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Special Report: China’s Labor Struggles
Understanding the Chinese workforce that supports the
subcontractor industry
By Andreas
Limbert, Bishop & Associates Inc.
In
the connector and cable assembly world, global contract
manufacturers play a key role. Today, the largest facilities are
located in China. In recent months a few of these manufacturers
drew media attention after several of their workers jumped to
their death from factory buildings. Consumer and buyers may
question whether it is ethical for the consumer to buy products
assembled in such factories.
Living in China and working in this industry has given me
insights into the situation. I would like to share with you my
opinion and assessment, to help us understand why such tragedies
may have happened.
The first question is, what brings someone to such a desperate
act? Are the companies and their working conditions to blame?
The media suggests that these manufacturers are responsible for
the tragedies. However, a careful analysis shows that these
suicides are indicators of a far broader problem and challenge
to China.
Today, suicide is the second most common cause of death among
China's youth and young adults, after traffic accidents. In
comparison, suicide is the third most common cause of death in
the United States, after traffic accidents and homicide.
Statistics from the
World Health Organization (2009) show a significantly higher
suicide rate in China, with 28 out of 100,000 people, compared
to 13 in the U.K. and 22 in the U.S., per year.
At first glance, the high suicide rate is difficult to
understand, since China has developed, changed, and dramatically
improved their working and living conditions in just the past 15
years. Living standards for so many in China have become
exceptionally better, compared with common standard of the
recent past. What then are the challenges and burdens which
makes life desperately difficult and, in some instances,
unbearable for some young Chinese people? A number of critical
factors are involved:
Change of Social Networks
 The
dramatic progress of the economy has taken place primarily
within the coastal provinces of China, particular in Guangdong,
next to Hong Kong/Shenzhen; the wider Yangtze delta around
Shanghai; and the wider Beijing area. In the provinces along the
China Sea coastline, factory jobs offer a much higher income
than could be earned in the rural hinterland provinces. This
fact results in worker migration away from their home provinces.
Generally, young workers leave home, family, and their social
network of friends to travel far distances for better job
opportunities. These trips may take a few days on bus or rail,
as air travel is unaffordable for them. When the new workers
arrive, alone in the unfamiliar world of a mega-city, some of
them are not able to quickly make friends, and tend to become
very lonely and potentially depressed. Going back home is not an
option. Home is too far away for a weekend trip. The journey is
only feasible once a year, during the lunar New Year holidays.
Change of Formative Years Upbringing
The young workers currently entering the job market
are from the first generation born under the restrictions of the
one-child policy. Through this policy, the government intended
to limit the country’s population growth. Growing up as an only
child, and having all of the attention of the parents and
grandparents, had a strong impact on their life skills. This
generation often expects others to handle their problems. The
traditional Chinese old strength of character and ability to
endure tough and difficult situations has weakened. Isolation
from family and friends can lead to apathy, loneliness, and
melancholy.
 Difficult
Living Conditions
Moving into expensive, extremely densely populated
mega-cities forces migrant workers to live in factory
dormitories. This can be very challenging, as these dorms offer
no privacy or space, and they are usually very sparsely
equipped. Workers might share a room with up to 10 people. An
additional burden is that the workers have to spend not only
their workdays together, but also their time off. Huge
factories, with up to 300,000 employees, can give the workers
the feeling of being an anonymous body. They feel like just
another statistic in a nameless assembly line of factory workers
where nobody cares about them.
 Work
Conditions
In such large factories, the accepted authoritarian
management style can create a relationship of fear and
dependency between the workers and their supervisor.
In the past, employees had to work up to 13 hours a day. In
recent years, new government regulations have implemented
limitations, which allow employees to work only 36 hours of
overtime per month. Only in the past few years, these overtime
rules have been more strictly enforced. In the recent past it
was not uncommon for a worker to perform another 80 hours of
overtime in a month, creating further stress and fatigue.
Contrary to what you may think, small companies may have harsher
work conditions than larger ones, as the large companies are
more closely monitored by the government through the labor
bureau. This also applies to those companies that have been
mentioned in the media. These companies, in particular, are
concerned about their image and reputation and do not want any
“bad press” to tarnish this image.
Social Injustice
Today the wealth difference between the rich,
including the upper middle class, and workers, is
incomprehensibly large. While the rich and the upper middle
class enjoy a life style similar if not identical to their peers
in the U.S. and Europe, worker incomes have seen almost no
changes. Today, the minimum income for a factory worker,
depending on the Province of China, is as low as 920 RMB
(US$135) per month. To increase this salary, the workers are
expected to work overtime.
Even if you consider that the dormitory and canteen meals are
usually provided for free, incomes remain very low, hardly
allowing the workers any comforts. Goods such as mobile phones,
TVs, jewelry, new clothing, and shoes are barely affordable.
Cars or apartments are completely out of reach. The reason that
this situation does not initiate an outcry is that people living
in the countryside have even lower incomes.
Since living in the city is becoming even more difficult on such
low salaries, in 2009 the central government enacted a new labor
law, which significantly protects the interest of employees. In
late July 2010, a draft of a more stringent law was proposed
with the purpose of establishing a legally binding wage
negotiation mechanism and to improve the welfare of workers. The
new regulation will require companies to fulfill their social
responsibility, pay attention to the mental and physical health
of their workers, and improve their cultural and spiritual life
on the factory campus. However, the global economic crisis has
currently put the implementation on hold.
To summarize, I believe the reasons behind China’s workplace
tragedies are not just the low wages paid to these migrant
workers or the harsh working conditions, but a combination of
many factors; the result of the rapid speed of social change in
China; the intense competition for financial success; the
breakdown of traditional family structures; the more fragile
coping skills of children from one-child families; and China’s
dramatic rural-to-urban migration. A combination of these
factors are connected to a corresponding rise in psychological
stress, mental illness, and in unfortunate cases, suicides.
China’s society is becoming aware of these issues and is working
on ways to address them. The recent labor law revisions, the
increased social welfare of the factory worker’s living
conditions, and China’s desire to polish their world image are
helping to improve the basic situation. Let’s just hope these
changes move at a pace fast enough to avoid any further
tragedies.
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Andreas Limbert
Managing Director, Asia Pacific-Hong Kong, Bishop & Associates
Inc.
Andreas Limbert has held key management positions and worked on
diverse engineering projects throughout Europe, the Middle East,
and Asia for more than 20 years. He has helped lead numerous
team projects and international companies to financial success.
Limbert’s expertise in China includes a China-based sales and
manufacturing structure he established and managed for Thyssen
Elevators, the fourth-largest elevator manufacturer in the
world. He also established and managed a Asia Pacific regional
sales, service, and manufacturing organization for connector
manufacturer HARTING KGaA.
Since 2004, Limbert has been a management consultant with
FaberConsult, which helps
global
companies establish and perform
operations in Asia, particularly in China. In this
capacity, he also represents Bishop & Associate Inc.
Limbert has a post-graduate engineering degree in mechanical
engineering from the Technische Hochschule of Karlsruhe in
Germany.
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