The Chinese Diaspora

In what might be the most fascinating labor development to come out of China this year, major ODMs are relocating workers west due to labor shortages.

One major reason companies in Shenzhen packed up their factories and moved inland (with the government’s blessing) was to chase a larger supply of lower-cost workers. Shenzhen had become too expensive, and migrants from the western farms were no longer so eager to move to the Southeast coast to take jobs. The diaspora was supposed to resolve both

But today the news out of China is much different. Quanta Computer and Compal Electronics reportedly have moved employees from east to west to support factories in Chongqing City, a municipality with a population of more than 28 million (!), due to short labor supplies.

Even in a country of 1.3 billion people, cheap, effective workers apparently are hard to come by.

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About Mike

Mike Buetow is editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He is also vice president and editorial director of UP Media Group, for which he oversees all editorial and production aspects. He has more than 20 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

3 thoughts on “The Chinese Diaspora

  1. Remember when New England and MidAtlantic based firms migrated to Hunstville, Raliegh-Durham, Tennesee and Puerto Rico, while companies like GE migrated their television manufacturing to Taiwan and other points East…or West, depending on which direction you’re facing.

    Five years ago a senior supply chain executive from IBM told me that they already had their eye on Africa as the next landing spot for their low cost manufacturing solution, as IBM anticipated China’s competitive labor advantage to diminish in direct relation to the increase in China’s average standard of living.

    It happens to the best of us.

  2. Finding cheap effective workers anywhere in China, has never been a problem.

    The problem has traditionally been civil unease in the inland provinces over the concentration of wealth and difference in standard of living in the coastal regions.

    What you are seeing is a move by Beijing leadership to spread the wealth and level out the standard of living across a larger portion of the population. China’s economic growth and security requires stability. This was to be expected.

  3. “Cheap” and “Effective”.. are relative terms.

    And complete comparisons (on costs .. $ and political) are not always understood.
    Or have same values in US vs China (or elsewhere).
    If you run a business (or a country) you very rarely have all the facts for making a informed decision. Generally, it is a matter of gathering facts until you have no time remaining.

    Interesting to note regardless…
    And the scale of these actions in China.. are hard (for us in the west) to relate to!

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