Labor costs force shoemakers inland

Guangdong's labor shortage and higher costs are prompting manufacturers to move some production inland and to Vietnam, the South China Morning Post reported. It said Zhuhai-based Kingmaker Footwear Holdings is rethinking plans to expand capacity at its plant in nearby Zhongshan and instead looking at Vietnam to handle as much as 40% of output. The daily also said contract shoemaker Yue Yuen Industrial (Holdings) was planning to establish production facilities in southwest Jiangxi province where labor and utility costs were 30% less than in Guangdong and better roads now halved transport time to Shenzhen's Yantian Port to only six hours. A Hang Seng Bank report said labor shortages in Guangdong, Fujian and Zhejiang challenged the conventional wisdom of �a seemingly inexhaustible Chinese workforce", predicting low-end manufacturing would migrate inland.