News Analysis: Foxconn suicides the tip of the iceberg

Willy Lam looks at what is behind the serial suicides of the Shenzhen branch of Taiwan-owned Foxconn Technology Group, one of the world’s largest makers of consumer electronics.

Since early this year, at least 12 Chinese workers at Foxconn’s Shenzhen factory – which manufactures iPhones and other gadgets for Apple, Nokia and Sony, killed or seriously maimed themselves while jumping off the premises.

A rash of strikes has also hit the China plants of Honda.

Owing to news censorship, at least a few dozen other cases of labour unrest affecting Chinese-owned factories have not been reported in the official media.

At first, Guangdong and Chinese authorities and media pinned the blame on “outdated” and even “inhuman” management methods of Foxconn and other foreign firms. The avalanche of labour incidents, however, has forced the authorities to admit that the China model of squeezing poorly-paid migrant workers in what the local media calls the “blood-and-tears factories” is at fault.

The recent crisis has erupted because today’s workers – the so-called post-1980s generation – are no longer prepared to put up with atrocious employment conditions.
Most of them come from one-child families, where they are used to being pampered by solicitous parents and grandparents.
Moreover, more and more “migrant workers,” who still hold rural residence permits, were born in the cities: unlike the first generation of labourers from impoverished rural provinces such as Sichuan and Hunan, up to 100 million urban-born migrant workers have never tasted the bitterness of the harsh countryside.

Also important are demographic changes.
The number of Chinese between the ages of 15 and 24 has stayed at the level of 200 million to 225 million for the past two decades. This number is likely to shrink by one-third in the next ten years or so, giving unprecedented bargaining power to young people now joining the workforce.

In a rare editorial late last month, the official Xinhua News Agency admitted that the much-praised China model of growth could be nearing its end.
“The [Foxconn] suicides have demonstrated the urgency of China changing its mode of economic development.”
An editorial at the influential Beijing-based Global Times paper focused on the special demands of factory hands born in the 1980s and 1990s.
“The post-1980s and post-1990s generation has become the main actors behind the ‘Made in China’ phenomenon,” Global Times said.
“Major changes have taken place in the structure of Chinese society. But are the members of the new generation ready? Is Chinese society ready? Are China’s enterprises ready [to adapt changes]? The suicides [at Foxconn] show that there is no way that we can be optimistic.”

There are signs that the administration under President Hu Jintao has become more aware of the time bomb ticking away.
In his Government Work Report to the National People’s Congress last March, Premier Wen Jiabao pledged that “the [economic] pie will be divvied up in a more equitable fashion.”
He also vowed to ensure that all Chinese “can live with dignity.”
President Hu indicated in his May Day address that workers should be able to engage in tianmianlaodong or “dignified work.”

Some solid steps have been taken to help Chinese who have trouble eking out a living. For example, the minimum wages of more than a dozen provinces and directly administered cities have been raised since the spring by up to 10 percent.
Minimum monthly wage levels in Shanghai, Guangdong and Zhejiang have breached the 1,000 yuan mark.

However, the salary increases have not kept pace with either rising costs of living or rising expectations.
In 1993, Guangzhou, capital of well-off Guangdong Province, became one of the earliest Chinese cities to have introduced the minimum wage. Since then, the wage level has increased 3.4 times from the initial 205 yuan to today’s 1,100 yuan. The average salary nationwide, however, rose by 6 times during this interim.
Moreover, while in 1993, the minimum wage was 50 percent of the average pay check, the ratio has now fallen to a mere 30 percent.

There is no denying that socio-economic polarization is becoming more severe. Just-released figures showed that in the past 22 years, the wages of Chinese workers as a percentage of GDP had slipped by 20 percent.

Another set of statistics indicates that the richest one percentage of families hold 41.4 percent of national wealth, making China one of the worst countries in terms of discrepancies between haves and have-nots.

Moreover, channels for members of disadvantaged sectors to air their grievances have become less, not more. Workers are still not permitted to form non-official trade unions. Collective bargaining and other labour lobbying mechanisms are disallowed.
Overall, regional and grassroots administrations have taken draconian steps to prevent apparent victims of social injustices from taking their petitions to top-level party and government departments in Beijing.
And in light of the politicization of the courts, citizens do not have high hopes of seeking redresses through the judicial system.

Unless the Hu-Wen team is willing to do something drastic to improve social justice, however, labour unrest can only get worse as more members of the pampered – and demanding – post-1990s generation enter the workforce.

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