Merseyside-based home textiles company Caldeira is creating 20 new jobs at its UK headquarters.
Speaking at an employment seminar organised by business club Downtown Liverpool, founder and managing director of the firm, Tony Caldeira, said he was bringing work “back home” from his factory in China.
He added, “People have to understand that China is still booming and even though it is starting to slow down, the economic growth rate over there is still at seven or eight per cent and that is leading to a lot of inflationary pressures.”
It is not just prices for raw materials that have gone up, but labour costs, commodities and food costs are all rising very quickly, Caldeira (pictured below) said.
“I believe that some of our customers are still looking for product that is made just in time, that is of high-quality and ultimately we think that Merseyside is a good place to do business and we want to do more business here.
“When Caldeira formed its Chinese joint venture in 2004, a production worker earned around 750 renminbi per month, which at the time was around £50. Now the same worker expects a salary of 2500 renminbi per month, which at today’s exchange rate is around £250.
“Chinese wage costs have increased by five times in sterling terms in the last eight years,” he explained.
Caldeira said that he hoped to take on around 50 staff in total over the coming months, because he plans to bring a lot more production back to the UK from China.
Chris Grayling, employment minister, was also on the panel and he admitted that there had been some debate about his decision to blame the eurozone for the tailing off in the labour market in the last few months.
“But if you go back four months, unemployment was coming down, youth unemployment was below 900,000 and suddenly it’s gone back up again.
“The only credible reason I can come up with is the crisis in business confidence as a result of the eurozone crisis,” he added.
Grayling said that many firms were holding back when it comes to recruitment because of the current economic climate.
By Kirsty Hewitt