China's Cheap Labour No More

There are still armies of factory workers -- but they want better pay to stay

On my first day at work in Beijing at a state media company in 2007, my new boss took me out to lunch and I remember him saying the supply of migrant workers was "limitless".

He believed (or wanted me to believe) there was an endless supply of cheap labour for factories.

I was very skeptical -- eventually the country would run out of migrant workers because everyone had one-child families save for ethnic minorities.

Ten years later I wish I could go back to him and say, "Remember you told me the supply of factory workers was 'limitless'? You were completely wrong!"

Workers come from the countryside and are hardly "limitless"

Factory owners are having a tough time not only finding but retaining workers these days.

Rising labour costs have led to a high turnover rate among factory workers. Wuhan University did a survey of factories in Guangdong and Hubei and found 26 percent of workers in the Pearl River Delta had changed jobs.

"With high turnover, they have to pay workers more to retain them," said Albert Park, one of the designers of the survey and is a professor at the Hong Kong University of Science and Technology.

The average monthly wages in China rose to 4,126 yuan (US$603.78) per month in 2015, almost comparable to Brazil and much higher than developing economies like India and Vietnam.

In addition, in order to gain subsidies and tax benefits from the government, more than one-third of mainland factory owners try to gain favoritism from the state or the Communist Party. More than half surveyed received government subsidies, which account for 2.6 percent of their sales revenues.

Some factory owners resort to using robots to cut costs

About 23 percent of factory owners do this by serving in local parliaments and political consultative committees, while 39 percent are party members.

Because of rising labour costs, 40 percent of manufacturers in Guangdong and Hubei use robots in production. To Park, this means factory owners aren't sure demand will improve and so they are cautious about making large investments.

How much has changed in a decade! While we're pleased to know migrant workers are earning more money, the cost of living for them has increased too.

What they really need is access to education to further improve their employment opportunities. However, this is the next hurdle that really needs to be tackled so that children of migrant workers will at least see more hope for the next generation in terms of social and economic mobility.

Hong Kong's Smog-Filled Air

The serious smog levels made it difficult to see across Victoria Harbour today

This morning I woke up to... haze.

Looking out towards Victoria Harbour, I could not distinguish between the water and land -- it was all like a fog, but it really was terribly polluted air.

At 2pm, readings at Hong Kong's 13 general stations as well as three roadside stations had reached "very high" or "serious" health risk levels. Six stations reported scores of 10+, the highest possible, indicating a serious health risk.

Children, the elderly and people with heart or respiratory issues were advised to avoid staying outdoors, especially in areas with heavy traffic.

And yet when I was out in the streets I hardly saw anyone of us don a mask.

Air quality readings went through the roof today

Are we the stupid ones? Or is the government stupid to let our air quality deteriorate so badly?

An Environmental Protection Department spokesman said the pollution was brought by high pressure over the western North pacific as well as light winds locally.

"In addition, Hong Kong is also being affected by an airstream with higher background pollutant concentrations from the Pearl River Delta," the spokesman said.

That's code for blaming the mainland for the pollution, but in the last few years most of the factories across the border have closed down. So where is the pollution really coming from?

The spokesman added that the sunshine, together with "higher than normal" levels of nitrogen dioxide and particulates, had enhanced the smog, resulting in high pollution.

Nitrogen dioxide comes from emissions from cars, trucks, buses, machinery and power plants. Surely a good chunk of that was pollution was made locally.

We can expect the air pollution to be bad these next few days... how visitor-friendly and how nice we get to breathe in this terrible air quality.

Why aren't our lawmakers pushing for the government to do more to improve our living conditions? Surely this is an issue everyone can get behind?

Potentially Deadly Air

A picture of smog from March 2010 and clear skies in June later that year

Now we know the air in Hong Kong is bad -- not as bad as China -- but pretty bad relative to the United States.

Scientists who have studied air samples around China and Hong Kong have found 10 to 20 times more fine metallic particles than the US.

While Hong Kong's PM2.5 levels are lower than most cities on the mainland, it has a higher concentration of health-threatening trace metals. These include zinc and chromium that can cause a range of problems from premature aging to cancer.

Higher concentrations of airborne trace metals can even damage human DNA, thus endangering the genetics in future generations.

The scientists say that without greater environmental regulations, high trace metal levels could become a public health crisis.

Li Weijun, a professor of environmental science at Shandong University has studied nearly every part of China, from the grasslands of Inner Mongolia to Hong Kong's Victoria Peak, collecting samples and examining them. They probably have one of the largest data banks of airborne particles in China.

"Damage to health caused by fine particles is not only determined by the quantity of particles, but also what type they are," he said. "Trace metals are the nastiest things in the air that can damage your health."

With regards to Hong Kong, the PM2.5 pollution, Li believes it could have come from power plants and factories in the Pearl River Delta.

"As long as you have a large number of factories in your neighbourhood, you will have the problem. But even the most advanced technology cannot remove these extremely small particles," he said.

Li published a research paper in the academic journal Environmental Science and Technology last year. In it, his team found 105 micrograms of iron per litre of water in cloud on Mount Tai in Shandong province and 90mcg on Mount Lu in Jiangxi province. At Mount Elden in Arizona, the reading was only 5.6mcg.

In terms of zinc concentrations, 200-250mcg were found on the two Chinese mountains, and none on Mount Elden.

The other metals or hazardous elements in China's air include copper, magnesium, lithium, nickel, cobalt, arsenic and selenium. When mixed with water, zinc can enter human cells via the bloodstream or tissue.

Through oxygen, zinc can damage the structure of DNA in cells and this is irreversible.

Is this not shocking enough for anyone living in China and Asia?

In Hong Kong we always knew the "fog" was smog and then chief executive Donald Tsang Yam-kuen said there was nothing we could do about the air pollution across the border.

But now we know what we're breathing in is potentially dangerous, particularly for babies and young children.

What is the Hong Kong government going to do about this now? The onus is now in Secretary for the Environment Wong Kam-sing and the under secretary Christine Loh Kung-wai to really do something about the air quality here.

Top expats are leaving the city in search of cities with cleaner air for themselves and their families because it's priceless.

We thank Li for this report as it confirms what we already know, but in much greater and scarier detail.

He must also be praised for his extensive research. It wouldn't be surprising to hear if the Chinese government tried to bar him from publishing this work because of its explosive consequences.

Mainlanders are already wary of air quality in China and this report gives further evidence that the country has sacrificed the environment and its people for GDP growth.

We need more people like Li to shake things up and make governments realize that change needs to start now.

Singapore's Talent Flow Concept

Could Hong Kong have mainlanders shuttling into the city daily to work?

A Singaporean has come up with a way for Hong Kong to solve its labour woes and housing shortage -- allow workers from the Pearl River Delta to commute to the city to work.

The brilliant plan comes from Paul Cheung, who was director of population planning in Singapore from 1986 to 1996. This is what the Lion City does at the moment -- 150,000 workers commute daily from Malaysia.

He says this idea is doable since transport links between cities in the Pearl River Delta region will be even better in 30 years.

"Importing labour is a very outdated concept, especially for Hong Kong. It should look at it as talent flow across the Pearl River Delta region," Cheung said.

"The core problem for Hong Kong is urban pressure. If the city adopts the flow concept, the loading on Hong Kong will be less," he added.

The Hong Kong government had planned to import more overseas workers to beef up the labour force which is expected to contract in 2018.

Cheung also gives the example of when he worked in New York as director of the United Nations Statistics Division, he said some workers commuted from the neighbouring state of Connecticut to Manhattan.

"There is no travel restriction between New York and Connecticut. People in Connecticut now can freely move to New York and work there and move back in the evening. The same can be true for Zhuhai and Shenzhen down the road," he said.

He is obviously unaware of the rising tensions in Hong Kong between locals and mainlanders. If they did cross the border to work in Hong Kong everyday, how would they be able to integrate?

While the majority of those living in the Pearl River Delta already speak Cantonese, there are so many cultural issues between Hong Kong and mainlanders that even trying to iron them out in a rational way would be overwhelming.

Cheung seems to have a simplistic view of the situation, just looking at it from a numbers point of view. Workers commuting between Connecticut and Manhattan is different from those crossing the border from Shenzhen or Zhuhai to Hong Kong to work.

Nevertheless he made an interesting observation after reading Hong Kong's consultation report.

"I don't get a good sense of what Hong Kong will be like 30 years down the road. There is no vision for the urban environment of Hong Kong, the liveability... as a home. It focuses only on... 'human capital' but ignores... other key issues, like pensions and elderly housing."

At least Cheung has that right.