The end of the holidays for the Lunar New Year represents a critical time for companies in search for personnel. Technological innovation is further influencing the employment market. Young people prefer to work for the home deliveries sector. For the SMEs it is becoming more complicated for the SMEs to find blue collars due to salary treatment and private life management.
04/03/2019, Class Editori - Which picture could better portray the current indistinct work environment in China?
Perhaps the game of Shanghai, with sticks placed randomly on a table, sometimes overlapping, as a representation of the heaps of our time.
Usually, following the Spring Festival, the mobility of personnel in the various production and service sectors multiplies its centrifugal force, putting companies in a difficult position and creating opportunities for job seekers.
But in this new season criticality is reaching its peak. We must begin this analysis from the latest data provided by the China Internet Network Information Center, the organization that manages information relating to the use of the Internet. At the end of the past year, 829 million people were online in China. On the basis of these macro-data, the next extrapolation shows that 817 million users use the smartphone to connect to the internet, of which 222 million live in rural areas.
This crowd of users is subjectively and objectively conditioning the labor market also in relation to the economic situation in an overall perspective, which partially affects the level of growth and which imposes different choices for the near future.
Reflecting the mobility of this kind of users, in 2018 40 million new job posts were created at Alibaba, in the field of online commerce. The jobs are related to retail management of textiles-clothing, home appliances and food. The catering sector is dominating the market with about 15 million meals served daily. Jobs also include R&D, design, production and logistics sectors.
Conversely, the new millennials, positioned in the lower stratification of the production categories, reject traditional factory work in favor of, for example, delivery or home delivery jobs.
This refusal of a traditional job has two main reasons. First, these new occupations does not necessarily require that the workers move from their place of residence (as mentioned before, 222 million users are located in rural areas). Second, for the management of time devoted to work and the salary. Every day, even at the office, you see couriers delivering food and drinks, waiting for the elevator nervously and into a frenzy. Through lunch break deliveries, Luckin coffee has turned into a successful model and a competitor of Starbucks. Their daily run, regardless of the weather conditions, allows them to get a much higher salary (between 650 and 900 euros) than that of a traditional worker in a production chain (between 320 and 450 euros).
Therefore it is difficult to find blue collars personnel, both because of salary and the way to manage private life (the majority part of conventional factory workers generally live in dormitories provided by the same company).
The other essential aspect to take into account is the entrepreneur difficulty to find labor force, if not considering higher salary, but with the risk of decreasing their competitiveness and therefore delocalize the production outside China.
As a matter of fact, the Pearl and Yangtze industrial associations - the most representative ones as for China production - believe that it will be difficult to meet workers’ economic expectations. However, in Dongguan, in the Guangdong province, estimates foresee a lack of 100 thousand workers over these months.
Some years ago, many enterprises chose automation; today, the robotic solution for productions with an interesting added value does not cover the SMEs plethora, even thought a transformation phase is taking place - still not well defined - towards a intrinsically qualitative product.
However, the Belt and Road Initiative, besides the geopolitical point of view, is helping the enterprises localization in the East Africa (clothing and leather manufacturer in Somalia and Eritrea).
Last year, at the Asia Forum annual meeting held in Bo’ao in the Hainan island, I had the opportunity to participate at a dinner with Jack Ma as special guest. I was interested and curious about the topics of his speech, when he discussed about e-business that will have to overcome e-commerce, and that there will not be Made in China or Make in USA anymore, just only the Made in Internet.
At the question ‘Who will manufacture in the future', followed a vague and mostly linked to the Artificial Intelligence concept answer. However, the issue remained unsolved in China as in other parts of the world.
To conclude, one last remark about the employees category, that can still be based in the major centers in mobility.
Technology has always took over and today (in these days) on the screens of elevators and office buildings there is the advertisement of a new app called Boss (a Chinese recruitment app, similar to LinkedIn) regulated by the law of supply and demand for the job research, without the intermediation of websites such as JOB 51.
Which will be the next frontier?
(edited by Marco Leporati, General Manager at Savino Del Bene - transport and logistics company active in China since 25 years.)
(Source:Class Editori)
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