Factories short of workers in Xmas run-up

Chinese factories are racing to hire migrant workers laid off during
the global crisis as they struggle to meet Christmas orders for
Barbie dolls, iPods and designer jeans, say analysts and observers.
The surge in demand has caused a labour shortage in some parts of the
country as factories ramp up production, but does not necessarily
mean that China's key export sector is on the mend, they said. "The
shortage is primarily due to a short-term misalignment of demand and
supply due to a sudden upswing in demand probably fuelled by the
arrival of Christmas orders," Ren Xianfang, a Beijing-based economist
at IHS Global Insight, told AFP. "The high-level labour intensity of
most of the export-oriented manufacturing industries means that
either the reduction or increase of new orders will cause quite big
swings in labour demand, which explains the sudden job losses and
just as sudden resurgence of demand." Nearly 20 million migrant
workers lost their jobs at the start of the year as factories closed
or slashed production in response to plummeting export orders from
key markets in Europe and the United States. While the government
says 96 percent of those people have found new jobs in the cities,
the still-weak export sector suggests many of them have gone into the
construction industry or stayed home where economic conditions are
improving thanks to massive government spending, analysts said. "The
country's interior provinces have benefited from fiscal stimulus
projects and stronger local economies," said Ben Simpfendorfer, a
Hong Kong-based economist at the Royal Bank of Scotland. "The logic
for travelling thousands of kilometres to a neighbouring province is
thus less compelling." In southern Guangdong province, China's
manufacturing hub, factories are facing a " serious" labour shortage
amid the flood of Christmas orders, said Xu Jiang, manager at the
Hui'an Human Resources Service Centre in Dongguan city. "Demand for
workers is rising but many migrant workers did not come back from
home (after being laid off)," Xu told AFP. "Some simply will not come
back here after finding a job at home." Many migrant workers were
choosing to stay home to take advantage of improved conditions
created by the government's four- trillion-yuan (585- billion-dollar)
stimulus package, unveiled last year, Xu said. The workforce shortage
has forced factories in Wenzhou, in eastern Zhejiang province, to
offer free meals, air-conditioned dormitories and extra holidays to
entice migrant staff, state media reported. Wang Ouxiang, deputy
secretary of the Employment Service Centre in Wenzhou, said there
were 150 ,000 job vacancies in the city. "Factories in the city are
thirsty for labourers," Wang said. Pressure on factory owners was
more intense than usual this year, Simpfendorfer said. Foreign
retailers had delayed placing Christmas orders until September due to
the uncertain economic outlook and were demanding shorter delivery
times so they could keep inventory levels low, he explained. "Orders
have been bunched into a single month -- they usually start coming in
as early as July," he said. "The labour shortages are not necessarily
a sign of a fast recovering export sector, and while export orders
have strengthened, they may yet relapse."