Childcare offer attracts workers in China’s tight labour market

opinion September 24, 2018 01:00

By Suwatchai Songwanich
Chief executive Officer,
Bangkok Bank (China)

After years of rampant growth in the manufacturing sector – which helped drive up wages and the standard of living across the country – demand for workers has been outstripping supply. Given the increasingly competitive and tight labour market, childcare is helping to give some Chinese manufacturers an edge when it comes to attracting emplo



A sizeable portion of factory and industrial workers migrate hundreds, even thousands of kilometres from their hometowns to find a job, often in one of the country’s major cities or key industrial zones. 

The offer of much higher salaries and a better life for their families not only leads many rural workers to move to another province, it often means leaving their children behind in the care of relatives. Typically, they only have sufficient time and money to visit home once or twice a year. The end result is some 69 million of these so-called “left-behind” children across the country. 

The issue is serious enough for the government to place it on the national agenda while in the private sector many employers are using childcare, education and family housing as incentives to woo workers. This is proving more effective than simply offering higher salaries because of the cost savings from childcare, better education opportunities than can be found in the provinces, and, most importantly, keeping families together. 

A number of large manufacturers are developing and piloting such schemes with a view to making them more broadly available. Businesses will have to carefully balance costs as China’s manufacturing is facing intense competition from cheaper labour in other markets, such as Vietnam. Either way, it is heartening to see companies developing an offering that provides real social benefits.

Thailand should take the opportunity to learn from this approach as we will face our own intense demographic pressures in the coming years.

Thailand is well on the way to becoming an ageing society. The working population is forecast to contract from this year, with the overall population starting to decline from about 2030. 

Meanwhile smaller families will have increasingly middle-class aspirations in areas such as lifestyle, earnings and education for their children. Many working people will also shoulder the dual responsibility of caring for ageing parents while providing for their children. 

Businesses will be challenged by these changes and forward-thinking ones can start developing themselves as employer brands – companies where people want to work because of the culture and opportunities for employees – now. 

A simple and powerful offering would be to start providing creches and early-year childcare for young parents wanting to get back to work. This would also enable more women to return to work faster, empowering them while supporting the economy at the same time.

The biggest bonus would be happier families all around.

For more columns in this series please visit www.bangkokbank.com.