Industry Analysis & Industry Trends
Until the mid-1990s, railway transportation was considered China's most important form of transportation. However, this gradually changed under China's economic reforms as road and air transportation experienced tremendous growth. In contrast, the railway system in China increased at a slower rate of around 1,000 kilometers of new track being laid annually. In terms of passenger numbers, railway transportation as a share of the total transportation system has decreased over the past decade.
However, China's railway system entered a period of growth in late 2008 as the government began to invest heavily in railway construction to both increase railway capacity and offset the adverse effects of the global financial crisis.... purchase to read more
Industry Report - Industry Investment Chapter
The requirement to provide its own infrastructure makes this industry capital intensive. The dedicated and often inflexible rolling stock associated with railway operations also contributes to the high capital level of the industry. In 2011, the labor to capital ratio is estimated at 1.8:1, which means for every $1 in capital expenditure, there is $1.80 spent on labor.
This capital intensity increased in the past decade with declining employment levels and lower total wages as a proportion of industry revenue. Employment reductions are mainly the result of internal reforms of China's overstaffed railway sector. In addition, widely used telecommunications systems and safe working facilities also restrained demand for additional employees... purchase to read more