Job Dissatisfaction

It used to be so popular that companies needed to pay 800 yuan (US$116) to rent a booth and draw on local connections to be assigned one. This year, the fee dropped to 100 yuan (US$15) and the city’s human resources center made posters for free. Walk-ins received a small gift package. The Yongkang government offered lottery tickets totaling 10 million yuan (US$1.4m) to workers who came or returned before January 30. 　

Traditional manufacturing provides half of Yongkang’s jobs. The city produces 80 percent of China’s vacuum vessels like flasks and cups, 70 percent of doors for homes, and 40 percent of its power tools. Workers come from other provinces like Yunnan, Guizhou and Hunan. In 2022, the non-permanent population in Yongkang was 549,500, while its permanent registered population was 621,000. 　

Yongkang is not alone. After China eased its zero-Covid policies and the economy started to recover, factories with outstanding orders expected production to resume at full capacity. But some coastal regions with concentrations of labor-intensive industries, such as Zhejiang, Jiangsu and Guangdong, face an acute shortage of workers. 　

Previously, workers returned en masse to factory jobs at the end of the Lantern Festival, the 15th day after Lunar New Year, which fell on February 5 in 2023. This year, workers did not flock back, preferring to take a wait-and-see approach, according to employers at Yongkang’s job fair. “This Lunar New Year was the first time they’d gone home in three years [due to Covid]. Besides, the bleak situation of factories last year really makes them pessimistic about what to expect this year,” one of the employers told NewsChina. 

“We prefer workers between 18 and 40, but it’s much easier to get workers between 40 and 60, who really need a job and are reliable,” Wu said. 　

Wu explained that workers over 40 are less educated and require longer training. He knows that young people have more options across many industries, so manufacturing no longer appeals. 

Ying Zhencong, HR manager at Wonly, a security door brand based in Yongkang, told NewsChina that it is harder to retain young workers. Many new recruits leave after their two-to-six month probationary period. 　

Ying, who has been in charge of recruitment since 2014, said finding staff used to be easy. “We’d just put posters on the gate, and workers showed up.” But for the past two years, they had to go to job fairs and other events to “fight for” workers. 　

Cheng Mingsong, vice manager of Buyang Group, a door manufacturer listed in Hong Kong, told NewsChina they had recruited nearly 300 new workers by February 8, but still had vacancies for labor-intensive and technical posts. It is particularly difficult to recruit technicians, he said. 　

Li Tao, an instrument manufacturer in Nanjing, Jiangsu Province told financial magazine Caijing in February they had experienced labor shortages in the past few years, but this year the situation is worse. They mostly need frontline blue-collar workers. He said that college graduates are not willing to do technical work and many migrant workers are leaving cities to return home because of the increased cost of living. 　

Small- and medium-sized enterprises (SMEs) are worse off. Since the end of the Lunar New Year holiday, Yuan Yonghua, a manager at a luggage producer, has been busy shuttling between job fairs. His factory still needs 40 assemblers and dozens of punch press workers, packers and cleaners, a gap of 20 percent. They particularly need young people under 25. 　

Yuan told NewsChina that factories in Yongkang rely on workers from Yunnan and Guizhou provinces in Southwest China. The primary source of labor for Yongkang used to be Zhenxiong County in northeast Yunnan. At the peak, 200,000 workers came from the county. 　

“Many factories would have closed if it weren’t for workers from these areas,” Yuan said. But in recent years, national poverty alleviation campaigns have been effective. Fewer people are willing to work in huge cities as they can find jobs closer to home. 　

“This year, more workers returned home. Many factories did not perform well last year and so they let workers go early. A lot of factories still don’t have solid orders yet, and only big companies have fully resumed production. Many workers who left last year are still biding their time to see how things pan out,” Yuan said. 　

To secure labor supply, some local governments like Yiwu in Zhejiang Province, known as “China’s workshop” for small goods, encouraged workers not to go home for the Lunar New Year. After the holiday, coastal provinces like Zhejiang, Jiangsu and Guangdong offered incentives to attract workers back quickly, including subsidies. Cities like Ningbo and Fuzhou even chartered flights and sent representatives of local enterprises to Yunnan and Guizhou. 

Between 2010 and 2021, the proportion of migrant workers in manufacturing shrank for 11 years in a row, from 36.7 to 27.1 percent, according to data from the National Bureau of Statistics (NBS). 　

In Yongkang, the number of young people under 25 seeking work decreased by 20 percent compared with 2022, Yuan estimated. There is a big difference between people born after 2000 and the 1970s and 80s. Mostly only children, they live a good life and their parents take good care of them. They feel less pressure from life and “don’t think twice about quitting a job,” Yuan said. 　

Several interviewed company managers suggested that many young factory workers lack the adventurous spirit and industriousness of their predecessors. 　

Wonly’s production director Li Tingqian, who was born in the 1980s in Yunnan Province, said he lined up for hours in the rain at the firm’s factory gate over 20 years ago. “It was difficult to get [work] in factories then,” he said. 　

Cherishing the opportunity, Li worked hard as an assembler. His diligence sent him through the ranks, from team leader to workshop chief and eventually factory manager. At Wonly, there are around 50 workers like Li who have stayed there for over 20 years and earned equity-based incentives. 　

Ying told NewsChina that now it is common for young workers to leave without passing their probation. “Being a technician requires a lot of training before you can earn a good salary. Some positions require one to be an apprentice for at least half a year. Many young people don’t want to wait so long,” Ying said. Young people do not want to invest time in training for a job, when they can easily get part-time or other temporary jobs, he said. 　

Factory salaries, usually lower than the service industry for non-technical workers, are just one factor that discourages young people, Ying said. 　

Compared to being a delivery driver or courier, working in a factory is more like school, with strict clocking in and out, and no free time during the day, even when wages are higher than gig economy jobs. “So even though a technician might earn over 10,000 yuan (US$1,448) a month, it’s not attractive to them,” Ying noted. 　

Factories are losing out to rapidly expanding service industries that allow young workers more options. “China’s service sector, which remains labor intensive, will play an increasingly larger role in absorbing labor. It’s an irreversible trend,” said Sun Wenkai, a research fellow of National Academy of Development and Strategy at the Renmin University of China in Beijing. 　

Factories can be noisy, dirty and polluted, and may require heavy manual labor. Unlike older generations who put up with it, young workers do not want to risk their health to work in a dreary, repetitive job. 　

In Yongkang’s door industry, for example, workers print designs on security doors, which involves toxic heavy metals and pigments. It was a job workers scrambled for 10 years ago. Now, as older workers age out, it is hard to find replacements. As a result, unskilled females over 40 and males over 50 are overlooked by factories. 　

Despite of that, the proportion of migrant workers aged bove 50 increased from 17.9 to 27.3 percent between 2015 and 2021, while young workers between 21-30 dwindled from 29.2 to 19.6 percent, according to the NBS. 

While the cost of living is high, the business situation is tough, particularly for original equipment manufacturers (OEM) that have to swallow plummeting margins as competition ramps up. Workers hesitate to return to some factories over worries about the sustainability of the business. 　

Take thermos flasks, for example. In Yongkang alone, there are nearly 1,000 companies producing vacuum cups and flasks, a field with a low technical threshold. They are mostly OEMs for cup brands who sell on e-commerce platforms. 　

Wang Meng, in his 30s from Hubei Province, opened a vacuum cup factory in Yongkang in 2019. He said their income is at the mercy of brands. “We usually get 30 percent of the retail price, but sometimes 20 percent.” 　

In the first two months of 2023, his orders rose 30 percent year-on-year, but profits were down. Wang said he could earn 3-5 yuan (US$0.43-0.72) from one cup, which may retail for 30-50 yuan, but now it is almost 10 times less due to fierce competition. 　

“To win orders, we need to provide the best quality, the cheapest price and the best service,” Wang said. 　

Yet he is in a better situation than some other SMEs in Yongkang, which are still waiting for orders to resume production. For them, the uncertainty over orders is a bigger problem than labor shortages. 

“We have 19 assembly lines that used to have 13 workers each. Now, machines do 60-70 percent of the job, taking the place of dozens of workers,” said Wu Xing, vice president of Haers. 　

Wonly started investing in intelligent production in 2015 to reduce costs and improve efficiency. They spent more than 20 million yuan (US$2.9m) on five punching machines, an enormous investment for them. Now many of the procedures are run by machines. 　

Huang Yu, an associate professor at the Minzu University of China in Beijing, said the wide use of smart manufacturing does not enhance the technical skills of workers. Rather, it shortens their training time and changes the division of labor. In factories that use smart machines, ordinary workers only need to take care of loading and unloading, while technicians are in charge of machine debugging and maintenance. 　

Wu Xing told NewsChina that welding the necks and bottoms of bottles used to be a technical job. Now with machines, less skill is required from workers. Instead, they need more technicians to maintain the automation equipment. 　

But using smart machines is not yet a viable option for many companies. Unlike producing highly standardized products like cups, door factories produce hundreds of batches of doors daily in varied designs. It is still impossible for a machine to produce thousands of types of doors. 　

Besides, the cost of using smart machines remains too high for products with low added value and produced in small quantities. “For example, it is not worthwhile to use machines to produce bags worth no more than 20 yuan (US$2.9). Many companies dare not take that risk,” Yuan Yonghua said. 　

Yuan added that for products with high profit margins exported to Europe and the US, replacing human labor with machines will bring more returns. But for SMEs that are less financially sound, it is hard to make the transformation even with government subsidies. 　

“Part of our punching work is done by machines now. But our assembly line still relies on human workers, because changing that involves tremendous investment and we are not sure if it will pay back in efficiency,” Yuan said. 　

Before machines take over full-scale, factories will have to remain appealing to young labor. “Besides income, young people are increasingly considering how they feel about a job, whether it brings respect, and their work environment. Factories need to figure out how to improve these factors if they want to keep young workers,” Sun said.