanjing and Shenyang.

To get a global comparison, US staff moving to cities like Kabul would receive a salary boost of 35 percent - the maximum allowed.

So is China still a hardship post? It depends on who is asked.

Quane says it boils down to where the person is coming from and where they are moving. "In China, you have two types of foreign employees," he says.

"You've got those who are still relatively young - those who are quite pioneering and quite outgoing. They've taken their own initiative to seek out work in China and relocated voluntarily."

He says for these types of staff, the move to China is the incentive in itself.

"They've been given an experience they can put on their CV or resume for the next few years and that will make them more employable or (help them)move up the career ladder much faster."