As labor shortages in coastal areas of China in 2011 are expected to be even more serious than in previous years, sources from notebook makers said that they will not rule out the possibility of sending workers to support upstream component partners, who are expected to suffer the most impact from any shortages.

Since hiring employees in coastal areas is becoming more difficult, while IT companies' new plants in western China will also join the recruiting process, the demand for labor is expected to significantly surpass supply.

Commenting on the issue, first-tier notebook maker Quanta Computer pointed out that labor shortages have already become routine each year, and the company is monitoring the problem closely. Since Quanta has a high degree of automation, the company said it does not have big concerns.

Fellow maker Compal Electronics said labor shortage exist, but the company has already established new plants in Chengdu, China to avoid the risk; meanwhile, the company's plants in Kunshan will continue to offer good compensation packages to attract talent.

However, both Quanta and Compal did not directly confirm they are considering sending support to upstream partners, but pointed out they will make arrangements after evaluating the market situation.

Downstream notebook makers and upstream component makers have already reached agreements to shift forward some component orders for the first quarter of 2011 to the fourth quarter of 2010 to minimize the impact from labor shortages.

For the first quarter of 2011, Quanta expects its notebook shipments to drop on quarter, and Compal expects to see a drop of less than 5% sequentially.