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Comment by shimon_e | Hacker News Reader

So much China discussion today.

"Suffice it to say that a large swath of manufacturers in coastal provinces such as Guangdong, Zhejiang, and Jiangsu has not been able to attract and retain workers."

Actually what is happening is these regions never had a surplus in unskilled labourers. They were depended on migrant labour and since 2011 the government has put strict limits on the migrant labour. Limits much lower than demand. By 2016 migrant labour is to be stopped to major cities in these provinces. It is all part of the current 5 year plan. The desire of the government is to get low value manufacturing out of these regions. As it believes the economy has develop beyond the need to depend on such manufacturing. This is an intentional move. It is not due to a change in worker attitude or slowing economy.

http://en.wikipedia.org/wiki/Five-year_plans_of_the_People%2...

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A bigger reason is that migrant workers can now find more opportunities closer to home. Why bother moving to a coastal city when you get a decent job in a city near your village? Perhaps building more factories inland is part of the 5 year plan, but I see it as an inevitable progression in China's development.

The inland factories are not the same type of low value factories that covered the coastal regions. Those factories depend on low labour costs and low logistics cost to be able to produce tons of junk; to be sent all around the world and sold for cents in stores all around the world. The inland factories came from major investments made in building sophisticated factories and supply chains inland.

Its a bit more of both I think. The SMEs* on the coast are moving production inland to take advantage of human and natural resources. They haven't gone into villages yet, but definitely into cities like Chongqing, Wuhan, Lanzhou, Urumuqi, the supply chains follow (which are also SMEs).

The big blocker to this movement so far have been coastal export zones, where import tariffs on supplies are waved as long as the production must be exported, which is why we in China pay so much for things "made in China." But as China produces more for its own domestic economy, that becomes much less relevant.

* Small and medium scale enterprises, usually private, compared to the massive SOEs (state-owned enterprises) and JVs (joint ventures).

I'm talking a lot less professional than SME. More like the equivalent to a lemonade stand in the manufacturing world. Those businesses won't make it inland without some logistics miracle. If you are involved you know what I mean.

I'm not sure, like-kinds of small business always cluster together to solve logistic problem. The side effect here is that its a race to the bottom since all of these guys are doing pretty much the same thing. Its not sustainable even on the coast, I think.

It appears your link is incorrect and perhaps that's why you were downvoted.

Working link: http://en.wikipedia.org/wiki/Five-year_plans_of_the_People%2...

Thanks.

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