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    Posted April 20, 2014 by
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    Life in China

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    The Problematic Future of Employing Robots in Guangzhou


    In mid-April 2014, the Guangzhou city government issued a document to foster the robotic industry. The goal of this new measure is to replace 80% of human labor in the manufacturing industry with robots within the next six years (by 2020). Some industries that will be affected include food processing, mechanical and automobile manufacturing, as well as the manufacturing of pharmaceutical, electronic and dangerous products.

    Furthermore, the government is even providing a stimulus package to increase the use of robots, and companies that purchase or rent robots will receive subsidies of up to RMB 30,000 (USD$4800). Companies that set up a complete set of automated equipment in the region will receive a subsidy of up to RMB 500,000.

    The situation that is believed to be one of the main causes that has triggered the implementation of such new measures was a massive strike by migrant workers that lasted for several days at Yue Yuen Industrial (Holdings), a footwear maker for global sportswear brands including Nike and Adidas. This shoe factory is located at Dongguan, around 50km south of Guangzhou. Those migrant workers demanded a 30% pay increase and better benefits, such as social insurance and housing fund contributions. Before this strike the migrant workers of a watch factory had once been out on strike at Guangzhou.

    Located in the Pearl River delta, Guangzhou was created as a huge industrial experiment by China’s leaders. Eight linked motorways that are intertwined with each other link Guangzhou to other nearby cities. Although living costs are increasing, the incredible urban fiestas and fantastic large steel structures towering over the old Chinese roofs here still have magical magnetic appeal to migrant workers from neighboring municipalities. Thus, around 75% of Guangzhou’s population is composed of migrant workers.

    As for the newly employed robotic industry measures in this city, it is obvious that migrant workers are among the ones that will suffer the most from its direct impact. Sophisticated manufacturing processes might reduce the cost of human resources. Unfortunately, on the other hand, those robots will also create a huge structural unemployment problem. As most of us might have already been aware of, a structural unemployment problem is one of the most difficult economic problems that exist due to the cause being rooted in the overall structure and labour market of the economy itself.

    Putting broader context on this situation, adding more than 30 million unemployed migrant workers to the national economic portfolio within less than 6 years would also provide contrasting effects to all of the effort now being undertaken to increase national GDP.

    It might be wise to balance such measures in the robotics industry with another measure that involves vocational training institutions in order to provide a skills upgrade for migrant workers. By employing such a balanced measure, by the time the robotic era comes, the human beings will have the necessary skills needed to survive.

    Picture 1
    Sophisticated manufacturing process
    es at a Chinese company. Credit: wantchinatimes.com

    Picture 2
    A Hukou, a document that classifies Chinese workers according to their home cities. This is also the document that gives them the status# “migrant workers”. Credit: clb.org.hk


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