COVID concerns are adding to China's battle to attract workers, leaving doubts about how it will meet worldwide manufacturing demands.
Labor shortages throughout Chinese factories are the result of the coronavirus, along with a shifting mindset toward white-collar jobs by Chinese youth and an aging workforce,
The Wall Street Journal reported that amplifying the issue is the lingering effect of China's former one-child policy.
"Many factory owners are in a dilemma now," David Li, general secretary of the Dongguan-based Asia Footwear Association, was quoted in the Journal. "They do not know whether they'll be able to make a profit if they accept new orders."
This is coming at a time when the coronavirus has left many Asian businesses unable to fill orders, which is sending more commerce China's way, the Journal said.
Another issue the Journal reported is the decline in the number of migrant workers available for factory jobs. Since the coronavirus, fewer workers have wanted to risk going to the cities for employment, even though China's cases are not considered high.
"We can hardly find any workers because many aren't leaving hometowns anymore," Jeroen Herms, co-founder of BSK Fashion Bags in Guangzhou, said in the Journal's report.
Officials aren't holding out hope that a maturing wave of youth will fill the factories, either. The younger generation is showing far more interest in white-collar professions as opposed to factory jobs.
As recently as 2019, 20% of recent college graduates in China had difficulty finding jobs that fit their area of study.
According to census data, the situation isn't going to get better any time soon. With demand slated to rise over the course of the next few years due to growth in online shopping, China expects to find itself in a tough situation.
China’s working age population, those between 15 and 59 years, fell to 894 million in 2020, which is 63% of the total population. In 2010, the working age population was 939 million or 70% of the population, the Journal said.
One potential way for factories to draw from the white-collar field is to raise wages, but companies are reluctant due to higher raw material costs. Although factories also can charge more for goods, the question is whether customers will accept price increases.
As of now, there's no end in sight for the labor shortage, which could spell trouble for the world economy in the not-too-distant future.