Han Zhe: How Can The Labor Intensive Textile Enterprises Be "Able To Live"?

According to media reports, the NLD's investigation in Guangdong found that some local private enterprises had only 3%-5% of industry profits, and the enterprises had no intention to raise their wages.

Therefore, the people's Republic of China suggested that under such circumstances, the government should allow enterprises to reduce taxes on business tax and other taxes, leaving more profits for enterprises.

From top to bottom, the whole nation is talking about "income distribution reform", no matter what the path and schedule are, and the consensus of "change" has been formed, which in itself is a very gratifying thing.

But at the same time, we should also be cool to see that in the case of export - oriented + labor-intensive industries still dominate China's economy, it is not an easy task to improve the income of workers.

Because the competitive advantage of labor-intensive enterprises lies in the low price, which lies in the low cost of labor, which to a certain extent is a dilemma for improving the income of laborers.

Enterprises with a profit margin of only 3% are undoubtedly those labor-intensive enterprises at the lowest end of the global industrial chain. They have limited space to increase their income for workers.

In the face of fierce global brands and distributors, these enterprises have no bargaining power, and profits will only become smaller and smaller.

Therefore, in labor-intensive enterprises, the increase in salary is largely a luxury, because it can not be added.

So, this leads to a hamlet question: is it a labor-intensive industry, or is a laborer's income increase?

Based on this, the NLD suggests that the government make profits in order to take account of the above two factors.

Indeed, in the distribution of national income, the government has a big head, and the call for the government to give up profits has been very intense since the beginning of the reform of the income distribution.

Therefore, if the government can make profits and reduce the tax burden of enterprises, theoretically, enterprises will have room for increasing wages, and ultimately, the state will benefit the people through giving benefits to enterprises.

However, past experience tells us that the government's benefits and labor-intensive enterprises may not be able to survive.

For example, the export tax rebate is a very obvious example.

When the economic crisis raged last year, the state raised the export tax rebate rate for various products, and the textile was closer to zero export tax rate.

However, the profit margins originally left to enterprises were taken away by foreign businessmen. Most foreign trade enterprises basically gave export tax rebates to foreign businessmen in order to keep orders.

At that time, quoted the director of a Henan textile enterprise as saying, "when the price negotiation is conducted, no matter what price the enterprise gives, the first sentence of the other party always says that the state has raised the export tax rebate and has asked the enterprise to reduce the price".

Due to the lack of bargaining power, we have reason to worry that the profits given by the government to the enterprises will once again be coercion by foreign businessmen and become the source of their increasing profits.

Because our labor-intensive products have no other advantages, they can only be passively accepted.

Therefore, while studying how to increase the income of labourers, we need to consider the pformation of the economic structure. Only when the economy is pformed and the income of labourers will rise, will they not be constrained by the low end of the industrial chain.

We need to abandon the inertia of cheap labor. Just as Yao Jian, a spokesman for the Ministry of Commerce, said at a regular press conference yesterday, the most important factors in attracting foreign investment in China are political stability, economic development and the continuous improvement of the legal environment, followed by the huge market size and perfect Industrial matching capability.