New laws being introduced in China this month are set to push up employers' production costs.

A new Labour Contract Law in mainland China is expected to push up the costs faced by manufacturers in the country because it provides protection to employees from sudden layoffs, as well as ensuring that they are well compensated in the event of being made redundant by their employer.

"Already, manufacturers are burdened by external factors such as the rise in gold and stones prices, so indeed this development will be a challenge for manufacturers as it will add to our overhead costs," warned Ben Yep, President of Bri-Star Jewelry International.

Bri-Star operates a factory in China that has over 1,000 employees and is one of many jewellers that will see the costs of producing items increase significantly because of the new legislation.

However, he added that although the new rules may not be good for manufacturers in China, it will have a positive effect on the long-term growth of the country.

He concluded: "I am confident that this policy will contribute to the long-term stability of the country because in reality, in spite the increasing number of noveau riche, there is still a large percentage of the population that is very poor."

Sources:

New China labour law takes effect this month, 1/01/08
http://www.jewellerynetasia.com/industry/newsdetails.aspx?lang=0&vortalid=1&newsidinvortal=7562&ct=&cn=NewsAll&m=01&y=2008&ch=0

Highlights of China's new labour policy 1/01/2008
http://www.jewellerynetasia.com/industry/newsdetails.aspx?lang=0&vortalid=1&newsidinvortal=7563&ct=&cn=NewsAll&m=01&y=2008&ch=0

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