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High labor costs force some Chinese textile firms to shut
07 Nov '12
1 min read
Several small scale units in China have closed down since they were running in loss due to high labor cost and rising raw material prices.
Many of the global textile and apparel importers are shifting their orders to countries like India, Pakistan and Vietnam because the prices in these countries are about 10 percent lower than in China.
In China, the labor cost is 38 percent higher, while raw material cost is 70 percent more than the costs prevailing in other competitor countries, according to industry analysts.
According to some of the small textile units, fewer orders are coming from the global market as compared to last year and many of the companies had to shut down due to loss.
The textile and garment exporters rely on export volume for profit margin, but the actual profit is decreasing day-by-day, they aver.
Fibre2fashion News Desk - China
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