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Shortage of skilled staff a stumbling block to China's marine expansion

By IBI Magazine

Training is vital if China is to take its seat at the top table of the marine leisure industry, so ran the uncompromising message of a number of speakers at the inaugural Boat Tech China Conference that began yesterday in Guangzhou.

Speaking on day two of the conference, to the 70-plus foreign, English speaking contingent at the event, David Winter, majority shareholder of the Red Dragon Yacht Building Company, that builds 19ft-41ft day sailors for the domestic and export markets - highlighted training as key to the success of any company looking to set up operations in China and spelt out some of the pitfalls of doing business in the country.

Developing skills and the retention of staff were two major issues for any company looking to set up business in China according to Winter, who gave a candid account of his own business's rocky road to success following its setup three years ago. "You can't arrive here and get skilled workers overnight. They just don't exist," he told a near-full auditorium this morning in his speech: 'Recruiting, Developing, and Maintaining an Effective Workforce for Optimum China Production'. "Most workers are transient, coming in from rural areas with little or no skills. There are people with experience in boatbuilding but it tends to be in the commercial sector that has different standards to the leisure sector."

He also warned against expecting to pay rock-bottom wages for staff. "Don't believe entirely what you hear in the international press. Yes there are people earning RMB600-RMB700 a month (around US$60), but they will be unskilled. Boatbuilders will usually have to pay quite a bit more as they will probably be in the more expensive areas (by the coast) and will need a higher level of expertise." He indicated that a skilled tradesman would expect to be paid anything up to RMB2000 a month, with senior admin staff demanding possibly twice as much again. He also added that there were hidden costs to ensure a company doesn't fall foul of the National Labour Laws. "You will find yourself paying for more than three weeks of public holidays and you have to pay for a hefty tax to the city where your factory is based if you employ someone from a rural area."

Winter added that staff retention was a real problem. "Anticipate 50 per cent turnover of staff," he said.

The subject of training had been the focus of Richard Downs-Honey's talk: 'Eduation and Training: The Key to Success' delivered on the first day to Chinese speakers and local boatbuilders. Downs-Honey, who is noth managing director and co-owner of High Modulus and vice president of New Zealand's Boating Industry Training Organisation (BITO), outlined the progress BITO had made to develop a comprehensive training programme to help overcome the shortfall of skilled boatbuilding staff in New Zealand. The programme is currently being trialled in Nova Scotia and Downs-Honey added that if those trials were succesful, then BITO would consider the possibility of offering similar help to Chinese marine companies.

(4 April 2006)

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