Declining working-age population and increasing wages are two critical manpower issues with China’s manufacturing nowadays. To maintain its global competitiveness, China is rushing to automate its manufacturing industry.
Recently, the average monthly wage for a worker in China is 656 USD (or 4.134RMB), according to the International Labor Organization. This also means, China’s per capital salary is ranked 57 among surveyed 76 countries. Compared with the global average salary (1.480 USD - ~ 9.328 RMB), China’s is still quite low, which can help China keep its certain global competitiveness, but it now is higher than the previous years.
Besides, according to the report of China’s National Bureau of Statistics, the working-age population, which is defined as those between ages 16 and 59, fell by 3.710.000 in 2013 to about 915 million in 2014, accounting for 67% of China’s total population.
With the prospect of fewer and more expensive workers, there is no surprise when the companies in Guangdong and elsewhere in China - export-oriented provinces - now are rushing to automate, in particular their assembly processes.
One of the companies that have been automating their manufacturing is Gree Electric Appliances Inc. of Zhuhai. This company increased its productivity through an automation program initiated in 2012 when starting to manufacture its own robots, automated guided vehicles (AGVs) and other automation equipment. In Guangdong, Gree has 150 injection moding machines connected to a centralized material feed system. Hot stamping is integrated press-side, while conveyors are used for part transfer. Further, AGVs are employed to transport tooling and inserts to the injection presses.
While Gree reduced its headcount by 10.000 in 2014, to a total of 80.000, simultaneously raising revenue from around $19.4 billion in 2013 to $22.6 billion, Media – another major player in the appliance field – was going to slash its air conditioner division workforce of 30.000 by 6.000 by the end of 2015 at its factory in Foshan, Guangdong, and even a further 4.000 by 2018. Media invested $145 million between 2011 and 2014 to install automation systems incorporating some 800 robots. It plans to spend a similar amount to add another 600 robots this year.
Perhaps the most ambitious automation project in China was announced by electronics manufacturer Foxconn in 2011. As of 2014, over 10,000 robots had been installed on Foxconn assembly lines, and the company's plants were 40% to 70% automated. However, according to a report of the Industrial Relations Network, “most Apple products are still assembled by people because mechanical devices can scratch the products' alloy cases, but fingers do not." – a Foxconn Engineer said.
Gree, Media and Foxconn are big, but automating is also necessary for smaller Chinese manufacturers when they want to maintain their global competitiveness. Bluestar Mould Group is not an exception. The Group has been aware of these critical manpower issues since early and has been acting to deal with them. Enhancing manufacturing capacity and innovating technology with automation are the first prioritized solutions at Bluestar Mould Group. However, automating is just one of our solutions, which are fully mentioned in: Chinese mold maker deal with cost problem.