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Labor shortage hits China

Updated: 2011-02-21 17:00
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Labor shortage hits China

Editor's Note:
You can see them everywhere in China's big cities. Wearing tattered uniforms, battered helmets and hearty smiles. They sit along the sidewalks next to busy construction sites. They are the migrant workers, the backbone of China's amazing economic rise.

According to the National Bureau of Statistics, there are 150 million migrant workers in China. As China's economy continues to boom, the country's coastal provinces are facing a labor shortage after the Lunar New Year holidays, as the once seemingly endless flow of migrant workers seems to be dwindling.

Many migrant workers who returned to their hometowns for the holidays decided to stay there for a variety of reasons, including the lower cost of living, new prospects closer to home and wanting to be with children they had not seen for months or even years.

"The situation is extremely tough this year compared to previous years because only dozens of applicants handed in resumes for hundreds of vacant positions," said Li Huaying, owner of a Shanghai job agency who has been recruiting migrant workers for several years.

Statistics by the transportation department in Shanghai last week revealed the number of migrant workers returning to the city from Sichuan and Anhui provinces fell by 10,000 a day from last year. In South China's Guangdong province, it will be short by about 1 million workers this year, according to the director of Guangdong's labor bureau. A survey released on Feb 11, 2011 shows 67 percent of companies in the eastern province of Jiangsu expect to have difficulty recruiting new workers this spring.

So what is behind the labor shortage and what is new this year? 

Labor shortage hits China

 * Bonds to left-behind children

Many migrant workers say not wanting to leave their children, who were left behind in their hometowns, is the major reason they decided not to go back to the cities, Guangzhou Daily reported on Feb 15, 2011.

A recent study conducted by China Women's Federation shows that there are about 58 million left-behind children in China, and 40 million are under 14 years old. Some 40 million of the children cared for by relatives are under 14.

Nearly 30 percent of the parents of the "left behind" children have worked away from their hometowns for more than five years.

"I may not be able to make big changes to my life, and I don't want my kid to follow in my footsteps," said Wei Dongwei, a 26-year-old migrant worker from Central China's Henan province who has been working in Yiwu, East China’s Zhejiang province for six years.

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Labor shortage hits China
A child talks over a phone with his migrant-worker parents while her peers cluster around in Lashu village,Shaoyang county, Hunan province,May 27,2010. [Photo/Xinhua]

* Urbanization of interior cities

The rapid urbanization and economic development of China's interior have also led to more opportunities closer to home for many former migrant workers.

One noticeable result brought about by China's rapid economic development is that there are increasing employment opportunities in the central and western regions and a narrowing of the wage gap between developed cities on the coast and less-developed ones inland.

* Structural changes in China's demography

Zhang Yi at the Chinese Academy of Social Sciences' institute of population and labor economics attributes the labor shortage to structural changes in China's demography. The country's family planning policy, which has been running for 30 years, has resulted in decreasing numbers born in the 1980s and 1990s, which is problematic, he said, as young people make up a vast proportion of the migrant workers.

"Increasingly, more young and fairly well-educated workers do not want to be in labor-intensive factories that pay low wages and produce low value goods," he said, adding they want decent jobs and have higher expectations.

* China is undergoing an industrial transfer

Another reason for the shortage, said Zhang Yi, is an industrial transfer, during which the trend is for low-end manufacturing industries to move inland from China's eastern areas, causing a greater demand for workers there.

The central government has been encouraging enterprises in coastal regions to upgrade their production process and equipment, yet low-end production still makes up a large part of the manufacturing industry.

During the past decade, eastern coastal areas have frequently repeated the practice of battling for migrant workers when they receive orders from overseas and driving them away when business is down. China's coastal areas have forged a complete industrial chain but failed to create a mature domestic market and help narrow the wealth gap.

"Firms on the coast should upgrade quicker. That way, they won't need to compete with inland cities to lure cheap labor," Zhang said.

Labor shortage hits China


Migrant worker shortage a good phenomenon

The battle for hiring migrant workers is a good phenomenon and symbolizes the start of workers' domination in the labor market, according to a commentary by Yu Fenghui for Xinhua News Agency.

It has long been a social problem that their salary is kept low and not paid on time. The country has made efforts to improve the situation with policies to ensure workers' rights and an increased minimum salary, but it is far from enough to solve the problem in the coastal areas which have high industry density. The ultimate way out will be to rely on market mechanism, the commentary said.

Enterprises from China's coastal areas are moving inland to employ local workers, which not only can cut their costs, but it is convenient for workers, as the country's central and western regions develop.

The commentary said the battle for labor will raise the low salary level to some degree and migrant workers' social security needs such as pensions, medical care and work accident compensation will be gradually met.

Ye Tan, a well-known economics commentator, also wrote on her blog that it is a good sign that the severe working conditions the workers once had to bear are expected to change.

The emergence of a migrant worker shortage symbolizes that the eastern areas' development model is now a thing of the past, and there is no need to feel bad about this, but instead we should view it as a good thing, she said. 

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Labor shortage hits China

* Fierce battle for workers  
Labor shortage hits China
Recruiters hold up boards advertising jobs as they seek migrant workers at a job market in Yiwu, Zhejiang province. [Photo/Agencies]

Coastal and inland cities are fiercely competing to attract migrant workers as China's labor shortage spreads to less-developed central and western regions.

In Southwest China's Chongqing, many firms have set up booths at railway and bus stations to persuade workers to stay home instead of returning to the coast. The city's labor bureau on its website posted an open letter urging workers to find jobs close to home.

Enterprises in coastal areas are not giving up, however. Firms in Shanghai have dispatched almost 400 buses to bring in workers from Anhui, Henan and Hubei provinces.

Officials in Shaoxing, East China's Zhejiang province, reportedly contacted authorities in labor-rich Chongqing and Sichuan province for help in hiring more workers, only to be turned down.

At Guangzhou Railway Station in South China's Guangdong province, many company representatives held placards to grab the attention of arriving workers.

Creative methods to find workers

1. Tie-in hiring In some restaurants in Beijing, employed chefs have been asked to use their personal social networks to bring in three or four new employees to work as assistants to cooks or clean away dirty dishes and set tables.

2. Middleman's fee Makers of eyeglasses in Xiamen, Fujian province, have promised to hand over between 50 and 200 yuan ($8 to $30) in commission payments to migrant workers if they introduce people from their villages who are willing to work. 

3. Showing they care Catering employers in the capital have offered allowances of several hundred yuan to employees' families on special occasions such as Spring Festival, to show they care about them.   

4. Eye-catching recruitment ads A job advertisement reading "Better salary, stupid employer, act now" was just one example of the type of creative ads that have been popping up on websites. This one was from a furniture factory in Fujian province. The company said it wanted to attract the attention of more migrant workers because it was in urgent need of labor.
5. Outreach to universities A real-estate agency has launched an in-service training program for university students this year. It aims to train 10,000 graduates to become real estate agents. 
6. Psychological consultations An IT company in Dongguan, Guangdong province, has set up a psychological consultation room for its staff. The company said it is an attempt to develop its corporate culture and enhance cohesiveness. 
7. Adults only A furniture manufacturing enterprise in Dongguan is only offering positions to mature workers who are at least 25. It says mature staff members are usually more loyal to employers and more skilled at their jobs than those straight out of school.


* Shifting mindset of younger migrants

Labor shortage hits China


The "new generation of migrant workers", accounts for 61.6 percent of China’s migrant worker population, according to the National Bureau of Statistics. A report released by All-China Federation of Trade Unions defined the new generation as those born after 1980s and above 16 years of age, work in cities but still have a rural hukou (household registration).

Traditional migrant workers have had experience of working in fields, which differs from the new generation who were brought up in cities by their migrant worker parents, or came to work right after graduating from middle school.

They value self-improvement as well as earning money. They demand for better working conditions and social welfare. They seek permanent migration to the city and social respect.

"I hope I can learn something from the job and then go back to start my own career. For me, it is the priority to learn more. We shouldn't be short-sighted."

--Peng Jiulin, 22, was not eager to find a job in Hangzhou, capital of East China's Zhejiang province.

"We want to earn substantial money, learn new skills and accumulate social skills and knowledge. A heavy job isn't ideal."

--Many young adults born in the 1980s and 1990s told China Daily

"They are generally more educated and thus more aware of their legal rights."

--Feng Jin, a professor of labor economics at Fudan University.

"Migrant workers now pay more attention to working conditions, social welfare and leisure time and expect wages of more than 3,000 yuan a month."

--Li Huaying, owner of a Shanghai job agency who has recruited migrant workers for several years.

"Unlike the older generation who only work in the cities, more than 70 percent of the new generation of workers are willing to also live in the cities."

--Liang Guiquan, director of the Guangdong Academy of Social Sciences.

"Compared with the first generation of migrant workers, the younger migrants had wider career choices because they were better educated. They depended less on the land and the trend was toward permanent migration to the cities."

--A survey among 5,000 young migrant workers in Shanxi province by the Shanxi committee of the Communist Youth League of China.