China has been experiencing sweeping changes in the labour market, which will shape the events industry for years to come. These are changes we all need to be aware of and prepare for. In particular, central government in China has implemented policies in the last year to repatriate migrant workers from coastal industrial areas back to their villages within mainland China promoting economic expansion within the western China provinces.
The result is a huge shortage of workers in the traditional industrial coastal areas leading to one in six factories being closed. As many as 10,000 factories have closed in the textile industry alone..
This is a deliberate policy to promote the production of higher value items, in particular electronics. And it is being achieved by the implementation of minimum wages, which have doubled in the last two years. Workers are very much aware of this shift in power and are now demanding the very best working conditions. While the high tech industries are shaping up to meet the demands of workers, the older traditional industries are resisting the change. In my opinion, such trades will fail under the new China regime.
What does all this mean for our industry? The answer is the potential demise of factories supplying all those extras we need for our events – promotional products, badges, lanyards etc. Ultimately, there are very few factories in these areas that will adapt to the change – and so prices will rise as the products become scarcer and more fair-trade orientated. Those in the event industry who are smart enough to consider CSR will adapt their trading practices and make accommodations for such price fluctuations, accepting that the extra cost provides a better quality of life for those making the goods.
Personally, I embrace the change and have already implemented fair trade policies in our factories. We have implemented new wage policies, bonuses, improved facilities, staff away days and more. Now, as a result of the rapid changes we have leased new premises which have enabled us to completely renovate to ensure we are on a par with leading electronics factories and offering working conditions which you would expect in the west.
Of course, some will continue to work with the cheap companies who treat staff poorly. But as staff depart, lead times and delivery quality decrease. In fact, I am already aware of one company that has extended delivery to 24 weeks – not much use in our fast changing events industry!