Tuesday, April 04, 2006

When 1.3 Billion people is not enough?

According to this story in the New York Times, when you are China's economy.
The story talks of how there are labor shortages in some provinces of China--notably the Pearl River Delta (adjacent to Hong Kong), as Chinese are either A. taking higher paying jobs in the Shanghai area, B. taking (close to) decent paying jobs nearer their homes, or C. staying on the farm because of agricultural tax reform.
The story talks up China's labor force as "moving up the production chain"--essentially how China's workers are rapidly becoming more skilled, and capable of engaging in high-order work.  Moving beyond the George Jetson button-pushing/lever pulling/hammer swinging work and into things that require more skills. 
As evidence of this, the story says that in 2006 Chinese universities enrolled 14 million students--up from 4.3 million who enrolled in 1999.
Granted, the story was focused on businesses in the Pearl River Delta, but it still seems to miss the point that nearly quadrupling the number of college graduates in only 6 years is going to put enormous pressures on an economy.  The people who are "moving up the production chain" aren't exactly making it any easier for Chinese college-grads to get jobs at home.  In fact, it is usually the college grad's parents who are moving up, and then competing with their children for jobs. 
As one friend of mine, who has taught at a Chinese University for the past 8 years or so describes it, the job market for this year's graduating class is not good.  These aren't philosophy or poetry majors.  They are students who have majored in English.  Most of them speak it well and read it better.  They are trained as teachers.  In theory a sector that an up-and-coming economy would have booming--as new schools opened up, or increased tax revenue (from 10% economic growth) pushed more money into education, allowing class sizes for elementary schools to fall lower than their current level in the mid-50s.  But it seems to not be the case.
Interestingly enough, the story of the job-seekers market, and the consequent improvement in wages and working conditions comes at the same time as a push by China's government supported trade union seeks to unionize 60% of foreign invested companies in the next year.  I'm no union organizer, but wouldn't it behoove the unions to go out and organize before employment conditions improved on their own because of the market?

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