Whether The Comparative Advantage Of China's Labor Intensive Industry Still Exists

Since 2004, a phenomenon has spread widely in ZHUJIANG delta and Yangtse Rive delta, which was the lack of peasant worker in many factories. A great attention was paid to it in academe. Lots of scholars cried the bad working circumstance of peasant workers and awful low salary, but some scholars think low salary is the reason of interesting foreigners'investment. If salary rises, factories'manufacturing cost will rise, which may result that many companies transfer their factories out of CHINA, then, it is impossible for the peasant to get the salary as now. At last, China's comparative advantage in manufacturing will vanish. The writer think that the problem is of a great value to research, not only it has relationship with CHINA'trade, but also influence the whole industry development, even the building of harmony society.About this problem, the writer begins his research from two aspects.Firstly, analyze it on the angle of labor force's supply and demand. The character of labor intensive industry determine its demand for labor style, which is the big demand for youth labor force, especially for the young woman labor force. But present and potential supply of youth labor force is decreasing year by year, which must cause the scarcity of peasant workers. On the otherwise, most of the peasant workers have ever experienced the damage in their body or mind, which make them fear working outside. However, to be contrast, in recent years, government cancelled all agriculture tax and issued many policies available of production increments, which greatly boost peasant workers'opportunity cost of going out. Therefore, the lack of peasant workers is of some inevitability.Secondly, research the probability of other countries replacing CHINA's comparative advantage. As while as CHINA, the price of labor force in Vietman and Indian are both very low, and they both have a great progress in manufacturing development. So the writer choose the two countries to make a general analysis and get the conclusion as follows: Although Vietman's labor force is cheap, and has got some admittance from USA, but its population gross is only as much as that in Guangdong CHINA. So Vietman is impossible to replace China's status in international labor intensive industry. Then can India, the second largest population, undertake the mission? Many documents shows that a lot of factors restrict the development of Indian's labor intensive industry, such as the bad infrastructure , frequent politics and religion collision. The worse is the comprehensive labor protection policy, which directly add the cost of companies, so it is hard for India to replace CHINA. At last, the writer concludes that China's comparative advantage in labor intensive industry is still exciting.Although it is important to judge whether China's comparative advantage still exist or not, but what's more important is how to keep it last in long-term. Due to the characters of labor intensive, such as low enter threshold and the rising labor cost, it is unpractical to keep the advantage for ever. What CHINA can do is to get new trade comparative advantage by working hard. The writer proposed some suggestions according to the present situation. One is accelerate industry structure stepping up, the other one is to improve labor force working skill and living level. This two points is interpenetrating each other.