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Home > Business > PTI > Report

Developing nations may lose jobs to China

September01, 2003 19:22 IST

As resentment grows among US workers about migration of jobs to cheaper countries, American experts and media on Monday warned that even developing nations could lose jobs in the manufacturing and textile industry to China because of the rock-bottom wages there.

"With wages for Chinese factory workers averaging six dollars a day compared to two to three times that amount in the US for an hour's work, jobs are moving to China not only from the US but also from other developing countries like Mexico, where wages are much below those in the US but much higher than those in China," the Washington Post said in an editorial on American Labour Day.

Bruce Raynor, president of UNITE, a union of 250,000 apparel, textile, laundry and distribution workers, wrote in an article in the daily: "Since January 2000, 520 manufacturing plants have closed in Mexico most of them moving to China.

"In 2005, when all apparel and textile quotas are to be lifted, developing countries around the globe will be faced with a massive loss of jobs as the industry moves into China.

"For example, a United Nations study predicts that Bangladesh will lose one million apparel jobs when quotas are abolished. Many other countries, in Africa, Asia, the Caribbean and Eastern Europe, where the apparel industry is the largest employer, will also suffer huge job losses when quotas are lifted," Raynor wrote.

The Post editorial bewailed the loss of both blue collar and white collar jobs to countries like China and outsourcing to countries like India.

Some states like New Jersey are moving to punish corporations which, to stay alive in the global market, have to outsource some of the jobs, the Post said.

"In a survey of the world's 100 largest financial services firms, Deloitte Research found that these companies expect to shift $356 billion worth of operatives and about two million jobs to low-wage countries over the next five years," Raynor wrote.

"These developments appear already to be affecting wages in some sectors. According to Sharon Marsh Roberts of the Independent Computer Consultants Association, outsourcing has forced down hourly wage rates by 10 per cent to 40 per cent for many US computer consultants."

Raynor wrote that the usual response of policymakers to manufacturing workers who have lost their jobs was to preach the virtues of education.

"Workers are told that if they would only acquire new skills, they would qualify for white collar service jobs that are safe from economic forces that have shifted millions of factory jobs to foreign countries.

"Perhaps that was once true. Today, white collar jobs - telemarketing, accounting, claims adjusting, home loan-processing, architectural practices, radiographers and even some state and local government jobs are going offshore," he wrote.

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