A New Step in Innovation

Filling the gaps in an ever-changing labour market

China has been ambitious in upgrading and automating its manufacturing, with the country now in need of highly-skilled technicians that will be able to use these new, innovative technologies, such as robots, in factories. However, most workers currently do not have the expertise to use and manage these high-end machines. This lack of know-how has become acute in Foshan’s South China manufacturing base, despite it becoming increasingly known for accelerating industrial modernisation. In this article, Kaspar Wu, senior project manager of the Foshan Hi-tech Industry Development Zone, will discuss the current talent shortage and will provide suggestion on how companies can alleviate this problem.

Factories demand high-tech talent

As a major manufacturing city in the Pearl River Delta, Foshan has striven to build itself as a National Manufacturing Innovation Centre and, at the same time, vigorously promote the use of industrial robots in manufacturing, with an aim to gradually transform traditionally labour-intensive industries to make them more efficient. According to the Implementation Scheme for Supporting Factories to Replace Labour with Industrial Robots, issued by the Foshan Government, about 3,000 enterprises in Foshan have completed industrial robot upgrades in 2017, which means more than 50 per cent of the large factories in the area have undergone automotive renovations.[1]

In addition, Foshan is facing a talent gap that is quite large. According to a survey conducted by the Foshan Human Resources and Social Security Bureau, the total number of positions that are open due to Foshan’s recent labour shortage is approximately 63,000 in 2018, with those possessing the appropriate skills in robotics and similar technologies in urgent demand.[2] Yuan Zhigang, director of the Research Centre of Employment and Social Security at Fudan University, indicated that at the current stage, although robots replace labour in the workshop, it is still necessary to have technicians to operate and manage them. Wang Chenyong, head of the Robotics Training Institute in South China, said in an interview, “In the mere fields of robot operation and testing, at least 5,000 technicians are needed in Foshan.”[3]

Statistics from the Human Resources and Social Security Department of Guangdong Province shows that, the demand for skilled workers accounted for 18.2 per cent of the total labour demand at the end of 2016, increasing 2.7 per cent year-on-year. Additionally, according to statistics from the Foshan Shunde Employment Service Centre, the high-tech sector accounts for 40 per cent of the total labour shortage, increasing six per cent year-on-year. This labour shortage has spread from traditional manufacturing-based industries, such as home appliances and low-grade machinery, to robotics and other advanced industries. The 21st Century Business Herald Reporter found that it is extremely difficult for many manufacturing enterprises to recruit the most qualified people for these new positions.[4]

Skilled labour shortages

There are several reasons for factories facing labour shortages. First, higher education does not always correlate directly with market demand. A possible cause of China’s current unemployment problems is that despite the recent expansion of university enrolment in the early 21st century, the course design and university admissions system have not kept pace. Technology is changing faster than ever before, with on-the-job vocational training becoming more important by the day.

Second, education in China tends to neglect the use of internships and other forms of practical-based experience. In the survey Social Needs and Schooling Quality, 44 per cent of engineering undergraduates think schools provide them an insufficient amount of internship opportunities and practical experience. Among them, 87 per cent think that professional internships are not enough, 21 per cent consider current curriculum to not be practical, and 16 per cent think a graduation project is not scientific or rigorous enough.[5]

Third, technical vocational training is not emphasised. Educational funding for vocational training is only one-third that of undergraduate colleges and major universities, with the income of many graduates from vocational education schools not being very high.

Support from the Foshan Government

In order to keep pace with the country’s industrial upgrading strategy, the Foshan Government has been taking active measures to solve the shortage of skilled labour.

The government has brought in talent from nearby tier-one cities, such as Guangzhou. Foshan is not only looking to accelerate the construction of the Guangzhou Higher Education Mega Centre but is also hoping to encourage engineers from Guangzhou to migrate to Foshan and work at the local factories on the weekends – becoming known as ‘Saturday technicians’. This model was first used in the 1970s and the city is thinking of resuming this policy.

At the same time, the Foshan Municipal Committee and the Foshan Municipal People’s Government issued a Decision on Strengthening the Set-up of Talent Pool and Promoting the Optimisation and Upgrading of the Economic Structure. Some of the things it has introduced to try and address the skilled labour problem include the following: improve the existing income allocation system and talent recruitment methods to attract high-skilled workers, create a ‘green channel’ for high-end talent, establish a hi-tech incubator to bring in skilled workers, use the ‘talent special employment’ system, arrange for public servants and senior managers to be properly trained, and promote the incorporation of new technologies in the industrialisation process based on a market-oriented approach to innovation.[6] Through these efforts, the Foshan Government believes they will help alleviate the high-skilled worker shortage and upgrade its industry.

Foshan Hi-tech Industrial Development Zone is a national-level high-tech industrial development zone, that was approved by the State Council in December 1992. It plays an integral role in the Pearl River Delta National Indigenous Innovation Pilot Zone and has attracted 61 global Fortune 500 enterprises, 44 listed companies and 380 enterprises with an output value of more than Chinese yuan (CNY) 100 million.

[1] http://finance.sina.com.cn/roll/2016-11-12/doc-ifxxsmic6078114.shtml

[2] http://www.21jingji.com/2018/3-22/3NMDEzNzlfMTQyNjg3NQ.html

[3] http://finance.sina.com.cn/roll/2016-11-12/doc-ifxxsmic6078114.shtml

[4] https://www.touzi.com/news/422448.html

[5] http://finance.sina.com.cn/roll/2016-11-12/doc-ifxxsmic6078114.shtml

[6] http://www.fshrss.gov.cn/zwgk/jcxxgk/zcfg/rcfw/201709/t20170911_6295260.html