It's Chinese New Year. Will workers get paid?
As travel season begins, the payment of back wages is an economic bellwether.
SHANGHAI — China is a country on the move - this month especially. The nation's trains, highways, and airplanes will handle an estimated 1.8 billion passenger trips over the next month as part of Spring Festival, a holiday of homecoming tied to the Chinese New Year.
For hundreds of thousands of Chinese migrant workers - the cogs of what has been dubbed "the world's factory" - Spring Festival is not just a rare opportunity for R&R, but a make-or-break payday. Employers often promise to pay by this holiday the back wages owed from months of toil so that workers can return to their families with the fruits of their labor from the year.
But this Spring Festival, payday probably won't come for many of these expectant workers, say labor-rights activists. And some of those who do get their money may take it to purchase a one-way ticket home, adding to a labor shortage fueled partly by poor working conditions. All this makes the Spring Festival a bellwether for those watching China's economy.
The withholding of back pay - which is illegal - has become common practice in China, where an estimated 100 million migrants from rural interior provinces flood the wealthier south and east coasts, filling the factories and construction sites with cheap labor. The Chinese government last year estimated that workers were owed around $12 billion in unpaid wages. Employers withhold pay as a means of keeping laborers in a job.
The Spring Festival travel season began last week, and the official days off this year run from Feb. 7 to 11. Already, the Chinese media is rife with accounts of workers unable to return to their families because their bosses have not and will not pay them. Other reports show the situation is improving, with more workers collecting the pay owed them so they can return home.
Stephen Frost, a researcher at the City University of Hong Kong who studies Asian labor issues, pointed as one example to publicly staged suicide threats by unpaid workers in southern China.
"That's the kind of desperation people are in," says Mr. Frost, who noted workers in the construction sector often are particularly hard-hit on back wages. "The work is tough and if you don't get your money, it's terrible."
In Shenzhen, Liu Kaiming runs a non-governmental organization called the Institute of Contemporary Observation dedicated to helping migrant workers.
"Many people cannot get their salaries," he says. "I cannot say if this year is better or worse, but the working conditions are getting better."
With the increasing profile of labor unions and strikes in China, along with government pressure to stop illegal wage withholding, the situation is likely to improve, says Liu. Many factories in southern China are also short on labor, creating pressure to improve work conditions and pay.
A report from the Chinese Ministry of Labor and Social Security last fall found that millions of migrant workers chose to stay home and subsist on little money, rather than meander through the uncertainty of pay and poor conditions at factories. The shift created what the government said was a shortage of more than 1 million workers in the Pearl River Delta.
Frost says the end of Spring Festival this year could show whether the labor shortage was an anomaly. Manufacturers and others who depend on migrant workers should know at the end of the holiday whether their work force is returning.
The country's two other major worker holidays are the "Golden Weeks" that fall May 1 and Oct. 1. Late in 2004, the central government proposed eliminating the weeks and replacing them with flexible, paid holidays. The move fell through without explanation, however, and Golden Weeks were scheduled for 2005.
Lately, however, most companies and government agencies require working weekends at both ends of each week, leaving the net sum of an extra day off.