In response to dynamic market conditions, production companies have undergone significant transformations, shifting from practices such as reducing production and implementing rotational rests to operating at full capacity. The textile industry, traditionally labor-intensive, faced setbacks as a prolonged market downturn forced entrepreneurs to cut costs, resulting in reduced production, furloughs, and discounted wages, leading to a loss of skilled workers.
China, as the world's largest exporter of textiles, has long thrived on its labor advantage. However, since 2012, rising labor costs have posed challenges as the demographic dividend diminishes. Surveys reveal wage disparities, with southeastern coastal regions paying textile factory workers between 5000-10000 yuan, while central and western regions offer wages ranging from 3000-6000 yuan.
Five years ago, labor costs accounted for only 20% of company expenses, but the figure has now surged to 60%, causing additional challenges such as employee instability and high turnover rates. The increase in labor costs is attributed to the rising cost of living, coupled with a decline in the labor force. The textile industry's demanding nature has led to a generational shift, with workers from the "80s" generation retiring, and those from the "90s" and "00s" generations displaying less interest in the industry, contributing to high turnover rates.
Simultaneously, raw material costs are escalating. Previously, labor costs constituted around 30%, but they now exceed 50%, while material costs have risen to 40%. This trend makes achieving a 5% profit margin challenging, necessitating large-scale production for profitability. However, the inability to raise product prices squeezes profit margins, placing considerable pressure on textile enterprises.
The industry faces two prominent trends: a shift from eastern to central and western regions within China and a migration from China to Southeast Asia and India. Some eastern cities, once textile industry hubs, have witnessed a decline in the sector's proportion within their industrial structure.
For example, in Huzhou, Zhejiang Province, the textile industry's contribution decreased from 51.6 billion yuan in 2015 to 24.1 billion yuan in 2019, despite an overall increase in industrial revenue. In Shaoxing, Zhejiang, a city heavily reliant on the textile industry, various subcategories experienced a decline in production from 2015 to 2019, reflecting the industry's challenges.
Amidst these challenges, SUNTECH Textile Machinery emerges as a key player, offering a diverse range of products, including fabric relaxing machine, automatic fabric roll packing machine, beam storage, and fabric inspection machines. With innovation and extensive experience, SUNTECH Textile Machinery remains a leader in the evolving textile landscape, welcoming inquiries and cooperation opportunities from industry stakeholders.
