Booming China raises workers' hopes - and discontent

Low pay and poor conditions drove employees at two shoe plants in the Pearl River Delta to riot.

For laborers at the sprawling Selena shoe factory, tensions had brewed for months. The food was free but bad, and getting worse, with fewer meat dishes and too many mushy vegetables. For migrant workers manning an assembly line 11 hours a day, bad meals are a cause of anger.

Shoe orders were coming thick and fast, however, which gratified everyone. In the "factory of the world" - China's southern Guangdong Province, which exports everything from lawn furniture to baseball gloves - migrant laborers will switch factories if they don't get overtime.

Migrants work six days a week and live in fetid rooms with 15 people in order to save money. So the steady extra work brought anticipation among the 20,000 workers for a big pay day.

Yet on pay day, inexplicably, the pay didn't add up. Workers just exploded.

It takes a lot for Chinese laborers to strike, then riot. They know the rules. But at two shoe plants owned by Taiwan's Stella International, strikes led to a day and a half of riots, attended by beatings of workers from hired security squads. Workers trashed a cafeteria and computer room, and overturned the owner's car.

Eight migrants were arrested, went on trial last month, and now await a sentence. Last week outside the two plants where 6,000 laborers went briefly wild in April, tensions are still high. Only employee residents are allowed into or out the walled compound including the factory and dormitories - not even workers' friends are allowed in.

"Maybe it was against the rules but I was sympathetic with the protesters," says a four-year Stella veteran who has seen her pay grow by just $35 per year. "We [migrants] put a lot into this plant, but in the end we will get nothing. Only the pay. We are migrants and they can replace us. They don't care, we know that. But when we leave we need to have saved something for the future."

Greed and the Party blamed

Stella factories, by reputation, are not considered poor work places. By Delta standards, labor experts say, they are decent. Yet in what labor activists say was a historic defense of the Stella workers charged with "intentional destruction" of property (usually the trial is pro forma), Beijing lawyer Gao Zhisheng reversed the blame for the riot. Mr. Gao said the "greed" of the owners was "the real reason" for the incident, blamed the Communist Party for standing "shoulder to shoulder" with the capitalists, and said the root problem was the lack of workers' rights to voice their grievances.

Guangdong's economy, the engine of the Pearl River Delta, has grown at 15 to 20 percent for years. The blend of endless cheap labor from the countryside, a free-market ethos, and advanced power and transport infrastructure is the reason China averages $1 billion a week in foreign direct investment. Yet as cities like Dong Guan have mushroomed to 5 million residents from 40,000, and boast new skyscrapers and hotels and hundreds of newly purchased cars a day, migrant wages have risen microscopically.

But a decade into a manufacturing boom that wows the world, Chinese workers are also maturing; and their aspirations are expanding in a manner that implicitly challenges the cheap labor paradigm that makes up China's competitive advantage. A recent labor shortage in the Pearl River Delta may itself be partly due to worker unhappiness.

To be sure, migrants fresh from peasant villages are known to look agog at earnings like 500 to 900 yuan a month ($60 to $110) in the city. At home, they might make only 200 ($25). Yet during the peak of China's boom, over the past 12 years in the Delta, migrant wages have risen only 68 yuan or $8, according to State Council figures. Migrants are actually losing, not gaining, as urban living and food costs are rising, the figures show.

Moreover, as profit margins for exports slow worldwide, a clash may ensue between Chinese factory owners and workers who want better pay and protections. China has many laws covering labor wages and safety. But as labor expert Han Dong Fan points out, workers like those at Stella have no unions or formal means to complain about ill-treatment. He adds, "The laws are rarely enforced. The emphasis is on protecting owners, to ensure continued investment."

Today, migrants who have lived in the Delta for five years are no longer wet behind the ears. They watch TV, want to get married, want service-sector jobs, training, better skills, and promotions; they can afford to be choosier, know how to network, and have new options.

"Two things have changed in the past year or so," says Mr. Sung, a Korean supplier to Delta shoe factories. "Profit margins have narrowed. But also the eyes of the migrant workers have opened. They are smarter than before. They will ask questions now."

Officials acknowledge tension

Even some Chinese officials warn of a possible conflict if migrants don't get a better shake. "There will be problems if the workers' salaries stay the same while the national average rises," says former State Council researcher Wang Xiao Qiang. Chinese studies show this is exactly what is happening.

In late summer, Delta factories did have labor shortages, surprising for a country of 1.3 billion people. In the countryside roughly 80 percent of an estimated 800 million peasants have lowpaying jobs. Yet the number of factory workers is only temporarily down, sources say. Signs outside factory gates put up in June that invite workers are still out. Most ask for workers with middle school diplomas. Some foreign owners complain they can't find employees. Yet few experts believe China has a serious labor shortage. What it may have are periodic shortages of the most ideal workers: migrants who are skilled, female, and young.

"If we have a real shortage, we know people who can pick up the phone and call the Labor Ministry in several provinces," says a Hong Kong-based chief executive officer. "We call Sichuan and say, we need a thousand people, and a week later we get a thousand. I don't take the 'shortage' too seriously."

The lack of enforceable regulations in many factories has created an ideal situation for owners, labor sources say - no unions, no watchdogs, no history of tough legal actions, no local free press (there has been no story of the Selena strike in any mainland media). In fact, as a new report by Human Rights in China points out, labor problems are often murky because much information on labor is classified as "secret." News of strikes and wage rates are labeled "highly secret."

A study this year, however, showed agreement among factory owners and government officials that "if labor laws are strictly enforced, the region will be less attractive to investors," as Chinese Academy of Social Sciences member Tan Shen found.

The defendants in the Selena strike case remain in prison. Gao, their lawyer, argues that to be convicted of criminal charges, the eight migrants must be shown to have had premeditated intent to riot - but all the testimony indicates the anger was spontaneous, breaking out in both plants on pay day. He also points out that none of the eight arrested, including his client, Chen Nanliu, did anything different than the other 6,000 rioters; to convict, they must be shown as more responsible than others.

"Traditionally, China is worried about its image in order to protect the party from looking tarnished or dirty," says Han Dong Fan of China Labor Bulletin in Hong Kong. "Now what you see are cases where it is not the party that is being protected from the voices of workers, but the bosses. To the workers, this is obvious."

Workers wanted - as long as they're female

In the noon sun, Mao Zhen fidgets outside the huge Selena shoe factory - waiting to submit a work application. A veteran migrant, Mr. Mao is confident about the assembly-line job, his neat appearance, and the wages he will accept - everything except his gender.

At a time when most factories in Guangdong have "help wanted" signs posted at their gates, Mao says what that really means is "female" workers wanted. He is holding a wad of 500 yuan ($60) for a requisite downpayment to Selena that is related solely to being male. Females applicants pay nothing to be hired.

"We are regarded as troublemakers more than females are," Mao says. "If we want a job, we have to put down a deposit."

In the Pearl River Delta, young female migrants are prized by management and owners, and easily out- compete males. There is a famous saying that women workers are "geng lao shir," or more quiet and quiescent.

Women make up some 68 percent of the roughly 20 million migrant workers in the Delta, and some experts say the current labor shortage is a female labor shortage - since women outnumber men in skilled trades like electronics, garments, and food processing.

Mr. Li, who owns a joint venture factory in Shenzen that makes cellphone parts, will hire only female workers. His long-employed technical staff is made up of five men. But the 40 assembly-line workers are women, seen as more careful and patient.

"The women don't make trouble," Li says. "You hire men, or a lot of men, and they want to run around. They aren't reliable. They will steal. They have that reputation."

In factory living, in the crowded worker's dormitories, men and women live separately.

Usually the men live 15 to 20 to a room, and they pay about $10 a month. Many married workers live separately in the big cities, even while working within a few miles or even blocks of each other.

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