Upsurge of strikes in southern China
Wednesday, 30 November 2011.
Pay cuts, increased pressure and threat of relocation trigger a new wave of labour unrest
“Labour issues are explosive,” admitted factory owner Willie Fung Wai-yiu after a five-day strike by his largely female workforce.
The strike at Top Form International Holdings factory in Shenzhen was reportedly sparked by a Cantonese-speaking production manager who told a Sichuanese migrant worker to “jump off a roof and go to hell”. Instead, two-thirds of the 800-strong labour force marched off the job, crippling production at the factory which manufactures lingerie for brands such as Vanity Fair, Warnaco, Komar Intimates and Wacoal. The above-mentioned incident acted as a trigger, but the women’s action arose from long standing grievances over low wages and unreachable production quotas.
At the time of writing, most of the migrant workforce had returned to work, but some were holding out. The company met some of the workers’ demands but also announced that “three troublemakers” had been dismissed – almost certainly in an act of victimisation for the strike.
This was just one of many recent strikes in the gigantic manufacturing region of the Pearl River Delta in Guangdong province, where more than 20 million migrant factory workers produce around a third of China’s exports. Workers are being squeezed as companies shift production to hinterland provinces or cheaper labour economies such as Cambodia, Vietnam and Indonesia. Bosses are also on a cost-cutting offensive due to an export slowdown especially from the European Union, China’s largest market. The southern province’s exports dropped 9 per cent in October from the previous month.
As the Financial Times (23 November) noted, “China is facing its worst wave of labour unrest since a series of wildcat strikes at Japanese-owned car plants last year, as declining export orders force factories to reduce worker pay.”
Strike continues inside factory
Once again, the world’s largest non-unionised workforce finds itself pitted against riot police, foreign bosses, and intense pressure from the one-party state to resume work in the name of ‘stability’.
Thousands of workers at a massive shoe factory in Dongguan staged a strike and street protests, continuing their refusal to work despite being forced back to the factory by police and security guards.
On 17 November, 8,000 workers at the Yucheng Footwear factory went on strike and marched to the local government office to protest the loss of overtime and other austerity measures including restrictions on toilet visits. Ten workers were injured during a confrontation with riot police, according to Ming Pao Daily. The strike followed the sacking of 18 middle managers and rumours the plant would relocate to Jiangxi province, where wages are much lower.
Basic wage rates for migrant factory workers even in Dongguan and the wider Pearl River Delta are very low, necessitating long hours of overtime to make up a living wage. The minimum monthly wage in Donnguan was raised to 1,100 yuan in January, while in Shenzhen the figure is 1,320 yuan, the highest in China. The basic salary in an electronics factory is around 1,500 yuan a month, but with long hours of overtime, workers can get about 2,500.
“We were forced to return to the factory,” one worker told the Financial Times. “But we just sit there. No one is operating machines.”
The local government had taken a tough stance during negotiations and sided with the management, this worker told the Financial Times.
CNN quoted another worker at the plant: “The slow-down strike is still on [after five days] but there’s no street protest because the police have been mobilised.”
“They will have more strikes”
Earlier in the same week, 1,000 workers took strike action in nearby Shenzhen at a factory making computer keyboards for leading brands such as Apple and IBM. Workers at Jing Mold Electronics Technology said they were being forced to work excessive amounts of overtime on weekdays so the company could avoid its legal requirement to pay overtime on Saturdays. “The company acquiesced after three days,” reported the Los Angeles Times (28 November 2011).
“People had to work so late, they couldn’t concentrate any longer,” said Zhao Xiaobing, 38, a former employee. “They will have more strikes.”
Two other strikes took place in October – one at watchmaker Citizen Holdings in Shenzhen and one at a Dongguan furniture factory where workers were left unpaid after their boss absconded.
Factory output falling
Unlike the strikes last summer, most recent strikes have been defensive in character – brought on by management cost cutting and the threat of job losses. Last year’s wave of strikes especially in the motor industry saw some significant concessions at least over pay and conditions, while not realising the workers’ central demand for grassroots unions independent of the dictatorship-controlled ACFTU. The main trend today is one of reduced overtime or attacks on bonuses and other ‘extras’ that workers depend on to supplement low pay.
“When orders and profits decline and costs of business increase for manufacturers... their first instinct is to pass those costs on to the workers,” said Geoffrey Crothall of China Labour Bulletin. “Also many businesses in the Pearl River Delta are planning to relocate inland and this is creating uncertainty and anxiety among the workforce,” said Crothall.
China’s economic engine is visibly running out of gas. The official PMI (purchasing managers’ index) released by the China Federation of Logistics and Purchasing (CFLP) fell to 49 in November from October’s 50.4, indicating that manufacturing activity shrank in November for the first time in nearly three years.
The economy grew 9.1 percent last quarter from a year ago, the lowest since 2009, but a more pronounced slowdown seems to be in the offing. Deepening global economic turmoil is taking its toll along with a host of ‘home-grown’ economic problems such as the government’s credit squeeze. Several major banks have this week cut their forecasts for GDP growth next year, with Citigroup and Morgan Stanley now tipping 8.4 percent. For China, this would be the weakest growth in a decade.
“Compared with last year’s 10.4 percent growth such a slowdown would feel like a recession to many ordinary Chinese,” commented the South China Morning Post (30 November 2011).
With inflation still at 5.5 percent officially, and more than double this in reality, the government faces a tough call over whether to resume stimulus policies and risk a new surge of inflation, with the risk of more labour conflicts and ‘instability’, or maintain its monetary tightening measures and risk a sharp economic slowdown.
As these economic storm clouds gather, the struggle for worker-controlled unions and factory committees has become urgent. Socialists and labour activists around the world should step up solidarity actions with Chinese workers to stamp out sweatshop conditions and win full democratic rights.
China: Strikes spread amid economic slowdown Wednesday, 7 December 2011. Women workers at Hi-P international in Shanghai continue their strike against layoffs for 8th day
Vincent Kolo, chinaworker.info
Around 400 workers at Singapore-owned Hi-P International, an electronics manufacturer, are continuing their strike in the Pudong district of Shanghai. With negotiations hitting a wall, police have taken a tough line against the strikers. A dozen strikers were arrested yesterday (6 December) and workers have complained of police beatings earlier in the dispute, which has now lasted for eight days.
The company, which makes components for companies such as Apple, HP, Blackberry (RIM) and Motorola, is relocating the factory to a remote suburb of the city. Many among the predominantly female workforce do not want to move and are demanding their legal right to compensation from the company.
“We work long shifts, sometimes over 20 hours. Even with a company shuttle bus, the new factory will mean an hour and a half’s travelling every day, so we won’t have any time left to rest,” said one migrant worker from Sichuan.
“Most of us have been working at this factory for many years, so we should be properly compensated if they want to break our contracts,” she told the South China Morning Post.
“They are moving the factory but I don’t want to go there,” a worker surnamed Zhang told Reuters. “Now they just don’t want to compensate us. They do not want to even give us a single cent.”
“We want the truth”
The entrance to the factory in the Jinqiao industrial zone of eastern Shanghai has been blocked for several days by striking workers with banners reading, “We want an explanation, we want the truth.” In a country where strikes and union organisation are outlawed, the women’s struggle and ability to sustain this action for so many days is very impressive. The same factory was hit by a two-week strike in July and August in protest over plans to shift some production to Suzhou in Jiangsu province.
Strikers are refusing to sign agreements on the company’s terms, under which no compensation is to be given, in violation of China’s labour laws. Workers said the company planned to hire new staff. Dozens of police officers have been stationed outside the factory and workers said police had beaten up some strikers last Wednesday (30 November).
“This hurts me so much. I have worked hard for them. They are contravening labour law by asking us to leave but not pay us any compensation. Why are the authorities siding with them?” said another striker.
The company, evidently with backing from the local government, has taken a hard line stance to try to break the strike. On Tuesday 6 December, when workers arrived for picket duty at 6am, the factory gates were surrounded by around 200 police officers, who ordered the women to keep away. Police seized around a dozen strikers when they attempted to stage a sit-in in the street outside. At the same time the company issued an ultimatum that those workers who have not returned to work within three days will be dismissed.
Hi-P International employs more than 20,000 employees worldwide at 15 manufacturing plants. This includes five factories in China – Shanghai, Chengdu, Tianjin, Xiamen and Suzhou. The company also has plants in Mexico, Poland, Singapore and Thailand.
Rising tide of workers’ struggles
China has experienced a growing number of strikes recently as factory orders fall, export markets wilt, and bosses seek various ways to cut labour costs – increasing cafeteria prices and dormitory fees, withholding wages, and also increasingly shifting production from the manufacturing heartlands of coastal China to provinces with lower wages or to neighbouring countries.
Tens of thousands of factory workers in southern Guangdong province employed in the footwear, garment, watchmaking, furniture and electronics industries have taken strike action in recent weeks. Public and municipal sector workers have also taken strike action in Nanjing (public sanitation workers) and Shanghai (public hospital staff). In the Sichuan capital, Chengdu, several hundred state-owned enterprise (SOE) workers staged a three-day (28-30 November) sit-in protest over a share distribution plan following privatisation of the factory.
Around 100 staff blocked and barricaded a supermarket owned by British chain Tesco in the Zhejiang city of Jinhua. The store is to close and workers are fighting for unpaid wages. Bus drivers and taxi drivers have been involved in separate stoppages over low pay and unfair competition in Shandong, Hainan and Guangxi provinces.
Some recent strikes “showed a new level of sophistication” according to Geoffrey Crothall, a commentator for the Hong Kong-based China Labour Bulletin. A good example of this is the coordinated one-day strike by several thousand workers at five of PepsiCo’s 24 plants. The workers – at factories in Chongqing, Chengdu, Fuzhou, Lanzhou and Nanchang – protested last month at PepsiCo’s decision to sell its China arm to Taiwanese-owned Tingyi, fearing that existing terms and conditions of work will be undermined by the deal.
PepsiCo workers made use of weibo micro-blogging sites to publicise their dispute, again underlining a high degree of planning and coordination, which is sorely needed in the struggle for workers’ rights in China. So afraid were the authorities of this example, that ‘Pepsi’ was added to the list of blocked words on internet search engines.
Police and local government officials have generally taken a tough line towards recent disputes, as in the case of the Hi-P strike in Shanghai. Ten workers at the huge Yucheng shoe factory in Dongguan were injured when police cracked down on a protest march involving thousands last month The recent upturn in strikes has sounded alarm bells within the summits of the ‘communist’ dictatorship. Zhou Yongkang, China’s top security official, warned earlier this week about the spectre of social unrest arising due to the state of the economy.
“Especially when facing the negative effects of the market economy, we still have not formed a complete mechanism for social management,” Zhou said. How to do so, he said, “is the great and urgent task before us.”
The current labour unrest is set against a very different global economic backdrop to last year’s strikes, with a slowing economy in China and credit squeeze beginning to bite on company profits. Factory output is actually falling, with the November purchasing manager index (PMI) reading 49 (a reading below 50 points signifies a contraction).
Although inflation is still the major talking point – even on picket lines – most recent strikes have been defensive in character. Rather than fighting for pay increases workers have been responding to attacks from the employers’ side: layoffs, relocation, pay cuts, or privatisation. Workers face even bigger threats in the year ahead.
The Federation of Hong Kong Industries, representing Hong Kong manufacturing capitalists, recently warned that up to a third of 50,000 Hong Kong-owned factories in adjoining Guangdong and elsewhere in China could downsize or close by the end of the year, threatening hundreds of thousands of jobs for migrant workers.
As one striker at the Yucheng factory in Dongguan exclaimed, “Even during the financial crisis we didn’t see pressure like this.”
With companies looking to slash costs or cut production, cases of wage arrears and of absconding bosses are likely to spiral. A recent survey by an NGO affiliated with Peking University showed that 41.2 percent of construction workers (nearly all are migrants) have at some point suffered wage delays, sometimes indefinitely. These problems could get even worse in coming months, experts are predicting. The survey found that 75 percent of construction workers in Beijing do not have job contracts. With government curbs beginning to take effect and housing sales plummeting (house prices fell 15 percent in some areas last month), many construction projects are already being abandoned – along with their workforce!
Chinaworker.info is stepping up its campaigning work in defence of Chinese workers’ rights. The deepening global capitalist crisis will mean new shocks and challenges for Chinese workers.
We call for the release of all those Hi-P strikers detained by police in Shanghai and protest against this and other recent cases of harsh repression against workers who are fighting for their rights. Likewise we protest at Hi-P’s blatant strike-breaking methods and the role of the local authorities in aiding these anti-worker tactics. Workers need organisation and solidarity – free trade unions – to defend their rights against the bosses and the authoritarian state.
Even with a solid strike in one workplace, there is a need for organisational links and support from other workplaces. This of course is something the Chinese dictatorship wants to prevent at all costs. There’s an urgent need for real grassroots-controlled unions, independent of the state and employers, linked together across cities and regions. This is shown by the struggles at Hi-P (where solidarity action from other factories such as the Hi-P plant at Suzhou is needed) and in the promising example of PepsiCo workers.
The state-run ACFTU has shown again in current disputes that it is as an agent of the bosses and the government. International solidarity is needed, as in the brilliant example of ‘occupy’ activists in US cities such as Chicago, who on ‘Black Friday’ last month staged demonstrations in support of striking Chinese workers.
chinaworker.info demands the immediate release of arrested Hi-P strikers
Sit-in strike by Hitachi workers in Shenzhen Saturday, 10 December 2011. Thousands of electronics workers strike to demand job guarantees and compensation
Over 2,000 workers at a Japanese hard-disk factory in Shenzhen, southern China, have been on strike since Sunday over severance pay. The strikers have staged a sit-in to block the entrance of Hailiang Storage Products Co, a subsidiary of Hitachi, accusing Japanese bosses of bullying Chinese workers.
Hitachi is selling its stake in the Shenzhen subsidiary to US-based Western Digital Corp. The deal fails to stipulate workers’ compensation and workers fear they will be treated as new employees when the American bosses take over.
Radio Free Asia quoted a worker representative as saying a Japanese manager told the workers that the amount of time they worked at the company will be discounted, wiping out their severance pay altogether.
Throughout this week hundreds of workers have staged a sit-in outside the factory, holding banners demanding compensation and calling the company’s decision to dispense with severance pay “shameful.”
A Japanese manager reportedly visited the factory on Monday but failed to persuade strikers to return to work.
Sit-in at factory gates
The company has around 4,500 workers and technicians, none of whom have worked since Sunday night. More than 2,000 of the employees have been involved in the sit-in,” said a spokesperson for the workers.
Workers also blocked the company’s warehouse to stop products from being shipped from the site. Western Digital’s takeover of the plant is set to completed by March next year.
We don’t know whether the new company will fire us or not. We also don’t know whether the new company will treat us as fresh employees,” Xu said, adding labourers had asked for a settlement allowance. “We are asking for compensation, as many of us have worked for years for Hailiang Storage.”
The workers are also disputing payments for overtime work, which led to an earlier strike at Hailiang in 2007.
A technician who has worked for Hailiang for twelve years said his monthly salary had shrunk from 4,000 yuan to just over 3,000 yuan today.
Strike wave of 2011
The Hailiang strike is the latest example of a strike wave sweeping China’s major exporting regions such as Guangdong, Zhejiang, Shanghai and Jiangsu. Recent strikes have been in response to pay cuts, layoffs or relocation to countries and provinces with cheaper labour. The volatile global economic situation and crisis in export markets such as the European Union, has increased the pressures on Chinese factory workers, the majority of whom are migrants with precarious terms and work conditions.
In many cases, the new wave of Chinese strikers are no longer ‘beginners’ but have taken part in earlier strikes. Workers’ tactics are evolving – with sit-in strikes and attempts to block the removal of equipment by bosses. Informal organisation, discussions over tactics, and election of representatives, is undoubtedly playing a much bigger role today than in earlier labour disputes. This is a nightmare for the ruling one-party dictatorship, which fears the emergence of an independent workers’ movement and genuine trade unions more than anything else.