China has built its rapid ascent on the shoulders of its migrant workers, but higher living costs and the tough conditions migrant workers face have deterred them from moving to cities, causing a looming labor shortage and slowing economy that are worrying top legislators, says an article of AFP. Excerpts:

Though rural wages are forecast to maintain an average growth of 13 percent a year during the next four years, an export slowdown has forced many employers to cut wages and benefits, even as inflation hit a three-year high of 6.5 percent last July. Businesses in cities are facing an uphill battle to recruit China's 6.8 million graduates.

Many migrant workers, including office workers who had planned to find jobs in big cities have decided to leave or return to their hometowns where the cost of living is lower.

Also, in cities at the county-level or below, it is easier for people with stable jobs and residences to apply for hukou (or household registration system), which is a more attractive option for job seekers.

Under the current hukou system, migrant workers are unable to access healthcare or education for their children in the cities where they work. It is one of China's biggest social challenges, which the government is focusing on as it is important for migrant workers to move into cities and contribute to economic growth.

The issue is expected to be high on the agenda when the country's top legislators meet this week for the annual session of the National People's Congress. It is believed that China's State Council will reform the hukou system and more details may emerge with the release of Premier Wen Jiabao's work report.

(China Daily 03/06/2012 page10)