Whither Toy Manufacturing?

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There is a very interesting article in today’s South China Morning Post entitled “Mainland money pressures may squeeze toy makers out.”   The article acknowledges what toy industry members talk about, the eventual movement of toy manufacturing out of China.

It does so, however, in an interesting fashion.  It acknowledges that it is much harder to manufacture in China but ponders it moving back to Hong Kong as well as to Viet Nam or India in 10 to 20 years.

As the article puts it:  “Surging wages and a strengthening Yuan are pressuring Hong Kong toymakers to consider moving factories outside the mainland, including a possible return to the original toy making capital of the world – Hong Kong…These factors together with tougher safety requirements have clouded future prospects for the labor-intensive industry, which supplies nine out of 10 toys sold in the United States and employs tens of millions of migrant workers across the border.”

It seems highly unlikely that manufacturing would return to Hong Kong with its high wages and cost of living; the article as much as admits this.  It also seems unlikely that it will be 10 to 20 years before the migration takes place as it is already happening with at least one major manufacturer having moved all its production to Viet Nam.

Rather, the article appears to put a brave face on a very tough question.  Where is toy manufacturing going to be in one, three or five years?  The fact that the article was written shows it is a very real concern.  We need, however, to have some hard reporting on a subject that is crucial to all of us.

One thought

  1. The movement of factories westward has already begun. Follow the interstates to their end and that is where new factories are being located.

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