Shifting Moods in China's Migrant Labor Pool

"A shortage of laborers is a good thing," said a source at the Ministry of Human Resources and Social Security (MOHRSS). "Sweatshops exploit people, relying on cheap labor to turn a profit. With fewer workers, they won't be able to keep doing that.

"In effect, this phenomenon is a step up for China, an opportunity for transformation."

Long-term Trend

Migrant labor levels have been falling for several years, said Zhang Libing, head of the MOHRSS Labor and Employment Research Facility, in an interview with Caixin. He said the economic crisis merely brought the problem to a head.

The shortage became particularly noticeable after global economic recovery led to a rapid increase in orders last summer. Since then, exports have continued to rise – and employers have scrambled.

The Ministry of Industry and Information Technology said textile exports increased by 18.2 percent in January. At the same time, furniture exports climbed 7.6 and overseas toy shipments rose 5.9 percent. Electronics, which account for half of all nationwide exports, climbed 27 percent.

Lin Jiang, deputy director of Sun Yat-sen University's Tax Research Department, told Caixin that while some reports of increased orders may have been exaggerated, research he conducted last year in Dongguan showed many manufacturers chose to sell at a loss while competing for orders. They hoped to stay afloat through the post-crisis period and make profits later.

In addition to competing for orders, manufacturers jostled over a limited number of workers. An MOHRSS survey said the scramble for workers after Spring Festival would be more intense this year. Meanwhile, help wanted ads in coastal cities indicate that the labor market's biggest unfilled hole is unskilled labor.
 
Looking Inward

It appears migrant workers are continuing to leave their rural villages for jobs in areas. But instead of one of China's traditional manufacturing hubs, such as the Pearl River Delta, many are heading for new destinations.

A survey of migrant laborers by the National Bureau of Statistics found 29 percent planned to travel to for work in western cities after the Spring Festival this year, up 7 percent from last year. But 8 percent said they won't be leaving home this year.

The head of the National Development and Reform Commission's Small Town Research Center, Li Tie, thinks more migrants will seek jobs in China's interior. That trend would match the government's plans for developing inland cities and moving more production away from coastal areas. Migrants will continue to seek jobs in big cities, official statistics indicate, but fewer will work in coastal population centers.

The government's 4 trillion yuan economic stimulus project was expected to steer massive amounts of capital into infrastructure construction in China's interior, creating jobs, Li said.

Not only are jobs moving inland, but compensation levels between coastal and other parts of China have narrowed. A villager who used to migrate to earn 1,000 yuan a month at a distant factory job now has more options closer to home.

Ai Zhenjun used to migrate for work in Beijing, far from his hometown Hebi in Henan Province. He said he could make no more than 120 yuan a day in Beijing, but his daily wage in a new economic development zone in Hebi was at least 100 yuan, and he also received free meals. Moreover, Ai would rather not live and work in a city far from home.

1 yuan = 14 U.S. cents