Data on the role Taiwanese firms play in China's job market are thin, but Taiwanese investment is a major force in China's economy. According to economists at BBVA (pdf; see page 5), US$6.7 billion of China's foreign direct investment (FDI) last year came from Taiwan, compared with $3 billion from the US and $6.4 billion from Europe. An older estimate put the total stock of Taiwanese FDI in China at the end of 2008 at $130 to $150 billion (pdf, page 31). According to estimates from Taiwan's government there were about 70,000 Taiwanese firms in the mainland in 2009.

And the China Beige Book, a survey of more more than 2,000 heads of companies across China, found that the rate of hiring had slowed by 9% for the third quarter of this year. The number of companies cutting staff also rose from 13% of the sample to 20%, and 5% of firms reported strikes.

And manufacturers are looking elsewhere. "With basic salaries rising all over China, I know of many Taiwanese manufacturers who are starting to look at Vietnam, Cambodia and Indonesia," says George Wang, another trade show attendee who describes his company, JoyFly Technology, as a sales agent for several Taiwanese plastics companies.

Sway Su, another attendee and a researcher for Taiwan's Plastics Industry Development Center, a trade association, echoes that view. "Manufacturing wages in some wealthier cities in mainland China are the same as in Taiwan now. So Taiwanese manufacturers want to move their production to Indonesia, Vietnam, Cambodia or Thailand and are looking at how to make that work." The minimum wage in Vietnam's capital, Hanoi, is 2 million dong ($95) a month. By contrast, in China's cheapest province for manufacturing, Jiangxi, in the nation's poor interior, monthly wages are around $137.

So pricey has China become that even Taiwan is starting to look attractive again. Eric Chang, the marketing manager of a machinery manufacturer owned by a Taiwanese family and based in Guangzhou, southern China, says his company might move production back home. "Our country has a better educated workforce, and factory wages in Guangzhou are approaching those of Taiwan now."

It's not just about the wages, however. Taiwanese manufacturers are quick to point out that they do not mind paying Chinese workers higher wages. In fact, because of the continuing bad publicity about conditions at Hon Hai, where a spate of workers committed suicide in 2010, they are desperate to shrug off a reputation for mistreating Chinese workers. "If wages rise gradually when the world economy is good that is OK," says Chang. "If they keep rising quickly and suddenly when no-one is doing that well, businesses like ours cannot cope."

But there are other reasons to look farther afield. China began phasing out tax breaks for foreign investors back in 2008 and they are mostly gone. Vietnam, meanwhile, now offers a range of sweeteners. Wang, of JoyFly Technology, says he has just returned from a research trip to Vietnam, where he found that factory land in the south could be leased for 30% less than in China's Pearl River Delta, the export hub close to Hong Kong. "Of course, Vietnam's roads are nowhere near as good as China's and there are often power cuts," he admits.