Money

'Worker shortage not powering computer hikes'

By Shi Jing (China Daily)
Updated: 2010-03-09 10:22

Escalating prices for computer hardware in Zhongguancun are not down to a shortage of workers, despite the fact that the slow return of migrant workers to the production lines had been blamed.

Memory chips and computer monitors are among the fastest rising items.

Kingston, the company that supplies more than half of the memory chip market, now sells its products for twice what they cost a short time ago. A two-gigabyte chip costs at least 300 yuan now while it sold for 130 yuan this time last year.

"The 2G memory chip was priced at 295 yuan yesterday, and it was selling for 305 yuan today here in my shop," said Liu Mei, a retailer at the electronics mall.

"There is no doubt the price will keep climbing this week because delivery to Beijing has been suspended in recent days to ensure a safe and sound environment during the sessions of the NPC and CPPCC. Therefore, the supply has been cut temporarily."

An employee in the store added: "Retailers are running short of stock and that's why the price has gone up. The labor shortage doesn't matter that much."

LED monitors, which entered the market in November and are now the best seller in Zhongguancun, have gone up in price by between 90 yuan and 180 yuan per set.

The cost of a 19-inch LED BenQ monitor, a Taiwan brand, has gone up from 780 yuan a set to 960 yuan.

"Of course, the labor shortage is partly responsible for the current price increase - a 1,200-yuan salary cannot meet workers' expectations now. But that has not turned the world upside down," said Liu Tao, a retailer on the third floor of the electronics mall.

"Prices will absolutely go up at this time of the year because producers sold most of their stock before the Spring Festival," said Liu.

"Retailers are now short of stock and that is the main cause of the increase. And as Taiwan has been recently struck by an earthquake, delivery has once again been held up. But the price will definitely go down by April."

A manager at Hilon Electronics Market also ruled out a shortage of skilled workers as the main cause for the current price increase.

"Although many migrant workers have postponed their returns to the cities this year, they are coming back to work now," she said. "And the labor shortage has nothing to do with the price increase in computer hardware, according to our recent survey of the market."

Liu Tao said there will be some good deals in a few months.

"Don't be in such a rush. Come and have a look later," Liu said. "The price is bound to drop during the summer vacation, which is the off-season every year. You can have a real bargain by then."