There’s an ongoing contest between the U.S. and European economic systems. And one of the key battlegrounds is nowhere near New York, Dallas, Brussels or Berlin. It’s China—that is to say, which side of the Atlantic is best able to work with and take advantage of Asia Pacific’s emerging economic powerhouse?

A recent press release from the other side of the Atlantic pond highlighted one way Europe is sowing the seeds for long-term success in China. It called for European managers to apply to the European Union-China “Managers Exchange and Training Programme,” a 10-month program that includes intercultural training, Chinese-language study, seminars, visits to Chinese companies and a three-month internship at a Chinese or European company in China.

METP is a four-year effort of the European Commission and the Chinese government aiming to serve a total of 200 managers from the European Union and 200 managers from China.

The program is tailored for frontline and midlevel managers. Applicants are supposed to have no or only very limited knowledge of Chinese language; be between 26 and 40 years of age; and have a minimum of five years of work experience.

The U.S., too, has been willing to have government play an active role when it comes to commerce with China. But U.S.-led business exchange efforts, such as the U.S.-China Oil and Gas Industry Forum seem geared to helping high-level executives make connections with Chinese counterparts.

I’m not aware of any U.S. government program akin to METP—one that encourages managers lower down in organizations to develop expertise and relationships in China. That expertise and those relationships can translate into concrete business deals as METP participants advance in their careers.

METP is of a piece with Europe’s focus on “sustainability” and long-term thinking. Both the U.S. and the European Union face widening trade deficits with China. And both would like to close those gaps by exporting more to China. Will the investment in budding managers in the METP program pay off for Europe down the line?

The news of major U.S. job losses in March is ominous for a number of workforce management reasons.

The U.S. Labor Department said Friday, April 4, that the American economy lost 80,000 payroll jobs in March. That was worse than expected and the biggest one-month loss in five years. Payroll employment figures also were revised to show greater job losses for January and February, and the unemployment rate rose from 4.8 percent in February to 5.1 percent in March.

The first problem with these numbers is they suggest companies are ignoring the sage advice to try to weather the economic storm by limiting layoffs or avoiding them altogether. Instead of taking a near-term hit to profits and investing in long-term growth, companies seem to be cutting jobs heavily.

Such short-term thinking could come back to haunt U.S. firms. Jettisoning talent and potentially damaging morale for remaining workers can cripple companies and their ability to bounce back in better times. Stanford University business professor Jeffrey Pfeffer says companies tend to give up people too easily in downturns only to pay a steep price for talent during good times. “You should not do what most companies seem to do, which is buy high and sell low,” Pfeffer says. “There’s an unwillingness for companies to behave counter-cyclically.”

McGill University management professor Henry Mintzberg argues that the U.S. penchant for axing workers gives Europe an edge in recovering from a recession. “Europe is better prepared. Much better,” Mintzberg says. “The soul of the enterprise is much more intact in Europe. There’s much more respect for the idea of collective effort there.”

Then there are “tragedy of the commons” concerns about widespread layoffs. Each job cut can help push the overall U.S. economy into recession—or deeper into one—as consumer spending and confidence suffer.

U.S. stagnation in turn threatens to tip other parts of the world into economic trouble. Asian companies and economies depend heavily on the spending of U.S. consumers and businesses.

A vicious circle can come into play, as foreign countries’ woes afflict U.S. exporters and further depress the American economy.

To be sure, some companies can’t help but lay off workers in dire circumstances. And economic turmoil requires government leadership in addition to smart actions by businesses. What’s more, there are some enlightened companies that behave “counter-cyclically.”

But are there enough to keep the U.S. economy from sliding further?

A new study from consulting firm Hay Group echoes some of what we learned last year in a major report on China: Premature promotions and related salary hikes can hurt companies.

In its study of the Chinese operations of more than 300 multinational corporations, Hay Group found that when Chinese employees are lured away from their current job, they not only get a promotion but pocket at least 40 percent more in base salary. This compares with averages of 24 percent and 21 percent in Singapore and Hong Kong, respectively.

The report also found that if employees move to a position that is two steps above their current role—a “Champagne” promotion—their base salary jumps by 91 percent. That compares with a 48 percent increase in Singapore.

On average, Hay Group says, Chinese senior managers are five years younger than their Asian counterparts, and the gap widens even more in comparison to the West.

In our report on China’s “Too Fast Track” in March 2007, we found that a rapidly growing economy combined with a dearth of leadership talent added up to many overly quick promotions.

Edward Tai, an executive with Hyatt International Hotels and Resorts, offered us a case in point. He told us that Hyatt often creates elaborate four-year plans to groom up-and-coming execs to head a department in China. But feverish competition for managerial talent means the plans can go awry.

“By the second year, we do not think he is quite ready,” Tai said. “But the other hotel chains, or other places, thinking he is from a Hyatt or a Grand Hyatt, say, ‘He’s ready,’ and give him double the pay and then bring him over.”

Hay Group recommends that companies develop long-term pay-for-performance programs. Multinational firms “must stop the current ‘Pay now, worry later’ compensation programs,” Hay Group’s Sean Joo said in a statement.

We found in our research that some major multinationals were attempting to solve the immature-manager puzzle through a focus on employee development and careful attention to corporate culture.

Have you heard of companies in China handling this issue wisely—or unwisely? I’d like to hear your thoughts. E-mail me at efrauenheim@workforce.com or leave a comment below.

Here’s one explanation why software firm SAP has become one of the world’s leading technology companies over the years: it is a great place to work.

SAP recently was named Germany’s best workplace in the category of companies with more than 5,000 employees by the Great Place to Work Institute Germany. The award marks the fourth consecutive year the Walldorf, Germany-based firm has taken top honors in the contest. SAP, which is one of the biggest sellers of HR software in the world, also was honored as one of the 25 best companies to work for in Japan this year.

If there remain doubters that a positive work climate corresponds to sound business results, consider a recent study from a University of Pennsylvania researcher. Finance professor Alex Edmans found that companies cited as good places to work earn stock returns that are more than double those of the overall market. In particular, companies on Fortune magazine’s annual list of the 100 Best Companies to Work for in America between 1998 and 2005 returned 14 percent per year, compared to 6 percent a year for the overall market.

SAP has its critics, and it is locked in a fierce battle with Oracle in the business software market. But over the long haul, it seems to have learned how to adapt. For example, SAP’s old reputation for arrogance (as in, SAP means Shut Up and Pay) has faded and the firm has become a much humbler organization in tune with today’s business focus on collaboration.

Part of SAP’s software success involves learning from its own experience. In an interview a couple years ago, SAP HR head Claus Heinrich told me his operation acts as a lab for the firm. Heinrich has pushed SAP software product managers to include features ranging from a 360-degree feedback process to online pay stubs.

Another key, it seems, is treating its talent as a top priority. As long as SAP keeps winning prizes as a great place to work, I wouldn’t bet against it remaining in the top echelon of the tech world.

If the global economy spirals downward as some think it could, workers are likely to take it on the chin. And if that happens, it’s a fair bet that support for globalization will erode.

A new report from the International Labour Office finds that economic turbulence—largely due to credit market turmoil and rising oil prices—could spur an increase in global unemployment by an estimated 5 million people in 2008.

The number of unemployed people worldwide in 2007 was an estimated 189.9 million, and the global unemployment rate was 6 percent, says the ILO, an agency of the United Nations.

Not only does the ILO’s annual Global Employment Trends report warn of a gloomy 2008, it has some bad news from 2007. Despite “sound” global economic growth of 5.2 percent and a net increase of 45 million new jobs last year, not all was sweetness and light for workers around the world, according to the study. It said the global unemployment rate was virtually unchanged, and the worldwide deficit in decent jobs—especially for the poor—is “massive.”

An estimated 487 million workers, or 16.4 percent of all workers, still don’t earn enough to lift themselves and their families above the $1 per person, per day poverty line. Meanwhile, 1.3 billion workers—43.5 percent—still live below the $2 per day threshold, the ILO says.

“While global growth is annually producing millions of new jobs, unemployment remains unacceptably high and may go to levels not seen before this year,” ILO director-general Juan Somavia said in a statement.

For business leaders, the prospect of millions more workers unemployed around the world this year should do more than tug at the heartstrings. Those workers double as consumers who may lose purchasing power, and as citizens who may turn against the global trade system.

That interconnected system is generating prosperity and profits in many places. But it also can amount to a tight-wire act for workers—one in which the safety net leaves much to be desired.

Unemployment benefits have been falling in the group of mostly developed countries that make up the Organization for Economic Cooperation and Development. A report last month from the research organization found that across most OECD countries, the level of benefits that unemployed people typically receive was 59 percent of average after-tax earnings in 2001. That figure fell to 55 percent in 2005. The report found that the “index of generosity” in the U.S., Greece, Turkey and Italy is below 30 percent.

Already, support for global trade is waning in some quarters. Americans and Western Europeans are less supportive of international trade and multinational companies than they were five years ago, according to a study last year by the Pew Research Center.

Political leaders in the U.S. are working on an economic stimulus package that may temporarily extend unemployment benefits. Will these leaders and others around the world do enough to head off or ease the potential trouble ahead?