China's coastal region is short of an estimated 10 million workers, with the Pearl River Delta region needing between 2 million to 3 million.

Experts said on Wednesday that this shortage should motivate labor-intensive manufacturers to update production processes and improve working conditions.

Zhang Yi, from the Institute of Population and Labor Economics at the Chinese Academy of Social Sciences, told China Daily that structural changes of demography is a major cause of the problem.

The country's family planning policy, which has been running for 30 years, has resulted in decreasing numbers born in 1980s and 1990s, Zhang said. And the young make up most of the country's millions of migrant workers.

Zhang said many young people are fairly well educated, unlike their parents who finished only middle school before going to cities to earn a living.

"Increasingly more young migrant workers do not want to work in labor-intensive factories which pay low wages and produce low value-added goods," he said, adding they want a more decent job and have higher self-expectations.

Another reason, he said, is that many enterprises have moved to inland cities, giving locals the choice of working nearer home.

Also, the end and beginning of a year are peak times for labor shortages because that's when contracts expire and the traditional Chinese New Year holidays fall. "Many workers go back home and choose to start their own business and never come back," he said.

Lu Xuejing, from the Capital University of Economics and Business in Beijing, said migrant workers in coastal regions are "short-term laborers" who frequently change jobs. It leads to shortages in factories that pay low wages.

Migrant workers want to become urban residents, but the low wages, higher living costs and housing prices have broken their dreams, Lu said. "It's hard for them to really adjust to urban life, so it's not easy to settle down."

Zhang compares the relationship between workers and employers in many factories as "merely naked employment without sensation".

"Labor shortages have been occurring in China every year from 2003, except in 2008 when the financial crisis crunched," he said.

But Zhang said the shortage should push low-end product manufacturers to update their equipment and change their strategies in a market dependent on overseas orders.

"To produce more high value-added goods will not only enhance manufacturers' competitiveness but will also be conducive to attract laborers," he said.

Lu suggested more favorable polices to help workers settle in the city.

"Although all provinces had raised the minimum wage standards last year and some plan to raise further this year, high prices to rent an apartment and for children's schooling have become big problems that hamper workers' desire to stay," she said.

In Guangdong Province, the country's manufacturing hub, the number of school-aged children of migrant workers reached nearly 2.8 million in 2009, People's Daily reported.

(China Daily January 6, 2011)