What are the problems in labor shortages and high export costs?

In 2005, the workers and people in China demand more high wages and better economic working conditions. The workers do not want any boring factory work that gives only few dollars per hours and the wages raised almost 50% which affects a big part for China economic. This started happened at Guangdong and Fujian which people wanted to live a better life.

These problems first issued in "The New York Times" in April 2006, in this article. The writer said that the wages are rising because there are more educated people than people and almost every young people went to college. Later "The New York Times" issued another article in August 2007 which they said the rising of wages is accelerating these days. The wages went up to 200 dollars which raise 100% than 2005. This is effective for young people who is suitable to make product faster, but not for people who is more than 40 and could not get a job anymore. This rising wages effect as a good part first time because of increase in productivity, but the costs of imports went up so inflation was made here. This is because the economic system was relying on the low wages. The cost of imports went up 0.4 percent in 2007 and later it went up to 0.9 percent in 2008. This pressured not only for China and also in the United States and some Europe countries. They are trying to stop this chaos so they put a new labor law which is for increasing the rights of the workforce and this is for foreigners who come from Thailand, Vietnam, or Bangladesh. By this law, 20 million jobs in 67,000 factories were lost and the growth in export order began to fall. This shows positive effect for China's government, but this led to global financial crises and Guangdong later collapsed.

This still is going on right now. In early 2010, the shortage developed that workers want more wages so they did not come back after the New Year holiday and made the wages go up to one dollar per hour for factory workers in Guangzhou. This effected and strikes in 2010 at Japanese auto plants. Lastly according to Fan Gang, who is the professor of economics at Beijing University and director of China's National Economic Research institute, said that due of the high wages there will be more room for unremunerative agricultural than industry work which will effect positive part for China's economic.

Source: http://en.wikipedia.org/wiki/Economy_of_the_People%27s_Republic_of_China

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