GROWING up in a Chinese village, Julian Zhu only saw his father a few times a year when he returned for holidays from his exhausting job in a textile mill in southern Guangdong province.
For his father's generation, factory work was a lifeline out of poverty. For Zhu, and millions of other younger Chinese, the low pay, long hours of drudgery and the risk of injuries are no longer sacrifices worth making.
"After a while, that work makes your mind numb," said the 32-year-old, who quit the production lines some years ago and now makes a living selling milk formula and doing scooter deliveries for a supermarket in Shenzhen, China's southern tech hub.
The rejection of grinding factory work by Zhu and other Chinese in their 20s and 30s is contributing to a deepening labour shortage that is frustrating manufacturers in China, which produces a third of the goods consumed globally.
Factory bosses say they would produce more, and faster, with younger blood replacing their ageing workforce. But offering higher wages and better working conditions younger Chinese want would risk eroding their competitive advantage. And, smaller manufacturers say large investments in automation are either unaffordable or imprudent when rising inflation and borrowing costs are curbing demand in China's key export markets.
More than 80 per cent of Chinese manufacturers faced labour shortages ranging from hundreds to thousands of workers this year, equivalent to 10 to 30 per cent of their workforce, a survey by CIIC Consulting showed.
China's Education Ministry forecasts a shortage of nearly 30 million manufacturing workers by 2025, larger than Australia's population. On paper, labour is in no short supply: roughly 18 per cent of Chinese aged 16-24 are unemployed.
This year alone, a cohort of 10.8 million graduates entered a job market that, besides manufacturing, is very subdued. China's economy, pummelled by Covid-19 restrictions, a property market downturn and regulatory crackdowns on tech and other private industries, faces its slowest growth in decades.
Klaus Zenkel, who chairs the European Chamber of Commerce in South China, moved to the region about two decades ago, runs a factory in Shenzhen with around 50 workers who make magnetically shielded rooms used by hospitals for MRI screenings and other procedures.
Zenkel said, China's breakneck economic growth in recent years had lifted the aspirations of younger generations, who now see his line of work as increasingly unattractive.
"If you are young it's much easier to do this job, climbing up the ladder, doing some machinery work, handle tools, and so on, but most of our installers are aged 50 to 60," he said.
"Sooner or later we need to get more young people, but it's very difficult. Applicants will have a quick look and say 'no, thank you, that's not for me'."
Manufacturers say they have three main options to tackle the labour-market mismatch: sacrifice profit margins to increase wages; invest more in automation; or hop on the decoupling wave set off by the heightened rivalry between China and the West and move to cheaper pastures, such as Vietnam or India.
But, all those choices are difficult to implement. Liu, who runs a factory in the electric battery supply chain, has invested in advanced equipment with better digital measurements. He said, his older workers struggle to keep up with the faster gear.
Liu said, he tried luring younger workers with 5 per cent higher wages but was given a cold shoulder. Chinese policymakers have emphasised automation and industrial upgrading as a solution to an ageing workforce.
The country of 1.4 billion people, on the brink of a demographic downturn, accounted for half of the robot installations in 2021, up 44 per cent year-on-year, the International Federation of Robotics said. But, automation has its limits.
Dotty, a general manager at a stainless-steel treatment factory in Foshan, has automated packaging and work surface cleaning, but says a similar fix for other functions would be too costly.
"Our products are really heavy and we need people to transfer them from one processing procedure to the next. It's labour intensive in hot temperatures and we have difficulty hiring for these procedures," she said.
The writer is from the Reuters news agency