With all the talk about low wages and exploited workers in Chinese factories, like Foxconn, it was great to see the New York Times publish an article talking about the realities of the labor market in China. With the boom in exports, the increased demand for labor, and the increasing shortage of blue collar workers, market forces have led to increase wages for Chinese workers, naturally. The article claims wages are increasing close to 15% annually, a number unheard of in the US, except for on Wall Street (though not this year). This did not require the outrage of American citizens for the Chinese government to intervene.
Several factors are at play in China. First, as with every developing country, as the economy and demand pick up, more and more self-employed artisans and farmers begin to move to urban areas and take on wage jobs at factories. Eventually, this supply of cheap labor dries up and the factories have to increase wages to convince workers to either move from the hinterlands or to work at their factory instead of the factory next door. The NY Times article describes some of the tactics factories are using including using agents who are like blue collar headhunters trying to recruit workers, as well as offering workers hiring bonuses. This sounds more like Wall Street than what American blue collar workers experience.
Secondly, like many American blue-collar workers in years past, Chinese workers often are looking to work more hours because they want the extra time and a half or double time, because they are ambitious and trying to raise their family out of poverty. Working more (for double the wage) is a great way to do this, so their children don’t have to. When I worked moving boxes in a warehouse, I eagerly anticipated getting some overtime in. Indeed, only 18% of workers said their hours were too long, according to the Fair Labor Association’s survey of Foxconn.
Lastly, the Chinese government, since 2008, has imposed restrictions on hours worked that is even more stringent than the US. In the US, as long as workers are paid overtime, there is no limit to the number of hours a worker can work past 40 hours. In China, you can only work an extra 3 hours a day and a maximum of 6 days a week. Moreover, even if both owner and worker agree to more hours, it is banned by law.
I ran into similar reactions from friends in the US when I told them I paid workers in Kenya 180 shillings per day (roughly $2.25). These workers (who were constructing a farmer planting kit for me) would otherwise be driving their bicycle taxi around town, where they may earn 130 shillings (less than $2) in a day. If I had offered even $5/day, there would have been fights and riots over getting that work.
This is all to say that it is important to view working conditions and wages in the context of where the work is occurring and not by our US standards.