Labor shortage hinders Guangdong factories

By Qiu Quanlin (China Daily)
Updated: 2009-08-25 10:30

GUANGZHOU: Xiao Senlin has been concerned about recruiting workers since June.

The general manager of Dongguan-based Hayidai Toys Factory said one third of the company's production lines are not running because of a "desperate shortage of workers."

"We have been receiving more orders since June. I'm now afraid of getting calls from clients who don't want us to delay shipments," Xiao said.

Labor shortage hinders Guangdong factories

Migrant workers search posters for recruitment information at Ruian, Zhejiang province, hoping to find a job. [Photo by Sun Lin]

Like Xiao's plant, many factories in the Pearl River Delta (PRD) region have been in short supply of workers following an increase in domestic and overseas orders in the second quarter.

Sources with the Guangdong provincial labor and social security department said the employment situation in the PRD region remained stable in the first half, with the ratio between vacancies and job seekers reaching 1.01 - meaning one person is provided with 1.01 jobs.

"A rising number of big companies like Media and Osram are also hiring new workers following increased business," said Xia Shiquan, a manager with the Zhitong Human Resource Market based in Foshan.

In Foshan, the number of jobs rose from 11,049 in May to 14,806 in June, Xia said.

"We need at least 1,000 new workers. But so far we have hired only about 100," said a manager surnamed Li at a textile factory in Foshan.

The PRD region had been hard hit by the global economic downturn, with many factories closing last year.

However, the recent increase in demand for workers is still not enough to indicate the region's economy has fully recovered, industrial insiders said.

"There are many reasons behind the increased orders. Factories here are receiving more orders that are seasonal, which means they are not necessarily long term," said Zhang Qunkai, a manager at Dongguan-based Huian Human Resource Market.

Most manufacturers have been busy stocking up goods before the end of the year, Zhang said.

"Some workers will have to leave, probably after September, a time when orders usually fall," Zhang said.

Qu Jian, deputy director of the Shenzhen development research institute, attributed the increased demand for workers to the successful restructuring of industries.

"Foreign trade cannot be the only benchmark to measure the region's economy," Qu said.

In Shenzhen, factories have secured more domestic orders since the local government encouraged them to shift businesses from the overseas market to the domestic sector in the first half of this year, Qu said.

Shenzhen's foreign trade was down 17.4 percent to $137 billion in the first seven months, while the added value in the telecommunication, computer and electronic equipments was up 9.9 percent to 89 billion yuan ($13 billion) officials at the local statistics bureau said.

"By focusing more on the domestic market, the economy here is gradually recovering," Qu said.

In sharp contrast, the employment situation for college graduates remains grave in the southern province, an official with the local labor authority said.

As of July, the employment rate for college students in Guangzhou, capital of Guangdong province, was 82 percent, lower than the same period last year, Zhong said.

"The situation has improved since March, when the employment rate of college students was only 23.8 percent, thanks to joint efforts by the government, companies and universities," said Zhong Liying, deputy director of the Guangzhou labor and social security bureau.

Instead of waiting for jobs, some graduates have decided to start their own businesses, an effort to fight the grim job outlook, Zhong said.

Private businesses owned by graduate students could enjoy preferential tax policies for the first three years in business, Zhang said. For young companies that stay in business for more than two years, a symbolic financial aid of 3,000 yuan will be offered.