It’s no secret that China’s population is ageing. Under demographic pressure, the country is facing a higher demand for manufactured goods, but a slightly smaller, and much more expensive, blue-collar workforce.

No longer the production powerhouse of 90s legend, the country needs to restructure its industrial landscape in order to meet demand.

The solution: robots.

South China’s approach to this issue is nothing new in global terms, but the scale and speed can be considered nothing short of remarkable. Over the next three years, the Guangdong government aims to replace its industrial labor force with robots. In order to achieve this aim, they are willing to subsidise the conversion of nearly 2,000 production facilities across the province.

China is not necessarily suffering from a lack of labor; it is suffering from a lack of the right kind of laborers.

Over the last decade, the migrant labor movement, which brought rural workers to urban industrial centres for work, has become increasingly restricted as China’s major cities become overcrowded. The hukou registration system, which often ties a worker to his or her birthplace, regulates the travel of migrant workers across China. Rural labour has not “dried up”, it has simply become more restricted, particularly in the country’s already-overcrowded urban centres.

In some cases major manufacturing hubs, like South China’s Guangdong Province (excluding Guangzhou and Shenzhen), have benefited from a continued loosening the hukou regulatory system.

A migrant labour-force is readily available, especially in second and third-tier cities.

The issue is not simply a lack of available bodies to work the production lines across the country. Foreign and domestic companies alike are citing a lack of adequately qualified blue-collar workers as their primary human resources concern. Andreas Dick, President of FAW-Volkswagen’s most modern and most environmentally friendly production facility in China, describes the lengthy process of training required to ready their workforce for the production line:

We hired most of [our workers] very early to qualify them in the specific skills they need here. A lot of them worked for two years or more at our headquarters in Changchun, to get specific qualifications for maintenance, quality and so on. The program is with qualifications in Changchun, partly abroad, at Audi or Volkswagen in Germany, or with the suppliers. We have a very specific qualification program for every single group of employees. We did a lot to develop our people.

As China transitions from “the factory of the world” towards high-volume, high-end manufacturing, demand for highly-qualified blue-collar workers will only increase. Companies like Volkswagen must invest a huge amount in each individual worker, in order to maintain the necessary standards for high-end production. Similarly, workers must commit many years to the training process, in order to be fully qualified for work.

The issue with migrant workers is their transience. A company cannot invest in a migrant worker in the same way as a permanent resident. A migrant worker is too free to take the skills gained through such training programs, and leave for another firm in search of a higher salary. In this way, the vast number of available laborers is no longer enough to supply the demand for highly-qualified permanent staff members. Enter: robots.

Already, the Volkswagen factory in Foshan is 70 percent automated, with the majority of its production line powered and put-together by highly efficient KUKA robots. In some sections, blue-collar laborers work hand-in-hand with robot assistance; in others, the entire production line is fully automated, with only a supervising human worker.

Another issue facing many production-based companies is the expense related to both the current salaries of workers, and inevitable future wage increases. As companies seek to snap up fresh graduates from renowned technical colleges, a major concern is the local minimum wage.

Though robot labor represents a high initial investment, the main appeal is consistency. With robot labor, even the heaviest work will be precise and high-quality. Even where humans are working alongside robots, the ability and strength of the robotic assistance is far superior to that of an unaided human. More importantly, it does not run the risk of annual wage increases, and removes workers from the most dangerous or uncomfortable working conditions. The transition to robot labor seems natural, and logical.

Of course, there are many dangers associated with improper training, or even just human error, when working with robots. Many will remember the factory worker killed in Germany earlier this month, when he was grabbed and impaled by an industrial robot. Also in Shanghai, another German engineer was impaled and badly injured when an automated machine was left running while he inspected it.

With less of the labor-force filling basic production-line positions, and with companies investing more in the training of available talents, the overall skill-level of China’s workers will increase. In theory, the automation of China’s manufacturing will reinvigorate the entire production process, from the quality of individual workers, to the quality and volume of production itself.

Furthermore, by encouraging all levels of manufacturers to integrate automated systems into production processes, the government is able to create a new, rapid-growth market for high-end industrial robots. Such opportunities will encourage global market-leaders like KUKA, ABB and Kawasaki to invest in joint ventures with local Chinese firms, further promoting the Chinese technological development, and further enriching the Chinese economy. Boosting the appeal of this market to foreign investors simultaneously reinvigorates the demand for low-cost, highly-qualified white-collar university graduates for translation, accounting and clerical work.

Where previously China was the “factory of the world”, supplying low-cost labor, cheap land and easy access to equally cheap resources; now, the country has developed into a major world power, with an ever-increasing domestic demand for high-end, high-quality and high-volume manufactured products. Similarly, the Chinese population itself is in the middle of an economic transition, demanding a higher quality of life than previously thought possible. Such a transition necessitates a similar revolution on the factory floor; and this, more than demographic changes, is what the South China shift to blue-collar robots represents.