Tuesday, 3 March 2020


China’s stranded workers drag down coronavirus-stricken economy
Beijing’s aim to kick-start factory operations stymied by labour and transport woes

Li Zhenguo is trying hard to return to work after spending five weeks at home in Zhumiao, a village in the central Henan Province. But there is no public transport between Zhumiao and the nearest city of Zhumadian. From there Mr Li, 51, could hop on a high-speed train bound for the southern Guangdong province where he works as an assembler for a battery factory. Even if he somehow could make it to the railway station, though, he would not be able to afford the train ticket. The high-speed train costs more than three times the regular service, which has not operated since January. “I can’t go anywhere until traffic returns to normal,” said Mr Li. Tens of millions of Chinese migrant workers, mostly from the under-developed hinterland, are also stranded. Since the end of the lunar new year holiday, they have been trying to return to coastal factories after Beijing restricted traffic to contain the fast-spreading coronavirus.

 The toll that the travel restrictions have taken on the economy underlines the challenges confronting China. While Beijing said that 70 per cent of big businesses were operating again, the figures for small factories in particular are dire. Recommended ExplainerCoronavirus Why a Korean cult is at the centre of a huge coronavirus scare The Ministry of Industry and Information Technology said last week that less than a third of small and medium-sized businesses, which employ almost 80 per cent of China’s labour force, are operating normally. “Labour shortage is making any effort to kick-start the economy a futile one,” said Larry Hu, an economist at Macquarie Group. Since Beijing declared the epidemic a national emergency in January, local governments have imposed strict limitations on resident’s movements. The measures are especially stringent in the countryside, where roadblocks have prevented residents from even visiting neighbouring villages.

The virus may be showing signs of abating on the mainland, with the number of new infections falling to zero in many provinces, according to official figures, but rural authorities have been reluctant to ease the lockdown. In Zhumiao, which has never reported a virus case, villagers must pass through at least three checkpoints to get to the nearest bus station, which remains closed. To travel outside the village for work, residents need a certificate from their employer stating the business has reopened as well as a written pledge not to return to the village until the epidemic has ended. The requirements create a virtual travel ban for those without a formal job. Zhang Yanwei, a resident of Zhumiao, said he had put off a planned trip to the northwestern city of Lanzhou to find plumbing work as he did not have a contract. “There is nothing I can do except wait,” said Mr Zhang, 31. We can’t run a normal business when half of our workers are trapped in their rural hometown in Henan

 By the end of last week, less than a fifth of Zhumiao’s adult population had left, according to the local government. Before the holiday, almost the entire working age population in the village was employed elsewhere. But these problems are not restricted to Zhumiao. A Wuhan university survey last week of 104 villages in 12 inland provinces found that less than a third of local adults had travelled outside their hometown for work after the lunar new year. Normally between 80 and 90 per cent of adults travel for work. Industrial activity has been severely dented as factories desperately seek workers to run the assembly lines. The labour shortage helped push China’s manufacturing purchasing managers’ index, a gauge of economic health, to a record low of 35 in February. “We can’t run a normal business when half of our workers are trapped in their rural hometown in Henan,” said an official at Yaoxin Glass Company in the eastern city of Hangzhou. 

 Beijing has tried to improve labour mobility with many coastal cities arranging buses and even aircraft to pick up migrant workers in the interior. Their efforts, however, have failed to solve the problem. The special bus service only stops at certain villages meaning that workers living elsewhere cannot make it to the rendezvous point. A Wuhan-based scholar said maintaining traffic controls was understandable because local officials would be held responsible for allowing, even unknowingly, virus carriers to spread the epidemic. This is particularly challenging for officials as carriers often do not show any symptoms until many days after being infected. “Local governments will face political pressure by relaxing control because the outflow of migrant workers could translate into an export of risks,” said the scholar. “Their best option is the keep the status quo and wait until the central government says the turning point has come.” Back in Zhumiao, disease prevention remains a priority for authorities even though most villagers have stopped wearing face masks. An official at Qihai Township, to which Zhumiao belongs, said the government was discussing when to resume the bus service. “Our main job is to eliminate the virus,” the official said, “and free movement of people will make our work harder”.

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