Among China’s “Eleventh Five-Year Plan” and the “Twelfth Five-Year Plan,” both producer services and manufacturing are the main industries. Especially the interaction of them is the Spotlight of industrial research. It can be proved by experiences of producer services industry in many countries. In the development process, no matter manufacturing, agriculture or even the service industry, they have to improve efficiency of production, values added, industrial competitiveness, and reduce the production cost in order to achieve the industrial upgrading goal.
There are two common problems of manufacturing in China. One is their R&D funding shortage, and another is lack of senior professionals. Also, in the international industrial chain, China''s manufacturing industry is all about labor-intensive activities. Even though in the process of produced technical products, China’s manufacturing is only about assembly activities. Although manufacturing''s manufactured goods seize up to 94.55% of total exports of China up in 2008, China still is often boycotted in trade barrier because of low-cost advantage of manufactures export. In addition, land and labor cost of China are no longer dominant as it used to be. Moreover, industrial upgrading must be the first priority to focus on because the affects caused by high resources consumption and environmental pollutions.
However, is the interaction between producer services and manufacturing in China really similar to the theory or experiences in developed countries? By summarizing the literature, the input-output analysis, and the regression analysis, we found that is not the case. China’s manufacturing in the demand for services is still mainly based on traditional production services to meet demand. Which means, the aims to enhance value by enhancing China''s manufacturing industry R&D capabilities does not match expectations. Therefore, even China''s producer services and manufacturing industry are tally with the interaction theory, the two industries in China are still in a low level of interaction stage.