In November 2023, Reuters reported that Bangladesh raised the minimum wage for workers by 56.25% to 824.62 yuan. However, despite the huge increase, it still did not meet the wishes of the workers, who unanimously demanded that the minimum wage be adjusted to the range of 1,500 yuan, to which the Bangladesh Exporters Association responded:
Excessive wages can squeeze factory profits, which in turn will lead to factory relocation, and making reasonable adjustments in accordance with the principles of sustainable development is the right course.
In recent years, Bangladesh has undertaken a lot of garment manufacturing, and many of these manufacturing industries have been transferred from China. On the one hand, Bangladesh has benefited from this, with workers' wages rising by a full half.
On the other hand, China's youth unemployment rate of 16~24 years old has broken through to 20.4% for the first time this year.
Employment impact in low-end manufacturing
First of all, industrial transfer is an inevitable trend of development, and there have been four large-scale industrial transfers in the world, namely the transfer of Britain to the United States in the 20th century, the transfer of the United States to Japan and Germany in the 50s, the transfer of Japan and Germany to Asia and Latin America in the 60s, and the transfer of new industrial countries in Asia to China in the early 80s, making China a new generation of world factories in just a few decades.
After decades of rapid development, China is bound to experience the transfer of low-end industries. Since 2014, the amount of foreign investment in seven categories of mainland textiles, clothing, bags, shoes, toys, furniture and plastic products has exceeded the amount of foreign investment. In 2013, the global share of these seven types of products was 38.3%, and as of 2022, it has dropped to 31.7%.
In 2015, the country put forward the strategic layout of "Made in China 2025", which is to build China into a manufacturing power leading the development of the world's manufacturing industry in the next 30 years through the transformation and upgrading of the manufacturing industry.
Under the influence of policies, China's low-end manufacturing industry has been moving to Southeast Asia and other countries in the past two years. Many people have criticized this, accusing the manufacturing industry of being the foundation of China's development and the guarantee of jobs for millions of people in China, and many poor people are relying on low-end manufacturing to support their families.
In April 2023, the National Bureau of Statistics announced that the surveyed urban unemployment rate of the 16-24-year-old labor force hit a record high of 20.4% since the statistics.
The answer is that the two have little to do with each other, at least not to the point of influencing each other. First of all, China's youth unemployment rate has been rising continuously since 2018: 10.81% in 2018, 11.88% in 2019, 14.19% in 2020, 14.25% in 2021, 17.55 in 2022, and 20.4% in April last year.
If you look closely at the uptrend, you will see that 2020 and 2022 are two nodes that have risen sharply. China's low-end manufacturing industry is constantly shifting, and the sharp rise in unemployment obviously does not meet our guess.
In Bangladesh, the overall unemployment rate in Bangladesh will be 3.53% in 2022, while the unemployment rate of young people aged 15-29 will be as high as 8%. There should be another reason for China's rising youth unemployment.
So after the transfer of China's low-end industry, is the money made by other countries? The answer is not, here we take Bangladesh and Vietnam as examples: the garment industry, as the pillar industry of Bangladesh, in 2012 ~ 2023, its garment exports increased from 21.52 billion US dollars to 45.7 billion US dollars, accounting for nearly 80% of the total exports. The mainland's labor-intensive industries have been transferred since 2014, and a considerable part of the scale has been undertaken by Bangladesh.
In 2022, Bangladesh's total exports to China will be 981 million US dollars, and the total export value will be 26.808 billion US dollars, with a deficit of 25.828 billion US dollars!
Coincidentally, Vietnam's deficit with the mainland in 2022 is as high as $59 billion. This is the sadness of the country taking low-end industries as the pillar, and the hard-earned meager manual fees have to go to advanced countries to purchase high-end products. Thanks to the thriving garment industries of the two countries, the mainland's embroidery machine exports in 2022 have even increased by 40.83%.
The total deficit between Vietnam and Bangladesh is as high as 84.827 billion US dollars, and how many jobs can these dollars be used to invest in tourism, catering, and cultural industries in mainland society, and how much economic consumption can be stimulated?
On the other hand, this is also the reason why the United States has imposed a technological blockade on us, and they are doing everything possible to prevent our industrial upgrading, so the country's manufacturing upgrading is extremely far-sighted.
Reasons for the high youth unemployment rate
With a youth unemployment rate of 20.4 per cent, one in five people is unemployed. Although the international youth unemployment rate has long been about three times that of adults, the mainland youth unemployment rate is 20.4 percent to 4.2 percent, a five-fold difference.
The first reason is the increased difficulty of employment brought about by individual needs. In today's Chinese society, graduates of first-class famous universities are not worried about work, and the real "worries" are ordinary colleges and universities and graduates of secondary and tertiary colleges, whose comprehensive quality is slightly lacking in comparison, and lacks obvious outstanding skills.
Recruitment agencies show that graduates are affected by the epidemic and are more inclined to well-known enterprises and state-owned enterprises, which undoubtedly increases the difficulty of job matching.
In the face of increasing employment pressure, anxious graduates have not changed their wishes and needs. Zhaopin.com conducted a survey of 2021 fresh graduates, and the results showed that as of mid-April of that year, only 56.9% of the 8,000 respondents chose to look for jobs, and the rest chose to work slowly.
The second reason is that the proportion of young people with low educational qualifications is relatively high. In the April 2023 Youth Unemployment Rate Survey, 28.9% had a junior high school education or less, 22.6% had a high school secondary school, and 14.7% had a college degree or above. The lack of professional skills and competitiveness of young people with low educational qualifications is an indisputable objective fact, combined with the impact of the epidemic, small social enterprises have been hit hard and jobs have been greatly reduced, which will inevitably form the majority of young people in the job market.
There are many other reasons, such as the increase in the number of college graduates due to the expansion of university enrollment, and the stricter supervision and control of the Internet, finance, education and other industries, so the rise in China's youth unemployment rate is a multi-factor phenomenon. As unemployed youth, how can we solve our own employment problems?
Young people who have the ability to learn and Xi should attach importance to the opportunity to take the postgraduate examination. Although the number of graduate students is rising and the competition is becoming more and more fierce, in the workplace, a master's degree is still the first choice for choosing a career.
Young people who do not have the possibility of academic further education should jump out of the thinking trap of fighting for academic qualifications and choose to develop their own skills in professional technology. The Ministry of Human Resources and Social Security previously announced the 100 most scarce occupations in the third quarter of 2023, of which 39 are from manufacturing and 19 are professional and technical.
This set of data shows that some professional fields in China are still in a labor dilemma, and young people can freely choose their majors to study and Xi.
Choose a bonus major. Each era has a sunset industry and a sunrise industry, and each era has its own characteristics. For example, in the seventies and eighties, the economy developed rapidly, the financial profession was highly respected, and in the nineties, foreign trade was reformed, and foreign trade foreign languages became fragrant. In the 21st century, the Internet and artificial intelligence are the tide of the current era. Look at the direction, these are the first choice for young people's majors.
Overall, the upgrading of the country's low-end manufacturing industry is needed for development, and we should be happy, and the impact of it on jobs is minimal. In the face of fierce competition and employment involution, each of us must pay more attention to improving ourselves and finding the right direction for the future, so as to stand firm in our position on the giant wheel of the times.