China Labour Bulletin is quoted in the following article. Copyright remains with the original publisher.
By KEITH BRADSHER
Published: March 30, 2012
HONG KONG — The shorter workweeks and higher pay that Apple’s biggest contract manufacturer, Foxconn, has promised would mean fundamental changes to factory work in China — assuming enough workers can be found in the first place.
No worker is likely to oppose higher hourly pay, of course. But one reason that workweeks of 60 hours or more have been possible at factories run by Foxconn and others is that at least some laborers already on the payroll have wanted the extra hours.
Perhaps just as important: there is a growing shortage of blue-collar workers willing to work in China’s factories. This shortage is a big factor in the long shifts and workweeks manufacturers have used to meet production quotas. It has already been forcing wages higher in China’s industrial heartland.
That does not mean the work is not also grueling and sometimes even dangerous, as the Fair Labor Association said in a report on Foxconn it released on Thursday. But it could mean that even if Foxconn intends to carry out its promises, the Chinese labor market may not be able to respond quickly.
“This is an evolutionary process,” said Ricardo Ernst, professor of global logistics at the McDonough School of Business at Georgetown University. “The United States has a particular working environment in terms of shape and conditions, and you shouldn’t necessarily expect tomorrow morning to see the same working environment in Asia.”
Labor shortages are already so acute in many Chinese industrial zones that factories struggle to find enough people to operate their assembly lines. Factories often pay fees to agents who try to recruit workers arriving on long-haul buses and trains from distant provinces.
At midday this month in Guangzhou, the capital of the industrial Guandong province, about 100 workers stood outside the gray gates of the factory complex of one of Foxconn’s many rivals in consumer electronics, Liteon.
Behind them stood a couple of dozen agents hoping for fees from the factories for finding employees deemed acceptable. The agents’ fees can equal as much as a week’s wages for a worker, and they come out of the factory’s costs, not the workers’ pay. The workers themselves often receive signing bonuses as well, although these may only be a day’s pay.
So the added expense of hiring additional workers can make it cheaper to ask employees for extra overtime, even when the factories honor regulations requiring that workers be paid double time for overtime and triple wages for each hour worked on holidays.
But many workers also want long hours. The Fair Labor Association’s survey of Foxconn workers found that 48 percent said their hours were reasonable and another 34 percent said they actually wanted even more hours. Only 18 percent said their hours were too long.
In interviews with The New York Times over the last several years, workers at other factories in southeastern China have frequently said that they wanted long hours because they were young, had little to do during free time in their factory dormitories and were eager to make as much money as quickly as possible so as to return to their home villages.
When China imposed its current laws limiting overtime four years ago, the regulations set off considerable complaints from workers and companies alike. There is a limit of three hours a day of overtime and six days of work a week.
“The law is very restrictive about what it allows,” a foreign businessman in southeastern China said Friday. He insisted on anonymity lest his comments be construed as criticism of the government or of labor advocates. Labor laws in the United States are actually less restrictive, in some ways, in allowing workers to put in even longer hours than in China. Generally speaking, as long as American workers receive time and a half pay for anything over 40 hours a week, there are no limits on total hours.
China officially bans workers and factories from arranging longer hours even by mutual consent, for fear that employers will put inappropriate pressure on workers to put in extremely long hours.
The current Chinese law, which took effect in 2008, requires overtime pay for workers who put in more than eight hours in a day or more than 40 hours in a week.
The Fair Labor Association accused Foxconn and Apple of consistently violating the legal limits on hours. The companies now say they will ensure full compliance with regulatory maximums by the middle of next year. Geoffrey Crothall, a spokesman for China Labour Bulletin, a nonprofit group in Hong Kong seeking collective bargaining and other labor protections for workers in mainland China, said there was considerable variation among workers in China in the number of hours they wanted to work.
“If you talk to workers, you quickly understand some want to work a minimum number of hours and just get by, and others want to work a lot more and earn more,” he said on Friday night. “The point is, Foxconn doesn’t give them a voice in the matter.”
Apple and Foxconn said that they would protect workers’ wages while eliminating excessive overtime. With wages rising close to 15 percent a year in southeastern China, Foxconn may be able to do this without increasing pay at a much faster tempo than previously planned.
The minimum wage in Shenzhen, where Foxconn has the bulk of its 1.2 million employees, has gone from 635 renminbi a month in 2005 to 1,500 renminbi now.
The rise in wages has been even faster in dollar terms, because the renminbi’s value has been climbing gradually in currency markets. The minimum wage in 2005 was worth about $80 a month at the exchange rate then. Today’s minimum wage is worth about $240 a month.
Higher food prices have offset a small part of the increase, but rents have soared. That makes it costlier for workers to rent apartments, which can cost the equivalent of $30 a month for each bedroom, instead of living in dormitories. But more workers are moving out of dormitories and into apartments anyway as their wages rise.
Workers’ expectations have climbed even faster, though, as the Internet has made it easier for them to see images of how more affluent families live elsewhere in China and in other parts of the world.
Workers at Foxconn often earn nearly twice as much as the minimum wage. The company has raised wages to keep them above the legal minimums, but the higher pay at Foxconn also reflects heavy overtime, the Fair Labor Association report found.
Gao Qing, a 21-year-old from Zhengzhou in north-central China with a high school diploma but no further education, stood outside the Liteon gate waiting to be hired this month. She said that finding a minimum wage job was no problem — but she wished she could find something better.
“It’s hard to find a good job,” she said. “It’s easy to find just any job.”