China firms dangle pay carrot for CNY

Fuyang city in China's Anhui province providing free transport at Fuyang Railway Station Square last Saturday to take returning migrant workers home for Chinese New Year.
Fuyang city in China's Anhui province providing free transport at Fuyang Railway Station Square last Saturday to take returning migrant workers home for Chinese New Year.PHOTO: XINHUA

Service sector companies offer higher pay to get staff to work amid holiday shortage

BEIJING • Desperate companies in China's booming service industry are offering workers up to three times their normal salary to entice them to work over the Chinese New Year period.

For many migrant workers, the upcoming festival is the only time of the year when they return home to visit families and friends. Some set off for home as early as two weeks before the holiday.

"The shortage of migrant workers always happens in coastal and developed cities. The phenomenon largely exists in traditional industries such as hairdressing, but also in many industries that are flourishing because of online shopping, such as delivery companies," population and development professor Peng Xizhe of Shanghai's Fudan University told the Global Times. As many employees will start job hopping after getting their year-end bonus, he added that firms in general will continue to experience staff shortages.

The Chinese government's efforts to develop inland provinces, including offering tax breaks and other incentives to companies to set up operations in poorer regions of the country, have created more opportunities in towns and cities closer to home.

China had more than 277 million rural workers in 2015, 60 per cent of whom work outside their home towns. Around 44.5 per cent worked in the service industry, according to data released by the National Bureau of Statistics last April.

A 30-year-old courier surnamed Wang told the Global Times that whoever works during Spring Festival holidays will receive three times their normal salary, but many, including himself, still plan to go home. "I will go home to spend my new year. I miss home," said the Shanxi native.

The delivery company which he works for is among a few businesses which are open for business throughout the Chinese New Year period. The firm has told customers to expect delays as packages started to pile up in the warehouse, he noted.

Latest labour statistics showed that China's official urban unemployment rate declined slightly last year to finish at 4.02 per cent. The country also created 13.14 million new jobs for urban residents last year, exceeding the government's target of 10 million, reported China Daily.

But officials and analysts warn that the country is facing looming challenges in the job market: a shrinking working-age population, structural changes to the economy and a shortage of skilled workers.

Mr Lu Aihong, an official with the Ministry of Human Resources and Social Security, told a news conference on Monday that he is expecting more jobs to be created as China reforms its economy through urbanisation and the promotion of the One Belt, One Road initiative.

A version of this article appeared in the print edition of The Straits Times on January 25, 2017, with the headline 'China firms dangle pay carrot for CNY'. Print Edition | Subscribe