China is already facing the challenge of a shrinking labor force. Its working age population—16 to 59—declined by more than 2 million people, to about 920 million last year, compared with 2012. And while the total number of migrant workers is still increasing slowly, up 2.4 percent, to 269 million, last year, many lack needed skills. That’s despite the fact that wages keep rising, up about 14 percent, to around 2,600 yuan ($427) a month last year.
“It is difficult to hire general workers, which reflects the limited supply of migrant workers. Despite China upgrading and restructuring its industrial base, there are difficulties in recruiting enough skilled technicians to work in these fields,” said Yang Zhiming, deputy minister of Human Resources and Social Security, at a press conference Thursday in Beijing, reported the Global Times.
China is aiming to shift its economy to higher-value-added industries and lessen its reliance on low-end, low-skill manufacturing of shoes, clothes, and toys, a process officials have dubbed tenglong huanniao, or “clearing the cage and changing the bird.” To meet the skills gap, the government will offer more training programs and educate at least 10 million migrants a year. Beijing intends to provide training by 2020 for the entire “new generation” of migrant workers, or those born after the 1980s, which now number about 100 million, according to Yang.
Beijing will also provide small loans ranging from 50,000 yuan to 100,000 yuan to support migrant workers who want to start their own businesses in their hometowns. Already more than 2 million microloans have been disbursed. “A sufficient number of skilled workers is vital for the economy to be upgraded from ‘made in China’ to ‘created in China,’” reported the official China Daily on Friday.