China is short of skills, not workers

Subject

Labour shortages in China.

Significance

Companies in coastal China have been reporting recurring labour shortages for the past decade. However, the ratio of job vacancies to job seekers is even greater in low-tier cities and in western and central China.

Impacts

• Training the young with market-relevant skills is crucial to increasing labour productivity as China moves up the value-added chain.
• A focus on vocational training will help address the education mismatch, but the education it offers is of low quality.
• Poor working conditions in service sector jobs will create a growing labour unrest problem in these sectors unless addressed.