China facing a labor shortage

[Guest Tony n Terrific]

Just a year ago there was widespread layoffs in China's Pearl River Valley. Now today the are having a labor shortage. The stimulus plan has worked in China. Here in the US we are still financing how honey bees mate and what favorite Son will get the most money.

 

http://news.bbc.co.uk/2/hi/business/8527621.stm

Edited February 22, 2010 by Tony n Terrific (see edit history)

[Tony_onrock]

just came back from a trip to Chengdu. Funny scene on TV, with employers holding out cardboard cards stating the number of people, salary, work etc required at this job fair. Some played nasty and went direct to the train station to get a head start before the others. It was like a meat market.

[a2784]

Just a year ago there was widespread layoffs in China's Pearl River Valley. Now today the are having a labor shortage. The stimulus plan has worked in China. Here in the US we are still financing how honey bees mate and what favorite Son will get the most money.

 

http://news.bbc.co.uk/2/hi/business/8527621.stm

comments from the article:

 

Expectations of higher wages and better working conditions from new workers are being blamed for the labour shortage.

 

 

Some experts point out though that if companies are faced with a shortage of workers, that could force them to invest in new technology.

 

In that way the shortages may actually help to speed up the transformation of the economy here into one that is less labour intensive, delivering higher value.

[Christopher]

That would be the US model where labor priced itself out of the market. It was cheaper to buy and operate robotics than pay humans. The other option was to move labor intensive operations to places that labor was much less expensive - SE Asia, for example. As Asia labor costs increase, look toward Africa for the next emerging market.

 

2 points:

 

1) No one is pointing a gun at these companies forcing them to make lavish offers of employment. Even more so, in that there are no unions whatsoever in the picture.

 

These factories are just doing what comes naturally in when nothing stands between them and tens of millions of yuan but labor priced at 11% of cost of goods sold versus 10%. It's an eminently rational decision, and one you would make in the same situation.

 

2) Robots have great appeal for people who need someone who:

 

* can slave away 24x7 and not get tired or ever screw up

* can't be poisoned, injured or killed

* can do small stuff more accurately at blazing speed

 

I suppose some people are just fine with making crappy goods, replacing sick, dead and hurt employees, or 30 year old technology. For the rest of us, there are robots.

 

Big question in my mind is: what will we do when fully automated factories do everything better and cheaper than humans working at starvation wages? That day is guaranteed to come in the next 50 years or so: only so many service jobs to go around, not everyone can be a designer or robot maintenance tech, and not a manufacturing job in sight.

 

Hooah! I guess the fit will really hit the shan then.

[TLB]

That would be the US model where labor priced itself out of the market. It was cheaper to buy and operate robotics than pay humans. The other option was to move labor intensive operations to places that labor was much less expensive - SE Asia, for example. As Asia labor costs increase, look toward Africa for the next emerging market.

 

2 points:

 

1) No one is pointing a gun at these companies forcing them to make lavish offers of employment. Even more so, in that there are no unions whatsoever in the picture.

 

These factories are just doing what comes naturally in when nothing stands between them and tens of millions of yuan but labor priced at 11% of cost of goods sold versus 10%. It's an eminently rational decision, and one you would make in the same situation.

 

2) Robots have great appeal for people who need someone who:

 

* can slave away 24x7 and not get tired or ever screw up

* can't be poisoned, injured or killed

* can do small stuff more accurately at blazing speed

 

I suppose some people are just fine with making crappy goods, replacing sick, dead and hurt employees, or 30 year old technology. For the rest of us, there are robots.

 

Big question in my mind is: what will we do when fully automated factories do everything better and cheaper than humans working at starvation wages? That day is guaranteed to come in the next 50 years or so: only so many service jobs to go around, not everyone can be a designer or robot maintenance tech, and not a manufacturing job in sight.

 

Hooah! I guess the fit will really hit the shan then.

 

No day is guaranteed to come...

 

though come it might.

[Tony_onrock]

The move to Vietnam and Thailand already started two years ago. What we need here in China is a free labor union, like those in the US, controlled by the mafia or the communists (commies without Chinese characteristic). That would really help in moving the manufactoring out fast.