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PRD wages can’t attract workers

By Cong Mu (Global Times)

10:34, July 05, 2013

The manufacturing enterprises in the Pearl River Delta (PRD) have failed to offer their workers "meaningfully high" salaries, which is one of the main reasons for the region's continuous labor shortages in recent years, a labor and wage expert told the Global Times Thursday.

The wages offered by some companies in the PRD have been higher than the wages in central and western China, but the difference does not translate into a significantly better standard of living for workers hailing from less-developed regions, Su Hainan, vice ­president of the China Association for Labor Studies, told the Global Times.

Su said that Chinese blue-collar salaries have been inflating quickly in recent years, but the increases are reasonable, and companies can no longer rely on low labor costs alone to maintain their competitiveness.

The Chinese Manufacturers' Association of Hong Kong (CMA) issued a survey report of its members in the PRD on Wednesday.

The report indicated that nearly 90 percent of the respondents had experienced labor shortages, and more than 80 percent reported rising operation costs.

A total of 168 Hong Kong-based firms responded to the survey questions on the labor shortage. All told, the respondents still lack a total of 23,114 workers, equivalent to 14.4 percent of their total workforce, the report said.

Last year, the labor shortage rate reported by Hong Kong firms in the PRD was 14.1 percent, it said.

The average inflation of operation costs for the region this year was 13.2 percent year-on-year, according to the survey.

The PRD will gradually become "unsuitable" as a production base for Hong Kong companies, Beijing-based financial news website reported Wednesday, citing CMA President Irons Sze.

Sze suggested that the Hong Kong government should learn from the practices of the Singapore government, building Hong Kong industrial parks in the Chinese inland and overseas.

Although labor costs in some Southeast Asian countries, such as Vietnam, are lower, the mainland is still competitive in terms of the total cost of production, Su said.

The Chinese government is also encouraging low-technology firms to relocate inland so that the PRD can upgrade its industry, Su noted.

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