Wu Guangqiang ONLY a few years ago, it never occurred to even the wildest guesser at home or abroad that China would one day be short of labor. Since China set off on its journey to modernization in 1979, Chinese workers have toiled for a tiny fraction of the pay of their Western counterparts. Chinese workers’ strong backs and nimble fingers have filled the globe with cheap and durable goods ranging from shoes, toys to computers and cell phones. In recognition of Chinese workers’ great contributions to China and the world, on Dec. 16, 2009, “the Chinese worker” ended up ranking second in Time magazine’s “Person of the Year.” The magazine lavished praise for their diligence, hard work and bravery, giving them the credit for helping China maintain a robust 8 percent growth and helping the world with economic recovery. Well, all good things must come to an end, as they say. China is entering a labor shortage at an unexpectedly fast rate. My first personal impression of the shortage came from my home. The nurse who had attended to my mother for years quit two years ago and my sister began a lengthy task of hunting for a new nurse. With fewer but more selective applicants, it was more of a matter of nurses choosing employers. Since then, five have come and gone. Even higher pay can hardly retain one. Companies more keenly feel the pinch. Right after the Chinese New Year holidays, factory recruiting teams began to fight tooth and nail to grab any potential applicant. The pot has been sweetened with a big pay increase and better working and living conditions. But employees are still few and far between. The labor shortage is particularly overwhelming in developed parts of China. In Guangzhou, every jobseeker has 1.36 job vacancies to choose from. One month after the Spring Festival, Guangzhou was short of 150,000 workers and Bao’an District in Shenzhen needed an extra 200,000. A host of factors have worked together to bring about the shortage of labor. First, the accelerating development of western and middle parts of the country is encouraging local rural folk to work closer to home. Second, as a result of long-time adoption of the one-child policy, the number of young workers fell. Third, the new labor law, introduced in 2008, along with workers’ growing rights awareness, has supported workers’ demands for higher pay and more respect. They no longer take a lowly paid and arduous job easily. Looking at this new development positively, I hail the labor crunch. China’s economy has long relied too much on fixed asset investment and too little on consumer spending. As the backbone of the Chinese economy, workers have received such a small slice of the national income cake — 53 percent in 2007, down from 61 percent in 1990 — that they hardly have enough money for food and shelter, let alone to spend on non-essential goods. Allowing wages to rise would allow workers to enjoy more of the fruits of their labor. Higher wages in China would also be a boon for the West. The rich world has relied on cheap Chinese labor and greatly benefited from it. By one estimate, trade with China has added US$1,000 a year to the pockets of every American household, thanks to cheaper goods in the country’s stores, cheaper inputs for its businesses and stiffer competition in its markets. Higher Chinese wages might start to export inflation, but it will not be a bad thing, because more money in workers’ hands will lead to more spending. A 20 percent rise in Chinese consumption might well lead to an extra US$25 billion in American exports. That could create over 200,000 American jobs. It looks like the shortage will be a chronic one, so many fear this will take a toll on China’s competitiveness and even on the global recovery. I’m quite optimistic though. Before long, more skilled and intelligent workers will take the place of those less skilled to make China a technically advanced country, which, in turn, will benefit the world as a whole. (The author is an English tutor and a freelance writer. He can be reached at jw368@163.com.) | 