When it comes to recruitment challenges, Zeng Xiansheng, general manager of China Suzhou Mengshi Intelligent Vehicle Technology Co., Ltd. is quite helpless: “Don’t mention it, isn’t it difficult?”
About 7 million to 8 million graduates come out of Chinese universities each year, with a record 9.09 million graduates this year. However, China’s manufacturing industry is still facing a perennial shortage of workers. In Zeng’s words, young Chinese are choosing the Internet and service industries after graduation, and manufacturing, which they see as “low and uncool”, is at the bottom of the list after express delivery and food delivery.
On the other side of the hiring challenge are rising wages for Chinese manufacturing workers. “There are hundreds of workers in the workshop who earn more than 10,000 yuan a month.” Xia Tiansheng, chairman of Quzhou Hengye Auto Parts Co., Ltd., said the highest-paid worker this month received 14,000 yuan, while the lowest-paid was more than 6,000 yuan.
Higher wages, however, have not solved the labor shortage challenge for Chinese manufacturers.
Nearly 70% of the Chinese companies surveyed are suffering from labor shortages, and 13% are suffering from labor shortages for years, according to the report released by CIIC Consulting, a human capital data center.
Nearly 60% of Chinese companies are short of skilled blue-collar or general operators, while 24% say all of their blue-collar workers are in short supply, the survey said.
Behind the difficulty in recruiting, there is a large gap in the talent matching with the manufacturing industry. And by matching, the willingness of young Chinese to work in factories is increasingly becoming more important than technical ability.
There are “no requirements” for workers, even those in their 60s
In an effort to find workers, Chinese manufacturers have been loosening their hiring requirements.
“All you have to do is finish junior high school and turn 18.” Qian Li, public affairs director at Lenovo’s Lianbao Technology, the world’s largest PC R&D and manufacturing base in Hefei, Anhui province, said the company arranges about two weeks of intensive training for employees before they start work.
According to Zeng, companies have relaxed both educational and age requirements for hiring in recent years. For example, in the past, people over the age of 45 were not employed in the workshop, but now they are in their late 50s. In the past for office or sales personnel requirements above 22 years old university graduation, now did not graduate 20 years old can; Academic qualifications are basically not to see, “in the past will be required to graduate from university, now the only condition is to do things well.”
To meet the increased orders, Quzhou Hengye expanded a production line after starting work this Spring Festival, and the recruitment of staff for an additional shift took longer than expected. Even young Chinese graduates from vocational and technical schools are reluctant to work in factories, let alone Chinese college graduates, Mr. Xia said. As a result, they are also expanding the requirements, “sometimes it is not possible, people in their 60s May also be hired.”
According to the report, about 70 percent of Chinese companies have responded to the labor shortage by expanding recruitment channels or expanding forms of employment.
In addition to education and age requirements, Chinese factories have been lowering the skill requirements of their workers, in an effort to broaden the pool of qualified workers.
Chen Yuyan, secretary of the board of directors of Zhejiang Zhuji Intelligent Control Technology Co., said the factory has consciously reduced the requirements for skilled workers through automation. “Those ancillary jobs can be done very easily with automated machines.”
More than ten thousand salary and year-end bonuses and dividends
In addition to relaxing recruitment requirements, expanding recruitment channels and broadening employment patterns, most Chinese manufacturing companies are raising salaries and benefits to attract “scarce” workers.
On the afternoon of April 21, the Human Resources and Social Security Bureau of Zhuji City, one of the top ten industrial counties in Zhejiang Province, brought 26 enterprises and more than 1,000 jobs to Zhejiang Sci-Tech University in Hangzhou. The highest annual salary offered was as high as 800,000 yuan.
In addition to the case of 800,000 yuan a year, it is not uncommon for many blue-collar jobs to earn more than 10,000 yuan a month, which is not inferior to some popular Internet or service jobs.
“Now, whether the company is profitable or not, they talk to employees about year-end bonuses. Thirteen or 14 is the norm.” Zeng Xiansheng said that the company’s current salary structure is base salary plus performance plus monthly bonus. “In the past, China’s manufacturing industry rarely had dividends, but now they want to open it.” That is to say, as long as employees perform well, the company will pay more money to employees when they make profits.
In addition to salaries, performance and dividends, as well as state-mandated five social insurance and one housing fund payments, Chinese manufacturing companies are also offering increased benefits to their employees.
“Now there are many items such as birthday party, tour construction fee, travel fee for returning home, all kinds of holiday fee, and welfare for employees.” According to Mr. Zeng’s back-of-the-envelope estimates, these seemingly insignificant individual expenses add up to about 20 percent of the cost per employee. Add in wages that are rising by about 10 percent a year, and labor costs start to make up as much of a business’s total cost as rent.
According to the report, more than 70 percent of Chinese enterprises will raise the salaries of blue-collar employees by 2020. Among them, more than 40 percent of Chinese enterprises’ salary adjustment range is less than 5 percent, and more than 20 percent of Chinese enterprises’ salary adjustment range is 6 to 8 percent. It is expected that nearly 90% of enterprises will adjust the salary of blue-collar staff this year, up 13 percentage points compared with 2020. Among them, enterprises with a salary range below 5% account for the same proportion as those with a salary range between 6% and 8%, both reaching 38%.
According to Chen, the company has always provided comprehensive benefits, with a flexible mechanism for paid leave and vacation adjustment. Since the second half of last year, the company has also increased the annual expenditure of nearly 5 million yuan to provide three free meals for employees. “Considering that young people may have poor control over consumption, the company provides free meals so that at least they don’t have to worry about eating at work.” At the same time, the workshop environment is also improving, some specially installed air conditioning and other facilities.
“Generally speaking, the effect of pushing the needs of Chinese manufacturing companies to colleges and universities is not very satisfactory,” said Cai Jiannan, Talent Employment Section of Zhuji Human Resources and Social Security Bureau, so they will do a lot of communication and homework in advance. For example, they will focus on this recruitment. Look for those graduates who have come to Hangzhou from outside Zhejiang Province to study, hope to stay in Zhejiang but the cost of staying in Hangzhou is too high, or young people from Zhuji. “Just try it!”
When it comes to recruiting Chinese manufacturing workers, Cai believes that the government and universities are supportive, but in the end, it is up to the enterprises themselves. What the government can do is mainly to help enterprises communicate well in the early stage and bring enterprises and their demands to provinces and universities with the large demand for exporting employees.
In the afternoon of the special recruitment fair, Zhejiang Chuangge Technology Co., Ltd., Zhejiang Liufang Carbon Technology Co., Ltd., Zhuji Hangfeng Knit Textile Co., Ltd signed a contract with Zhejiang Sci-Tech University respectively, to build an employment internship base, the purpose is also to better attract young people.
The main reason is the low willingness of young Chinese to enter factories
According to the report, 90 percent of Chinese companies believe that the shortage of blue-collar workers is caused by young Chinese people’s low willingness to take up front-line blue-collar jobs.
“Young people who have the ability don’t want to come. They can’t come without the ability.” Zeng said that even though the salaries offered by manufacturing factories are more competitive than those offered by some Internet companies, they still prefer the latter.
In Zeng’s opinion, the reason behind young people’s low willingness to enter factories is that Chinese society generally does not respect operators or craftsmen who rely on technology to make a living, and so-called “blue-collar” workers in China do not have enough dignity. Such discrimination can be even worse among young people.
Chen attributes young Chinese’s reluctance more to the “love of freedom.” She believes that today’s young people like free work and have a high demand for the free use of their time. So emerging services such as delivery, food delivery and ride-hailing are more attractive than factory jobs. After all, factories still have to work overtime to meet production requirements, and sometimes have to work shifts.
“The management of workers in our workshop is relatively military-style. They have to come to work on time and don’t use their phones during work.” Qian Li clearly felt that the rise of the tertiary industry had an impact on the choice of Chinese young people with intermediate education levels in the manufacturing industry. A large number of young people were diverted by richer and freer choices.
Compared with ordinary white-collar work, Xia also believes that factory work is hard after all, “a month may have to work 28 days, maybe 10 to 12 hours a day.”
Liu Yong, from Jiangxi province, was born in the 1990s and worked as a general laborer at Foxconn in Shenzhen from 2011 to 2015. Talking about why he left Foxconn manufacturing industry, Liu Yong said that the main reason is that overtime is often black and white, the biological clock is disrupted, the body can not stand. Another reason is that the manufacturing industry is mainly based on factories, with repetitive and boring work procedures, high intensity, small promotion space and low level, “girls or mothers-in-law don’t like it”.
Influenced by online articles such as “Young people should not be content with the status quo, but should be brave enough to jump out”, Liu Yong decided to resign. After leaving the factory, he started a restaurant and then moved to a delivery company to work as a truck driver, earning 6,000 to 7,000 yuan, slightly more than the 5,000 yuan or so he made at Foxconn. However, he said, now as a driver, work flexible time is more, but also can develop different part-time jobs, such as helping others to deliver goods, after work can also run takeaway, salary and part-time part-time income can sometimes reach 10,000 yuan a month.
“It’s impossible to be a blue-collar worker in the factory anymore. I can’t sit still.” “Liu Yong said.
Promoting managers born after 1995, turning blue-collars into purple-collars
Since the lack of willingness of young Chinese to enter factories is the main cause of the labor shortage, the report suggests that companies should strengthen the management of new blue-collar workers, pay more attention to the promotion and development of blue-collar workers and the training of skilled personnel, while ensuring adequate compensation.
This is indeed the direction that many Chinese manufacturing enterprises are trying to improve.
“We now actively promote executives born after 1995 and let young people manage young people.” Zeng Xiansheng said that people born in the 1970s used to be in charge of human resources and administration, but now they are young people born in 1998. Now, half of the managers in factories are born in the 1990s, while three years ago, it was new for them to be executives.
Lenovo group launched its “purple led project” on March 25, which aims to let education, Lenovo supply chain and the company cooperate with the public welfare foundation, through professional skill talented person growth stages, thus forming in conformity with the requirements of the intelligent manufacturing is familiar with the actual manufacturing process and understand the corresponding technical theory, Compound talents with both operational ability and management innovation ability, also known as “purple collar” talents.
“It is equivalent to giving young workers a chance to go to university.” Qian Li said.
In this year’s China national two sessions, the CPPCC national committee, economic committee, deputy director of the CPPCC national committee MiaoWei said, to speed up the construction of supporting the development of China’s manufacturing high-quality talent team, well versed in “technical workers – skills talents – skills – craftsmen of the great powers” the growth of the channel and development path, let employees have a way out and look forward.
Under the emergence of the pandemic, unmanned factories, intelligent workshops, intelligent logistics and other new models accelerated penetration and popularity. For Chinese enterprises, it is the only way to upgrade China’s manufacturing industry in the long run by introducing more intelligent manufacturing to reduce the reliance on labor for some types of work.
Source: China Business News