In 2010, the Labour Costs of Textile Industry are Increased Greatly in China

In 2010, the textile sales make a great progress compared with two years before at China-Shengze market, the domestic and international demand for textiles increased, leading to the fabric prosperity in the market of China-Shengze. This year, the situation of the fabric shortage occurs frequently at China-Shengze market, the effects of weaving factory reflects well in general. However, the fabric market transfers to good at the same time, some problems also exist, for example, the labour costs of textile industry are increased greatly, making their overall costs improve, and the profits of product reduce. At first, according to the charts of the average wage of workers, we analyze about the labour costs of the textile enterprise in 2010.

From the average wage of trend to analyze, in 2010, the wage of workers shows the trend of increasing rapidly at China-Shengze textile enterprises, the wage rises from 1,800RMB/month to 2,200-2,300RMB/month during in 2009-2010, and the wage has improved significantly compared with the previous years. Although in February the days of actual production are less than others due to the Spring Festival, and the workers’ annual bonus is affected, at the beginning of March, the wage of workers maintain a relatively steady growth at China-Shengze textile enterprises, in April, the average wages of the enterprise rise 9.7%, it rises 37.3% compared with 2009; in May, the average wages of the enterprise continue to the rising trend two months before, and rise 5.44% compared with the April; until to the July, the average wages of the enterprises also rise in a certain, and it has reached a historical height. Although the average wages of workers fell shortly in August, and this can not affect the way of rising labor costs, in September, the average wages increase 0.01%; in October, the average wages rise again 4.5%, up to December, the labor costs of textile enterprises rise beyond 10% at China-Shengze, the labor costs of some factories increase by 20%. Therefore, it has become one of the problems to face, which the labor resources are nervous and the labor costs rise at China-Sheng textile enterprises.

Second, we analyze that the labor costs of textile enterprises the reason of rising sharply labor costs in 2010, the reasons as follow:

Firstly, the labor shortage leads to raise labor costs. The adjustment of the workers’ wages mainly focus on the beginning and the end of the year, in this period, the phenomenon of the labor shortage will appear at China-Shengze, therefore, many enterprises have adopted the way to increase the workers’ wages to retain them, thus ensuring the normal production.

Secondly, the enterprises improve the wages in order to stable development. As the textile industry is the production processing and service-oriented enterprises, and belongs to the labor-intensive industries, the drain of labor is faster, resulting in the employment growth in demand for the textile manufacturers; however, at present the migrant workers are more at China-Shengze market, their stability is insufficient, the fluidity is bigger, and some workers want to resign only do a few months. Therefore, the majority of the textile enterprises increase their wages and bonuses in order to retain the general operatives and the professional and technical personnel, thus maintains the normal production operation.

Thirdly, the soaring prices are also resulted in the important reasons for increasing the labor costs. Currently, the prices of whole society are high, people’s living costs also increase, and the requirement of the wages are increasingly high. I believe that the enterprises raise the workers’ wages are sooner or later things, along with the consumer prices rising.

However, raising the labor costs will influence on the enterprises are not the same. For large-scale enterprises, the profits of enterprises are mainly embodied in product innovation and expand the sales channels, the labor prices account for the ratio of smaller costs, and the labor rising is less impact on the enterprises. They can transfer the partial losses from raising the labor costs by differentiating their product sales; while for those products that the quality is poor and the profit is low, the rising of labor costs is a very serious strike. So facing with the rising of labor costs, the enterprises should continue to improve the product structure, increase innovation and find the new ideas for the enterprise development.