Rural-urban Shifts Put China on Development Alert

Data Analysis 09:55:14AM Feb 01, 2012 Source:SMM

GUANGZHOU - Since settling down in this southern metropolis bordering Hong Kong over 20 years ago, Zhang Xiyang, a former farmer from Southwest China's Sichuan province, has grown accustomed to celebrating the Spring Festival like local Cantonese do.

Instead of watching China Central Television's live telecast of the evening gala, the 50-year-old man and his family did some shopping at a flower market on the eve of the Year of the Dragon.

Though rarely eating dumplings in his home village, Zhang entertained friends visiting over the week-long holiday with jau gok, or fried dumplings, a festival snack favored by Cantonese and shaped like a purse, symbolizing a rich, sweet life.

Reluctant to make the 2,000-km trip back home with heavy luggage, Zhang prefers inviting his relatives to celebrate the Spring Festival in Guangzhou, the provincial capital of Guangdong.

"It's too much hassle to return home. Relatives can come to our place to gain different experiences, and we can stay home for a nice, refreshing holiday," Zhang said.

With a steady income and a stable place of residence in the city, Zhang exemplifies the hundreds of millions of Chinese farmers who have joined the country's ever-expanding ranks of urbanites since China kick-started economic reforms at the end of 1970s.

From 2001 to 2010, Guangzhou's population has grown 27.74 percent, or by 2.76 million people, to 12.7 million. Over this period, the migrant population has expanded faster than that of registered residents, and the proportion of migrants to Guangzhou's resident population has jumped from 33.29 percent to 37.48 percent, according to the Sixth National Population Census completed in November 2010.

"The constant influx of rural migrant workers into cities -- a result of ongoing urbanization and industrialization -- will bring pivotal changes to the country's demographic landscape and force China to face the reality of diminishing demographic benefits," said Zheng Zizhen, former dean of the Sociology and Population Institute of the Guangdong Academy of Social Sciences.

Warning signs are already dotting the horizon, as China's urban population outnumbered rural residents for the first time as of the end of 2011. The country currently has 690.79 million urban residents, accounting for 51.27 percent of the country's total population of 1.35 billion, according to the National Bureau of Statistics. The rural population, by contrast, fell by 14.56 million to 656.56 million from 2010 to 2011.

Meanwhile, the working-age population, people aged 15 to 64, stood at about 1 billion, or 74.4 percent of the nation's total. The amount was down 0.1 percentage point from that of the previous year, marking the first decline since 2002.

"China is heading for a tipping point in its demographic advantages, as the family-planning policy coupled with the weakening inflow of rural migrants will eventually take away its developmental advantage of having a sufficient supply of working-age people and end the growth model of using cheap labor to foster economic expansion," said Zheng.

"Made in China" gets expensive

William Fung, managing director of Li & Fung Ltd, a Hong Kong-based manufacturing outsourcing enterprise that supplies garments, fashion accessories and other consumer goods, expected the salaries of Chinese people to grow by 80 percent overall in the next five years as a result of the shrinking working-age population.

"That will, of course, elevate the prices of products made in China," he said.

In recent years, China's labor-intensive manufacturing industries, especially clothing, footwear and toys, have been battling hard against the labor shortage.

Regarding this phenomenon as "not coincidental," Wu Yingxi, an official with the Commerce Bureau of Shandong province, another heavily populated province in eastern China, sees even harder times ahead for these traditional engines of the Chinese economy.

Citing a survey the bureau completed that targeted rural migrant workers born in the 1990s, Wu said rising labor costs were inadequate remedies for helping China's labor-intensive manufacturers hold their position.

"The new generation of rural migrant workers would rather live a hard life in cities than stay at home comfortably. But they would also rather earn less in the service industry than work overtime for higher pay in factories," Wu said.

To attract industrial workers, Wu said manufacturing companies must change the piecework payment structure, provide employees innovation-oriented training to improve corporate productivity, seize time to move up in the value-added chain and have migrant workers benefit more from corporate profits.

"The government, on the other hand, should invest heavily in education to improve the quality of the population and coordinate the development of metropolises and small cities," said Zheng Zizhen, formerly of the Guangdong Academy of Social Sciences.

Urban social management

No cities can absorb newcomers without limits. A city the size of Guangzhou faces an enormous challenge in minding the gap between local residents and incoming rural migrants.

"The transformation from an agricultural society to an industrialized one will weaken the bonds of clans, kinship or acquaintances that remain prevalent in rural China. When rural migrants move to cities, they are basically thrown into a society of strangers. A city's friendliness and openness to outsiders is therefore crucial to maintaining social stability and harmony," Zheng said.

Although he has lived here for over two decades, Zhang Xiyang, originally from Sichuan, complained that his children don't have access to cheaper, but better public education options that local children can enjoy. His greatest hope for the Year of the Dragon is that he will acquire an urban household registration in Guangzhou.

Hu Xiaoyan, the first migrant worker representative to attend the National People's Congress, or China's top legislature, said a majority of migrant workers still feel they can not enjoy equal treatment in cities, especially in terms of medical and education services.

Blueprint for rural areas

Dang Guoying, a rural development researcher with the Chinese Academy of Social Sciences, warned of a labor force drain in rural areas. "When people swarm into cities, questions on rural governance and the future of agriculture also surface."

"Statistically, we can say China has crossed the threshold of an urbanized society. But agriculture and farmers remain the bedrock of the world's most populous country," said Zheng Zizhen.

In a signed article titled "China's Agriculture and the Development Road of Rural Areas" that appeared in the Qiushi Journal under the Central Committee of the Communist Party of China on January 16, Premier Wen Jiabao said that the modernization of agriculture should never be ignored during the process of industrialization and urbanization.

"Rapid urbanization will create favorable conditions for China to tackle the challenges involving rural areas, farmers and agriculture. But it will not guarantee fast changes for the better in rural areas. Maybe it will widen the rural-urban gap," the article said.

"This is why we repeatedly stress the necessity of achieving coordinated development between rural areas and cities... Urbanization can not replace the building up of rural areas, and the functional disparity of cities and rural areas can not and should not be removed," it said.

As the Spring Festival has come to an end, farmer Guo Xiaoming who lives scores of kilometers away from Luoyang, the capital of central Henan province, no longer wants to return to Guangzhou.

He has learned he can earn a monthly salary of 2,000 yuan ($317) by working in a factory nearby his home village.

"As more factories are built on the outskirts of cities, I can work nearby my home village for decent pay and wait to be urbanized," Guo said.

 

 

Rural-urban Shifts Put China on Development Alert

Data Analysis 09:55:14AM Feb 01, 2012 Source:SMM

GUANGZHOU - Since settling down in this southern metropolis bordering Hong Kong over 20 years ago, Zhang Xiyang, a former farmer from Southwest China's Sichuan province, has grown accustomed to celebrating the Spring Festival like local Cantonese do.

Instead of watching China Central Television's live telecast of the evening gala, the 50-year-old man and his family did some shopping at a flower market on the eve of the Year of the Dragon.

Though rarely eating dumplings in his home village, Zhang entertained friends visiting over the week-long holiday with jau gok, or fried dumplings, a festival snack favored by Cantonese and shaped like a purse, symbolizing a rich, sweet life.

Reluctant to make the 2,000-km trip back home with heavy luggage, Zhang prefers inviting his relatives to celebrate the Spring Festival in Guangzhou, the provincial capital of Guangdong.

"It's too much hassle to return home. Relatives can come to our place to gain different experiences, and we can stay home for a nice, refreshing holiday," Zhang said.

With a steady income and a stable place of residence in the city, Zhang exemplifies the hundreds of millions of Chinese farmers who have joined the country's ever-expanding ranks of urbanites since China kick-started economic reforms at the end of 1970s.

From 2001 to 2010, Guangzhou's population has grown 27.74 percent, or by 2.76 million people, to 12.7 million. Over this period, the migrant population has expanded faster than that of registered residents, and the proportion of migrants to Guangzhou's resident population has jumped from 33.29 percent to 37.48 percent, according to the Sixth National Population Census completed in November 2010.

"The constant influx of rural migrant workers into cities -- a result of ongoing urbanization and industrialization -- will bring pivotal changes to the country's demographic landscape and force China to face the reality of diminishing demographic benefits," said Zheng Zizhen, former dean of the Sociology and Population Institute of the Guangdong Academy of Social Sciences.

Warning signs are already dotting the horizon, as China's urban population outnumbered rural residents for the first time as of the end of 2011. The country currently has 690.79 million urban residents, accounting for 51.27 percent of the country's total population of 1.35 billion, according to the National Bureau of Statistics. The rural population, by contrast, fell by 14.56 million to 656.56 million from 2010 to 2011.

Meanwhile, the working-age population, people aged 15 to 64, stood at about 1 billion, or 74.4 percent of the nation's total. The amount was down 0.1 percentage point from that of the previous year, marking the first decline since 2002.

"China is heading for a tipping point in its demographic advantages, as the family-planning policy coupled with the weakening inflow of rural migrants will eventually take away its developmental advantage of having a sufficient supply of working-age people and end the growth model of using cheap labor to foster economic expansion," said Zheng.

"Made in China" gets expensive

William Fung, managing director of Li & Fung Ltd, a Hong Kong-based manufacturing outsourcing enterprise that supplies garments, fashion accessories and other consumer goods, expected the salaries of Chinese people to grow by 80 percent overall in the next five years as a result of the shrinking working-age population.

"That will, of course, elevate the prices of products made in China," he said.

In recent years, China's labor-intensive manufacturing industries, especially clothing, footwear and toys, have been battling hard against the labor shortage.

Regarding this phenomenon as "not coincidental," Wu Yingxi, an official with the Commerce Bureau of Shandong province, another heavily populated province in eastern China, sees even harder times ahead for these traditional engines of the Chinese economy.

Citing a survey the bureau completed that targeted rural migrant workers born in the 1990s, Wu said rising labor costs were inadequate remedies for helping China's labor-intensive manufacturers hold their position.

"The new generation of rural migrant workers would rather live a hard life in cities than stay at home comfortably. But they would also rather earn less in the service industry than work overtime for higher pay in factories," Wu said.

To attract industrial workers, Wu said manufacturing companies must change the piecework payment structure, provide employees innovation-oriented training to improve corporate productivity, seize time to move up in the value-added chain and have migrant workers benefit more from corporate profits.

"The government, on the other hand, should invest heavily in education to improve the quality of the population and coordinate the development of metropolises and small cities," said Zheng Zizhen, formerly of the Guangdong Academy of Social Sciences.

Urban social management

No cities can absorb newcomers without limits. A city the size of Guangzhou faces an enormous challenge in minding the gap between local residents and incoming rural migrants.

"The transformation from an agricultural society to an industrialized one will weaken the bonds of clans, kinship or acquaintances that remain prevalent in rural China. When rural migrants move to cities, they are basically thrown into a society of strangers. A city's friendliness and openness to outsiders is therefore crucial to maintaining social stability and harmony," Zheng said.

Although he has lived here for over two decades, Zhang Xiyang, originally from Sichuan, complained that his children don't have access to cheaper, but better public education options that local children can enjoy. His greatest hope for the Year of the Dragon is that he will acquire an urban household registration in Guangzhou.

Hu Xiaoyan, the first migrant worker representative to attend the National People's Congress, or China's top legislature, said a majority of migrant workers still feel they can not enjoy equal treatment in cities, especially in terms of medical and education services.

Blueprint for rural areas

Dang Guoying, a rural development researcher with the Chinese Academy of Social Sciences, warned of a labor force drain in rural areas. "When people swarm into cities, questions on rural governance and the future of agriculture also surface."

"Statistically, we can say China has crossed the threshold of an urbanized society. But agriculture and farmers remain the bedrock of the world's most populous country," said Zheng Zizhen.

In a signed article titled "China's Agriculture and the Development Road of Rural Areas" that appeared in the Qiushi Journal under the Central Committee of the Communist Party of China on January 16, Premier Wen Jiabao said that the modernization of agriculture should never be ignored during the process of industrialization and urbanization.

"Rapid urbanization will create favorable conditions for China to tackle the challenges involving rural areas, farmers and agriculture. But it will not guarantee fast changes for the better in rural areas. Maybe it will widen the rural-urban gap," the article said.

"This is why we repeatedly stress the necessity of achieving coordinated development between rural areas and cities... Urbanization can not replace the building up of rural areas, and the functional disparity of cities and rural areas can not and should not be removed," it said.

As the Spring Festival has come to an end, farmer Guo Xiaoming who lives scores of kilometers away from Luoyang, the capital of central Henan province, no longer wants to return to Guangzhou.

He has learned he can earn a monthly salary of 2,000 yuan ($317) by working in a factory nearby his home village.

"As more factories are built on the outskirts of cities, I can work nearby my home village for decent pay and wait to be urbanized," Guo said.