China's labour market
The next China
As the supply of migrant labour dwindles, the workshop of the world is
embarking on a migration of its own
Jul 29th 2010 | CHONGQING AND FOSHAN
THE angrier they become, the less intimidating they seem. The strikes, stoppages and suicides
that have afflicted foreign factories on China’s coast in recent months have shaken the popular
image of the country’s workers as docile, diligent and dirt cheap. America’s biggest labour
federation, the AFL-CIO, blames imports from China for displacing millions of Americans from
their jobs. But in June its president applauded the “courageous young auto workers” who waged a
successful strike at a Honda plant in Foshan demanding higher wages.
While foreign unions cheer, multinational companies fret. According to UNCTAD, foreigners have
invested almost $500 billion in China’s capital stock. Their affiliates employ about 16m people in
the country. For a decade this combination has dominated global manufacturing growth,
dispatching ever cheaper goods from China’s ports. Of China’s 200 biggest exporters last year,
153 were firms with a foreign stake. But the recent unrest has put Chinese labour at odds with
Firms may have to get used to bolshier workers. The number of young adults is set to shrink,
which is likely to make China’s factory boys and girls harder to please. But then, as the AFL-CIO
points out, China’s workers are due a pay rise: their share of national income has fallen in the past
two decades, contributing to China’s low rate of consumption. As pay goes up the country’s
domestic market will become more lucrative. Foreign firms that came for the workers will stay for
the shoppers. China will become more of a workshop for itself and less of one for the world.
The workers are revolting
Labour unrest in China is more common than you may think. The country’s courts handled more
than 280,000 labour disputes in 2008, according to
, an official magazine. It is
difficult to know if unrest is growing, but the government at least seems to think so. The same
source reports that disputes in the first half of 2009 were 30% higher than a year earlier.
Guangdong, a favourite province for foreign companies, suffered at least 36 strikes between May
25th and July 12th, according to
, a government newspaper.
As students of Karl Marx and of history, China’s party leaders will know that labour movements
can begin with economic grievances and end in political revolt. By concentrating people in one
place, Marx argued, factories turn a crowd of strangers into a “class”: conscious of its interests,
united with each other and against the boss. But workers in China’s coastal factories have hitherto
shown little class-consciousness. They migrated from all over the country, jumped from one plant
to another and retreated to their villages when times were bad.
Their new assertiveness may reflect a labour law introduced in January 2008, which gave workers