SHENZHEN-He Shuaixing shakes his head listening to the pitch from a job recruiter on a cold wet day in a factory district outside Shenzhen, epicenter of China's export machine. The 26-year-old from the poor heartland province of Henan, like so many other workers, had just returned from his village after the Lunar New Year holidays and was looking for a job. But unlike an older generation of migrant workers, not just any job. "It's easy to find work, but not easy to find good work," said He, wearing a thin grey jacket and a flop of gelled hair. "We haven't seen any big improvements in wages or benefits."
Besides, the booming metropolis of Shenzhen was getting too expensive, he complained.
Labour shortages in Chinese coastal factories are nothing new. The world's workshop has been churning out the exports again after hitting a lull during the global financial crisis. But workers like He are becoming more choosy about the kind of jobs they want, eschewing the long hours, tedious work and poor benefits offered in China's many sweatshops. What's more, competition for labour is now coming from new factories in China's rapidly urbanising interior.
Chongqing (formerly Chungking), in southwestern Sichuan province and one of China's biggest cities, has launched a Spring Breeze Action campaign to recruit workers from the coast. It has raised monthly blue-collar wages to around 1,200 yuan (US$183), and is offering 300- yuan monthly subsidies to workers who take jobs in local factories. Around 40,000 signed up on the first day alone. The wage in Chongqing compares to 2,000 yuan in southern China's manufacturing belt. In Henan, a giant new Foxconn factory making iPhones will need several hundred thousand workers.
Fuyang, in eastern Anhui province-a quarter of whose 9.5 million residents were migrant workers-has recently dangled perks such as housing subsidies, TV-equipped dormitory rooms and health insurance to entice labour to its new factories. In response, authorities in some coastal regions have hiked minimum wages, raising expectations for further pay rises this year among workers squeezed by rising inflation. Guangdong province, home to the Pearl River Delta, one of China's main manufacturing hubs, will raise minimum wages by an average of around 19 per cent next month. Many factories, in fact, are already paying well above the minimum wage to retain and lure skilled workers.
Yiwu is famous for the cheap goods it makes at hundreds of factories and workshops-arts and crafts, hardware, cosmetics, household goods-and exports around the world. Job fairs had sprung up around the teeming market stalls after the New Year holidays and recruiters were shouting and waving cardboard signs. They seemed to outnumber the few job-seekers wandering about. New workers this year are asking for much higher starting salaries than older workers at her factory, she said.
The labour tug-of-war may well intensify. Standard Chartered Bank thinks China, with its one-child policy and transforming economy, will only generate three million new labour market entrants a year during 2011-15, compared with some 10 million a year in recent decades.
"The slowing growth (and then decline) of China's labour pool will clearly be negative for China's potential growth rate," wrote Standard Chartered economist.
