Pearl River Delta Will Encounter Bottlenecks In Textile Industry

Some scholars have pointed out that the reaction of raising minimum wage standards in mainland China and the demand for higher wages by enterprises workers has been taken seriously. It shows that the society is more concerned about the rights and interests of workers and helps to promote social harmony, though this will bring greater pressure to enterprises with low efficiency, pollution and innovation, but it is conducive to the pformation of the Pearl River Delta Industry and the promotion of economic development.

Professor Wei Dazhi, director of the center for industrial economics research of Shenzhen University, said that the Pearl River Delta had mainly focused on economic development in the past, and was not concerned enough about social development. In the past more than 10 years, the wages of workers had not changed much. Workers raised their wages, which could effectively protect the basic living rights and interests of workers, and narrow the income gap of different classes, thus contributing to social harmony.

He also said that improving the remuneration of workers will effectively promote the industrial pformation of coastal cities, and promote enterprises to improve their efficiency, competitiveness and innovation ability.

The Hong Kong businessmen in the Pearl River Delta have said that Hong Kong businessmen are becoming more and more difficult in the Pearl River Delta region. The wage surge has put pressure on enterprises in the Pearl River Delta. Manufacturers can not adjust their remuneration. The labour intensive industries have suffered the most. For example, the textile industry, which was once popular for a time, shifted from Hongkong to the Pearl River Delta in the year to make the textile export of the Pearl River Delta the top of the country.

In Guangdong Province, where most of the Hong Kong businessmen set up factories, the minimum wage increased from 25.7% to 35.6% in 2004 and 2008, and the minimum wage standard was raised again in May. The average increase was 21% higher than the latest increase.

The Hongkong Trade Development Council said that in most cases, manufacturers pay the lowest standard for higher wages to attract new employees and retain existing employees.

However, the minimum wage increase makes workers even expect higher wages and pressure on manufacturers. At the same time, wage levels need to be raised to maintain working staffs, and human resources management also has new problems.

Huang Xingbiao, senior economist at the Hongkong TDC, said that the average wage level rose by about 17% in the past 6 months, and the social insurance premiums paid by employers increased correspondingly with the increase in wages.

For example, the total cost of social insurance paid by employers is roughly equal to 18% of the employees' wages paid by Dongguan, which is concentrated by Hong Kong businessmen.