Problems mobilizing human capital, mom and pop loansharking, and other issues in China

Our previous post noted challenges that exist in high turnover of individuals in Chinese supply chain and logistics positions. Recent discussions have suggested that this problem is compounded by other serious infrastructural elements being set up by the Communist government itself!

For example, in China mobility to human capital is posing a serious problem. Some of these problems are unprecedented. For example, Chinese law restricts individuals from moving into major cities such as Shanghai and Beijing for employment. Individuals who do move to these areas are penalized, by not having access to government healthcare, and having their children denied access to local schools! These problems are unheard of for many Western companies doing business, and continue to pose human resource challenges.

Nevertheless, companies continue to expand in Asia, on a wave of government spending. Recent activity suggests that there is now an emerging “loanshark” industry growing as governments seek to tighten monetary supply. Upper middle class citizens are saving money
and then lending it privately at outrageous interest rates (100%!). Entrepreneurs in major cities are also disappearing rather than having to face repayment of loans….This recent wave of “mom and pop loan sharking” is an ominous sign of a serious loss of monetary control.