China companies try new measures to keep staff from fleeing

China companies try new measures to keep staff from fleeing

Friday, Dec 20, 2013

Qiu Quanlin

China Daily/Asia News Network

Chen Zhongwei has had to shift some of his processing business to factories in inland areas due to a shortage of workers in his company, located in the traditional manufacturing hub of Dongguan.“A growing number of workers have resigned since the start of December,” he said.

“They are returning home to celebrate the Chinese New Year.”

Apart from moving some business to inland areas, Chen, general manager of Dongguan Wivtak Electronics, also had to work out means to hire new temporary workers to sustain manufacturing operations in the Dongguan factory.

“It’s hard to find qualified and skilled workers,” he said. “Most workers are looking for new jobs next year, rather than working temporarily at the end of the year.”

According to Chen, nearly 30 per cent of the 800 workers in his factory have considered quitting their jobs since December.

“They may not come back after the Chinese New Year holiday, as the working conditions in inland areas have improved. I am more worried about a worsening employment situation in Dongguan next year.”

Improved working conditions in inland cities, especially increased pay, and lower demand from overseas, have made Dongguan, a traditional processing and trade hub in the Pearl River Delta, a tough place to keep skilled workers.

Chen’s company opened two subsidiaries in Hubei and Hunan provinces several years ago due to increased labour and production costs in Dongguan.

“As the company is headquartered in Dongguan, which still has a sound industrial infrastructure and lower export costs, we have to work out effective measures to hire workers to keep up smooth operations,” Chen said.

For example, he said, the company offers allowances for senior workers.

Other companies in Dongguan also have started to provide more comfortable working and living conditions for workers.

To tackle the shortage of staff, Chen’s company has also introduced automation to increase production capacity.

However, a growing number of workers, most of which are from inland regions, are leaving the city. But not all are leaving just for economic reasons.

“I want to spend more time with my parents,” said Wang Weifeng from Hubei province.

The 19-year-old quit his job at a shoe factory in Dongguan’s Liaobu township and left for nearby Shantou where his parents work.

“Living costs in Dongguan are high,” he said. “I’m going to study at a technical school in my hometown.”

Most migrant workers in Dongguan were born in the 1980s and 1990s, according to Wang Qian, a consultant with Chitone Group, a human resource provider.

“Unlike their parents, this group of post-1980s generation workers cares more about decent working conditions and they change jobs frequently,” he said.

As the number of available workers has fallen in the last decade, he said factories struggle not only to find new employees, but also to retain existing staff.

Sources with the Guangdong Labor and Social Security Department said companies in the province, especially in the prosperous Pearl River Delta, experienced a surge in demand for workers in the third quarter of this year, after a slight recovery.

The average number of workers in the Pearl River Delta was 1,277 for each company in the third quarter, an increase of 6 per cent from a quarter earlier, according to the labour authority.

It also said the average monthly pay for skilled workers in Guangdong increased year-on-year by 6.3 per cent to 2,744 yuan ($450) in the third quarter.

“We had to retain workers by increasing salaries by about 20 per cent this year,” said Zhang Xingming, general manager of Huidong Youme Shoes.

Zhang, whose factory is in Huizhou, a booming manufacturing city neighbouring Dongguan, said there has had been no shortage of workers in his factory.

“The shoe business here has been relatively stable this year. Skilled workers don’t have many job chances as Huizhou concentrates on the shoe industry,” he said.

Zhang’s factory is surrounded by hundreds of other shoe manufacturers in Huidong county.

“Workers here are skilled in shoe manufacturing and we provide comfortable working and living conditions to retain them,” he said.

He attributed the shortage of working staff in Dongguan to a vast variety of industries in the city, dubbed one of the manufacturing hubs of the world.

“For example, workers in Dongguan often change their jobs, say from an electrical company to a garment factory, for better working conditions and a pay rise,” Zhang said.

“The frequent change of workers will, of course, lead to a shortage of staff for some companies that offer lower salaries.”