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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: BubbaFred who wrote (3374)	7/17/2004 7:41:03 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Talk about socks. A pair of good quality dress socks sold for <40 US cents in China, but here for 6 US dollars. and even on clearance, it costs $2 plus tax. And on employment. Here is something I do not see reported in English media: Guang Dong and Fu Jian Provinces have recently reported that there is an estimated 2 million cheap labor shortage in the two provinces. The day of cheap labor in China has unlimited supply might be over. Those mean sweat shop owners, most owners from Japan, South Korea, Taiwan and HK finally have got what they deserved for – have huge amount of orders on their hands but cannot find enough cheap labor that are willing to work for them<g>. Some major reasons for this new phenomenon: 1. Thanks to the new policy by the Chinese central gov. since late last year to eliminate variety of taxes on farmers, and raise the price of agricultural product, farmers income has been raised a lot. The new statistics show that bet. April and June this year, farmers income increased 16.1% (10.9% taking into account of inflation) comparing with same time last year. 2. Few and few surplus labor from rural areas are willing to work for the extreme low pay and long hour in those sweat shops. While workers’ salary in most parts of China has steadily increased during the last 20 years, NOT in Guangdong and Fujian. And in some cases, the pay in the latter even decreased. So who would want to go to strange places, work like a slave and being treated like dirt when they can earn same amount, or more, at home, or in other developing regions? A lot of sweatshop owners in Guangdong only pay about 10 Yuan (US$1.2) for a 12-hr day (after food and shelter, usually provided by sweatshop owners) for the low-skilled job, far less than what they advertised or told at the beginning. Not only the pay is low, owners also gets to keep the 1st month pay as fine when workers tell them they want to leave. The turnover rate is extremely high in those two provinces. And since more and more people who have been to Guangdong returned their hometown and had something bad to say about those sweatshops, so fewer and fewer inland people ever want to go there working. I have not yet heard/read anyone who has worked in a sweatshop in Guangdong or Fujian said they want to go back. 3. The competition from Chang Jiang Delta (include ZheJiang and JiangSu provinces, and Shanghai) for the cheap labor has an upper hand due to the higher pay, better working condition, less discrimination for outside labors (means labor from other provinces), and stronger labor law enforcement so better protection. I read that one guy said he worked in Guangdong for 8 years, and only had 600 Yuan of saving when he was leaving. Then he went to ZheJiang province, worked for only 4 years, already bought an apartment and can save 3,000 Yuan each month after living expenses and retirement/unemployment insurance.