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China's garment hub leans on robotics to stay profitable
26
Jun '15
Rising labour costs and cut-throat competition are forcing the garment industry in Dongguan to invest in robotic technology to increase the bottom line, according to reports in the Chinese media.

High-tech machines from Germany, Italy, the US and Japan have been installed, along with Chinese lines, as clothing companies struggle to recruit unskilled staff in the battle against cheaper rivals from Vietnam, Cambodia and Bangladesh, a leading Chinese newspaper has reported.

Located in South China's Guangdong province, Dongguan is known as the capital of China's garment industry. Last year, the city's 520 manufacturers exported $7.5 billion worth of apparel products and fashion accessories, according to Huangpu Customs. This was a rise of 3.8 per cent compared to 2013, but a far cry from 2008 when the city shipped goods worth $113 billion. In a bid to retain global market share, investment has increased and even skilled staff have been trimmed.

"High-end garment machines have become popular with factory owners as they reduce spending on training skilled workers," Chen Yaohua, chairman of Dongguan Association of Textile and Garment Industry, said. "Most of the factories in Dongguan have installed cloth-making machines imported from Germany, Italy, the US and Japan along with homegrown technology."

Even so, there are still more than 13,600 unskilled job vacancies in the sector, Li Ganqiu, spokesman for the Dongguan Economic Development, Science and Information Technology Bureau, pointed out.

"Although nearly all the garment factories in the city are equipped with different types of machines and levels of technology, many are still short of hands," Li said.

Wages have also become a problem. The average monthly salary of a garment worker soared to about 3,200 yuan ($516) in March, a 12 per cent increase compared to the same period last year.

Part of the reason for the increase is that factory owners need to pay employees more for working extra shifts. This comes at a time when cheaper fashion products are rolling off the production lines in India, Pakistan, Vietnam, Cambodia and Bangladesh.

To combat mounting competition, the industry, which is labor-intensive, has turned to technology. Garment-making machines can be operated by fewer workers and this can cut costs by more than 30 per cent as well as boosting productivity by 40 per cent, the report said.

"By introducing this robotic technology in different workshops, a medium-sized factory can bring down its workforce from 1,200 to 800," Chen said. "They can also help prevent material waste and increase manufacturing accuracy."

Although this rush to bring in technology will not completely automate factories, the number of workers needed will be reduced as garment companies look at new ways to survive in a changing business landscape.

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