Rising Labor Costs Force Local Textile Companies To Explore Productivity

The rising cost of manpower is a common problem faced by all industries in China, and the situation is more severe for the labor-intensive textile industry.

Data show that the per capita wages of textile enterprises in the southeastern coastal areas of China have increased by about 20%.

According to Zhou Haijiang, chairman of the red bean group, the group's wage level was raised by 49.6% in 2010.

Even in the case of rising wages, many enterprises still have difficulty recruiting workers.

Some garment enterprises that have completed primitive accumulation, such as YOUNGOR and Shanshan Group, are going to the real estate industry.

Tianhong Textile Group is one of the largest suppliers of core cotton textiles in the world. Hong Tianzhu, chairman of the company, said at the Forum: "cost is always the core issue of the textile and garment industry. China's textile enterprises can make some targeted choices in light of their own conditions.

Tianhong textile is the beneficiaries of capacity relocation. As early as 2006, it invested and built factories in Vietnam. Now it is preparing to build second factories to pfer more manufacturing business to Vietnam.

Based on the convenience of raw materials import, low labor costs and favorable local tax incentives, the profits of Tianhong Vietnam factory are even more impressive than that of domestic factories.

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China Textile Information Center insiders told reporters that this year's textile and garment enterprises are not having a good time. In addition to soaring raw material costs and rising labor costs, "no order" or "dare not take orders" is the biggest worry of textile enterprises in recent years.

"It is very common for European and American buyers to turn their orders to Southeast Asian countries. Now many local enterprises are also considering investing in factories in Vietnam and Bangladesh, and they are responsible for R & D, design and other businesses in the country."

Insiders suggested that the location of enterprises relocation in different industrial chain links should be different from the perspective of concern.

For cotton spinning enterprises, cotton resources are the key to choose the investment place. For garment enterprises, there must be sufficient supply of local resources.

The above China Textile Information Center personage said that before the European and American countries will be backward textile processing links pferred to China, now China's textile industry fundamentals have changed, engage in low-end manufacturing is difficult to survive.

And the textile industry chain of Southeast Asian countries is constantly improving and enjoying many preferential policies. Chinese textile enterprises can give them the lower end processing and manufacture, and turn themselves to the high end of the industrial chain.

Zheng Yonggang, chairman of Shanshan Group, told reporters: "in the first 20 years of reform and opening up, the main dividend is earned. The labor force is the main body of competition, so our country has become the world's factory. Now, we are not only the world's factory, but also the largest consumer market in the world.

In the context of the gradual decline of demographic dividend, how to realize the new development mode of textile enterprises is a topic of common concern for the industry.

Hong Tianzhu said that economic recession is the process of survival of the fittest, while brewing progress and innovation.

Under the background of global economic slowdown, how to make use of this economic cycle and use two or three years to work hard to accomplish internal innovation and upgrading is a challenge for Chinese textile and garment enterprises.