It is not just in China’s export orientated manufacturing hub, the Pearl River Delta, that company bosses are leaving workers with unpaid wages. The global economic crisis is affecting all of China’s eastern provinces, and more and more bosses are responding by cutting and running.

In the city of Jiaxing, midway between Shanghai and Hangzhou, the local authorities exposed 45 companies whose representatives had fled this year leaving 3,744 workers with wage arrears of more than 11 million yuan. And in Zhejiang province as a whole, Xinhua reported on 17 November that in the first nine months of this year, 277 bosses fled leaving nearly 50 million yuan in unpaid wages, 6.5 million of which remains un-recovered.

On 21 October, the Shenzhen Labour Bureau exposed 30 companies whose bosses had skipped town leaving a wage bill of 12 million yuan. One Taiwanese boss left his 400 factory workers in Longgang district with over two million yuan in wage arrears.

The global economic crisis has thrown the problem of wage arrears into sharp relief; however it has been a major problem in China for the last decade. The most serious arrears have generally occurred in the construction industry but this year just about every industry, especially in the manufacturing sector, has been affected.

Local governments have responded with a series of measures, from exposing delinquent bosses in the media and charging the public security bureau with bringing them to justice on the one hand, to establishing “wage arrears insurance funds” (欠薪保障基金) on the other. In 2007, Shenzhen had 12 million yuan on account, and reportedly that figure has already been exceeded in the first nine months of this year.

However, given the surge in the number of delinquent companies, these contingency funds yet may prove insufficient to cover the mounting unpaid wage bill. The central government and All China Federation of Trade Unions may well have to step into the breach.