Research On The Impact Of Rising Labor Costs On The Textile Industrial Upgrade In Hubei

Since reform and opening up, whit the advantage of cheap labor, China develops labor-intensive industries, and get national economy a rapid growth of 30 years.However, since 2004, "shortage of migrant workers" gradually spread, the population structure changes rapidly, working-age population drops, and provinces have raised the minimum salary according the "labor contract law", all these result in the rising labor costs. As a labor-intensive industry, textile has been seriously affected, so industrial upgrading has become the key to sustainable development. Based on this situation, this paper analyzes current situation of Hubei textile, influence and incentive effect of the rising labor costs to textile industrial upgrading. At last of the paper, services follow.Study of Hubei Province textile industry under the background--the rising labor costs to industrial upgrading--is not only beneficial to solve the problem of shortage of migrant workers, but also helpful to improve the total productivity, which can promote the textile industrial upgrading. So, the research of this paper has important theoretical value and practical significance. Firstly, analyze Hubei textile industry value chain from 3 aspects: asset size, technology level, labor intensive, establish textile industry LIP, measure Hubei textile industry overall upgrade status. Secondly,according to minimum salary increase, average salary and productivity of labor, get the reality of labor cost. Thirdly, on the basis of previous theories, get the effect principle of labor cost on industrial upgrading. Finally, analyze and prove affection of labor cost to industrial upgrading method and stimulation effect.According theory and empirical analysis, this paper’s conclusions are as follows:1) Hubei textile industry is in continuous upgrading, but the development is very uneven, the value chain is not complete, the textile and clothing is advantage while the coloration and chemical fiber industry is weakness. 2) With the changes of Hubei population structure, the increases of minimum salary, and some other reasons, labor costs rising is an irreversible trend, but at the same time, labor productivity is also incontinuous improvement, so labor costs rising will promote improvement of labor productivity, and industries upgrading. 3) With labor costs rising, Hubei textile enterprises will enhance R&D investment to improve technical level, which leads to industrial upgrading.This paper proposes recommendations as follow: 1) improve labor productivity by various methods. 2) improve salary growth system and the salary level of workers.3) enhance R&D investment, promote the ability of independent innovation and the transformation of scientific and technological achievements.