Same but different—the U.S. and China's demand for labor
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As the financial crisis and accompanying doomsday scenarios fade into the distance, countries are regaining their confidence and striving for strategic advantages politically, economically, and militarily, but a competitive edge in economy is the most vital, and the demand for labor can directly reflect its economic strength and competitive power.
Job opportunities in the U.S. increased this April, the Wall Street Journal reported on June 16, which indicates the U.S. job market has improved after a period of stagnation, while China's labor demand began to rise last December.
In the U.S., engineering, medical care and information technology industries have the highest growth of labor demand. New demand for technical and business service staff increased 24 percent, education and medical service seven percent, although job vacancies in government agencies have declined sharply, down eight percent in April compared to March. In contrast, the labor demand in China has been primarily in mining, manufacturing and real estate.
Why differences in labor demand?
First, the U.S. and China have different divisions of labor in the international industrial chain. The U.S. is playing a vital role in global trade and investment and research and development. The global financial crisis has further stimulated technical innovation, industrial upgrades and restructuring. The innovation of information, biology, nanomaterials, and marine space industries in the U.S. has progressed in the wake of the economic crisis. However, China's position in the industrial chain hasn't allowed it to benefit in these areas.
Without a doubt, the two countries have different levels of industrial upgrades. Labor demand from the first and second industries in the U.S. have risen 35 percent and 67 percent respectively, while the numbers in China are 77 percent and 41.5 percent, which shows that the degree of industrial upgrades in the U.S. is much higher than in China.
The U.S. is now gearing toward a green economic recovery plan that promotes the industrialization of low-carbon technology in order to foster more competitive strength. China must also focus on developing new energy and eco-friendly industries to form new economic growth.
It's no secret that China and the U.S. have different levels of industrialization. Capital-intensive companies generate 85 percent of U.S. labor demand, while China's labor-intensive job opportunities account for 78 percent of its labor market. The U.S. service economy is capital-intensive. However, China's economy will continue to be dominated by labor-intensive industries for the long term.
Developed countries have advantages in scientific innovation and new industries, while developing nations have great competitiveness in traditional manufacturing, but they face disadvantages in the international division of labor. China would be wise to enhance cultivation of new industries while maintaining its strong position in traditional industries.
(This post was first published in Chinese and translated by Yang Xi, June 23, 2010)
