On how migrants from Sichuan will help complicate China's economic growth

The first I heard about the large-scale migration from the Chinese interior province of Sichuan to richer areas on the Chinese coast came with last year's earthquake, when Reuters covered? Sichuanese migrant workers in Beijing concerned about their homes.

Ye Shao did not feel a thing when China's most ruinous earthquake in decades struck in her home province of Sichuan on Monday, sending shockwaves that panicked residents from Shanghai to Bangkok.

"I was delivering vegetables at the time, but I thought it strange that all these people were running out of buildings on to the street," Ye said.

Four agonising hours later, Ye thanked heaven her parents, who live about 100 km from the epicentre at Sichuan's Wenchuan county, were outdoors when the quake hit.

"They are now living in tents in an open field. Our family home is ruined. Of course, I'm worried for them, because I've heard there may be more aftershocks," said Ye.

As state media reported on Thursday that the death toll from the 7.9 magnitude quake could rise to more than 50,000, Sichuan migrant workers in Beijing talked gloomily of broken homes, dead neighbours and fears for relatives living in desperation.

Forming a large part of China's 150 million surplus rural workers, whose cheap labour has fuelled blistering economic growth, millions of Sichuanese have migrated more than 1,000 miles to work in booming cities like Beijing and Shanghai.

Many have left spouses and children in poor villages at home in a bid to better their prospects.

UNESCAP noted in its summary of Sichuan's demography that, despite economic improvements, the province was still fairly poor, with a high population density in usable lands and relatively low standards of education even as China's reforms have made peasant life more difficult, especially but notn only for women, and with Sichuan's mountainous areas suffering especially high levels of poverty (though these latter tend to migrate within Sichuan). Notwithstanding an exceptionally rapid demographic transition over the 1980s despite some problematic statistics, Sichuan like other provinces of the Chinese interior had a large labour surplus.

Where do these people go? They head to the richer parts of China where they have a huge impact on the country as a whole, on areas in Sichuan receiving remittances as on the migrant-receiving areas themselves, where Sichuanese and other migrants formed the majority of the labour force in some sectors of the southeast Chinese economy. Irena Omelaniuk observed in 2004 that provinces like Sichuan which produce the bulk of China's internal migrants produce relatively few international migrants, Sichuanese migrants instead moving to provinces like Fujian and Zhejiang which are themselves disproportionately important sources of China's international migrants, as caught in passing in this Slate article. In a very real sense, Sichuanese and other migrants fill the employment and other gaps left by international migrants and then some.

What consequences will this have? It may be worth noting that China's regional languages are probably going to be doomed. These migrations of Putonghua-speakers, combined with state education and services in that languages, is marginalizing regional langauges like Shanghainese and Cantonese, in overseas Chinese communities and certainly in China itself: by the time that people concerned for Cantonese's future are complaining about this in Putonghua, you know that the language's future is grim. If, as I blogged back in July, the cohort fertility of Shanghai's native population is dramatically below replacement and migration is the only thing that will ensure the city's population growth, the odds that Shanghai will switch over to the national language are that much higher.

Just as importantly, thse migrants from Sichuan (and other poorer areas within China will help keep the Chinese economic model going for a bit longer. Edward observed back in 2007 that rural China was quickly heading down the route of sub-replacement fertility, while Claus noted back in 2008 that rising expectations and shrinking migrant flows were creating labour shortages in some industries. China may, as the recent Economist article suggests, be able to continue shifting labour from its poor rural areas to the cities, a relatively more educated and urbanized workforce shifting to value-added products as this IIASA projection suggests.

First of all, China is expected to become a “world factory” with rapid growth of manufacturing enterprises in global production network, due to its cheaper labor cost, easier access to regional markets and increasing foreign direct investment (FDI) after China’s accession to WTO (C. Gu, 1999; D. Webster, 2002). The manufacturing enterprises usually are labor-intensive and require large amount of workers with a relative low education level and skills which new rural-urban migrants can fit in. Secondly, the tertiary industry in cities and towns has great development potentials. Currently, the tertiary industry in Chinese cities and towns is rather backward and less developed. With increasing income and living standards, the demand on services will rise strongly. Thirdly, urbanization as a process creates economic growth. It has been observed everywhere that per capita income is higher in cities that in rural areas. The reason is simply that productivity is higher in cities. This is true not only of labor productivity, but also of capital productivity, and even for infrastructure productivity. By moving labor and capital from lower to higher productivity areas, it automatically increases average productivity (P. H. Remy, 2000) (56-57).

As Scott notes it may as easily throttle China's prospects, forcing it to depend still more heavily on exports to support its rapidly aging population as it fails to increase its productivity as quickly as one might want and its aging population becoming net consumers instead of net savers.

The situation will be severe in the rich provinces of the south and east. What, I wonder, will things be like in the poor centre, west, and north of China, places which haven't prospered nearly as much as the favoured coastal regions and which are net senders of migrants in the bargain? In a decade's time, observers may be talking about the hollowing-out of Sichuan and its neighbours, with obvious consequences on China's internal divisions and stability.