I just became aware of an interesting phenomenon in China: they are developing a labor shortage in some geographical areas of the country as well as some of their export industries. The government is self consciously trying to develop more business in the interior, leading many workers to remain there rather than returning to factories in the coastal regions which have been the engine of growth for the export industries that have been hitherto driving the Chinese economy. Here are a few recent articles on this, from NYT, WSJ and Bloomberg/BusinessWeek.
Defying Global Slump, China Has Labor Shortage
....The immediate cause of the shortage is that millions of migrant workers who traveled home for the long lunar New Year earlier this month are not returning to the coast. Thanks to a half-trillion-dollar government stimulus program, jobs are being created in the interior.
But many economists say the recent global downturn also obscured a longer-term trend: China has drained its once vast reserves of unemployed workers in rural areas and is running out of fresh laborers for its factories.
full article at nytimes.com
The Mystery of China’s Labor Shortage
For a country which still has significant surplus labor, the reportedly severe shortage of migrant workers in China’s economic engines such as the Pearl River Delta after the Lunar New Year holiday is rather baffling.
Various domestic media reports put the labor supply gap at around a million people in Guangzhou and neighboring cities such as Dongguan, legendary centers of China’s export boom in the past three decades. Numerous assembly lines and construction sites are sitting idle while anxious employers have raised salaries by more than 30% but still can’t attract enough applicants.
full article at blogs.wsj.com
How Rising Wages Are Changing The Game In China
...Wait a minute. Doesn't China have an inexhaustible supply of cheap labor? Not any longer. From the textile and toy factories of the south to the corporate headquarters and research labs in Beijing and Shanghai, the No. 1 challenge today is finding and keeping good workers. Turnover in some low-tech industries approaches 50%, according to the Institute of Contemporary Observation, a Shenzhen labor research group. Guangdong Province says it has 2.5 million jobs that remain unfilled, while Jiangsu, Zhejiang, and Shandong provinces say they, too, face shortages of qualified workers. "Before, people talked about China's unlimited labor supply," says Zhang Juwei, deputy director of the Institute of Population & Labor Economics at the Chinese Academy of Social Sciences in Beijing. "We should revise that: China is facing a limited supply of labor."
...
The pressure has as much to do with skills as it does with numbers. Although the total labor force is about 800 million, relatively few people have the qualifications employers want. For most textile, toy, and tech-assembly jobs, for example, export-oriented manufacturers prefer women from 18 to 25 years old or people with experience operating machinery. "The skills base does not meet the demands of a rapidly growing market," says C.P. Lee, Asia-Pacific human resources chief at Motorola Inc. (MOT ), which has 9,000 employees in China.
full article at businessweek.com |
