Factory Labor Shortage in China

“You can walk into any factory and get a job."

This statement by a 22 year old plastics worker would not be true in the current American economic situtation. However, as reported in the New York Times yesterday by Keith Bradsher, China is facing an growing labor shortage for several reasons. Factory wages have risen by as much as 20% in recent months, telemarketers are spending their time cold-calling random people to offer them jobs instead of calling customers, and some manufacterors are closing down production lines because of a lack of workers. The main cause for this shortage is that China once drained its interior population to find workers for the blossoming factories in the coastal areas. Now, after a major stimulus from the Chinese government to create jobs in the interior, many workers are not returning to the coast after going home for the Lunar New Year. Two other impacting trends are the rapid exspansion of higher education -- which decreases the number of people looking for factory jobs -- and the One Child Policy.

This shortage has the potential to impact Americans because of the possiblity of higher priced imported goods from China, as the minimum wage might be increased and many bonuses are being offered. Unfortuntely, in the past, higher wages have resulted in inflation for the Chinese economy. The article also reveals a decreasing regional cleavage between the coastal and interior regions. Where the coastal regions were once the economic center, more and more jobs are being created in the interior, often due to government projects like rail and highway construction. Social cleavages are also briefly discussed in the article as those normally accustomed to "white-collar," desk jobs are being forced to participate in more hard labor. However, the Chinese labor shortage could also be a positive factor for the Obama Administration in the renminbi-dollar negotiations.

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Repression

In a recent Economist article titled "What are they afraid of?", the author delved into the topic of China's repressive policies.

The article compares China's political history to its current status. A decade ago, it was thought that China was being forced to integrate with the rest of the world, now the forces causing this seem to be far weaker than was once thought.

Recently, China has been passing long jail sentences for most human-rights activists. The large protest movements in China are mainly related to ethnic tensions. The struggles of the past seem to have been repressed effectively. There is little uprising in China's cities, however, and academic by the name of Liu Xiaobo "was sentenced to 11 years in prison in December,""the heaviest-know penalty imposed on any activist for 'inciting subversion' since such a crime was written into law in 1997."

There was worry about the world economic recession causing frustration among those in China, and possibly causing dissent, but their economy actually grew 8.7%. Also, there is a change of power expected in the next few years, but other than some attempts to gain support for promotions, there has been little evidence of any sort of struggle.

It appears to some that all of the expected transitions are still going as planned, even if they are happening in a slightly different manner than expected, such as the vice president not getting a military post thought to be part of his training to take over for the president. The next leaders are expected to maintain the current situation in China. The political analyst Russell Leigh Moses believe that the question within China's government is "'how much more authoritarian show we be?' not 'how do we embark on a Western-style democracy?'"

Even though punishments have been getting tougher recently, they are not unusual. It follows China's pattern of allowing some free thought, but punishing "those seen as straying too far."

China's leadership is still showing signs of trouble even though the country is doing well. There have been speeches and actions that suggest the current stability is difficult to hold constant. Many feel that the economic advancement and stimulus that seem to be making the country strong and quelling decent will not endure. These same people feel that growth and reform are coming too slowly to allow the status quo to be maintained. "A combination of fast-rising prices and low growth might indeed be enough to send protesters on to the streets."

The current status of repression in China has a massive impact on its ability to become free, the government's legitimacy, and the citizens daily lives. If the citizens are prevented from speaking out against the government, or at least speaking out too much, they will never solver many of their problems. Also, the chances for positive political change are reduced.

The jittery nature of China's political elites also hints at a weakness that could be devastating to them and the world. If it comes from a shaky economy, it could mean a potential collapse that will devastate the world. If it comes from problems with authority, it could mean the destruction of the regime and a loss of all legitimacy.

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