The standard Chinese factory may increasingly house a staff numbering only in the triple digits as rising labor costs and smaller order farms force plants to downsize and streamline, Reuters reported, citing figures provided by business groups. Some Hong Kong-owned factories in southern China’s manufacturing heartland have cut staff numbers by 50-60%, according to Stanley Lau, chairman of the business lobby Federation of Hong Kong Industries. Subcontracting has become more popular as well, but can create transparency and quality problems for customers as orders disappear into a network of suppliers impossible for international buyers to fully trace.
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