Shortage of skill
In need of better workers, Guangdong manufacturers set sights on automation
A28- year- old man surnamed Yang has been running from city to city looking for a job in South China’s Guangdong Province since he returned from his trip home for the 2017 Spring Festival holidays.
Yang, who has traveled to Guangzhou, Dongguan, Shenzhen and Foshan since he got back, had previously worked in the machine maintenance department at a SAE Magnetics plant in Dongguan for four years. He earned 2,500 yuan ($ 363.16) a month in 2011 and about 3,200 yuan a month in the following years.
After the SAE plant’s orders began to shrink in 2014, he said he felt hopeless about working there. So he moved to Guangzhou to work for Sony Electronics Huanan Co, a subsidiary of Sony Corp, until the Japanese company sold the subsidiary to the listed Shenzhen O- Firm Tech Co in November 2016, putting Yang out of job.
To explain why he has had to switch employers over the last few years, Yang pointed to the plight of the original equipment manufacturers ( OEMs) in the province. Because the electronics OEMs do not have their own core technology, their production schedules depend heavily on the number of orders they receive.
“They are much more vulnerable than other companies when the orders drop off,” Yang said.
It is no secret that some foreign eign firms have been moving their produc production lines to countries such as Vietnam, where labor costs are lower, he noted.
“You can feel that there are fewer workers here now,” said another worker, who preferred not to be named, as he looked out at an empty street in the town of Chang’an in Dongguan.
More and more young people balk at working around the clock in a factory for wages of around 3,000 yuan per month, said an employee at a consumer electronics products manufacturer.
“This is why the workforce cannot meet the demand in Dongguan,” he said. “Moreover, many manufacturers, which have been upgrading their production lines, want skilled workers who can make technological breakthroughs.”
Skills wanted
In 1991, the Shini Plastics Technologies ( Dongguan) Inc, a company from Taiwan, came to Dongguan, where it operated as an OEM for a decade, said Yi Daojiang, the company’s vice general manager.
“At early stage, our business was about making injection molding machine equipment for some other brands. But in 2001, we started to register our own trademarks and apply for patents,” he told the Global Times on Friday.
The company changed its strategy because the profit margins for OEMs were so low, Yi said.
Located in the town of Dalang, Shini’s factory is close to the Chaoguan highway. The highway links Dongguan with Chaozhou, another city in the province, which is more than 300 kilometers from Dongguan.
Despite sluggish global trade and pressure on economic growth, the company has invested about 20 million yuan – about 10 percent of its annual revenue – in research and development in recent years, Yi said.
Shini is not the only OEM that invested in itself to increase its chances of survival.
Other OEMs, as well as original design manufacturers ( ODMs), have been developing their own brands, said a representative from a human resources consulting firm that specializes in the region, who preferred not to be named.
“Highly skilled workers are usually concentrated in foreign companies or big Chinese firms like Huawei or Tencent,” she told the Global Times on Friday.
For the most part, OEMs and ODMs don’t know a lot about product positioning, quality control and other core technologies. These manufacturers are still fully controlled by their end customers, which may limit their capability to train workers, she noted.
Aiming to automate
In recent years, manufacturers in the province have been pushing ahead with plans to automate their production lines, particularly after local authorities issued industry guidelines that urged the region to become a leader in automated technologies.
By 2017, more than 50 percent of above- scale enterprises should finish a new round of technical remolding, according to the guidelines issued by the Guangdong provincial government in July 2015.
Under the guidelines, manufacturers should have 50 industrial robots for every 10,000 workers. And by 2020, advanced manufacturing output is expected to exceed 2.4 trillion yuan.
At the AtJida plant, located in the center of Zhuhai, also in Guangdong, industrial robots are set for 1,500 hours of nonstop testing. They are all designed and manufactured by the intelligent equipment technology institute of Chinese appliance manufacturer Gree.
“Here, we’re building a central data control room,” said Duan Yao, the institute’s general manager. “We have a dedicated team to develop software and to focus on collecting data from the machines and equipment so we can better monitor and analyze the data on a cloud server.”
Gree expects to reach the same level of automation as global leaders in industrial robotic automation – Japan and Germany, the general manager noted.
With regards to robotics density, the current level in Japan is 305 units per 10,000 employees, according to the World Robotics Report 2016, published by the International Federation of Robotics in February 2017.
The output of Gree’s automation business doubled from 550 units in 2012 to 1,100 units a year later, Duan noted.
“Before selling them, we’ll use them in the production process for two or three years, which will also test these machines at workshops,” Duan told the Global Times on February 14.