Sunday, February 14, 2010

Will they come back - China's migrant workers? CSB-trends

waiting coupleby dongdawei via Flickr
You do not have to be a clairvoyant to know what major issues will be discussed at the Chinese New Year tables in Guangdong and Hubei provinces. In Guangdong company owners and managers of China's again-booming export industry wonder whether in a few weeks time they will have enough workers to restart their factories. And in Hubei, and many other provinces, millions of Chinese discuss whether they will go to China's south for another year of hard labor.
How different was it last year, as China's export industry was hard-hit by the international crisis and millions of migrant laborers would have to ask themselves whether they would have a job, when they returned to the south. Many were already laid-off months ahead of the new-year celebrations. Western media predicted massive unrest and many problems among China's unemployed.
How different did it go. The returned migrant workers picked up easily jobs in their home towns, because of the increased economic growth and the many construction projects that were financed by the USD 1,6 trillion rescue packages of the government.
Bumper harvests over the past few years had already increased the pressure on the export industry: its was harder to attract migrant workers to the south. Increased minimum wages indicated that working in Guangdong and Fujian was decreasingly an option for migrant workers. For a year these minimum wages, and other measures to improve the life of migrant workers had been frozen, but a few months ago the road was cleared again for new raises of the minimum wages.
zjwpic3Already years ago the Zhang Juwei's China Academy of Social Sciences predicted a major change in China's labor force. The labor shortages had been felt mainly in the southern provinces, but would around 2009, 2010 develop into a national problem. From a country with abundant labor, labor shortage would become an issue everywhere in China.
What is the expected policy? In stead of reducing the trade deficit with the rest of the world with a focus on a different currency exchange, wages will go up. Indeed, China might become less competitive in international trade, but domestic consumption might become an alternative. We have interesting times ahead.

Zhang Juwei is a speaker at the China Speakers Bureau. When you are interested in having him as a speaker, do let us know.

This article focusing on upcoming China-issues and is part of the monthly newsletter of the China Speakers Bureau. When you are interested in getting our February newsletter, and the next ones, do not forget to register here.

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