Archive for ‘Labour’

24/02/2013

* Migrant workers invited to prominent holiday gala

Xinhua: “Four migrant workers were invited to a high profile gala on Saturday evening, which was once mainly reserved for distinguished intellectuals.

Chinese leaders Xi Jinping, Li Keqiang, Zhang Dejiang, Yu Zhengsheng, Liu Yunshan, Wang Qishan and Zhang Gaoli were present at the event organized by the Communist Party of China (CPC) Central Committee to mark the upcoming Lantern Festival.

New guests to this year’s show also include representatives from different sectors and model workers.

Liu Yunshan hosted the gala and in his speech highlighted the contribution of intellectuals and ordinary workers to the country’s achievements and called for joint efforts from ordinary workers in all walks of life to contribute to the nation’s great rejuvenation.

China has 260 million migrant workers by 2012. They usually leave their hometown to seek employments in urban areas.

The Lantern Festival falls on Sunday this year and traditionally marks the end of the Spring Festival season.”

via Migrant workers invited to prominent holiday gala – Xinhua | English.news.cn.

04/02/2013

* China to help migrant workers in urbanization

China Daily: “Chinese authorities on Thursday underlined the need to help rural migrant workers become urban residents, calling it an important task for the country’s urbanization, according to its first policy document for 2013.

To promote urbanization, especially concerning migrant workers, China will put forward reforms of its household registration system, loosening requirements for obtaining residency permits in small and medium-sized cities and small townships, the document said.

The country also vowed more efforts in providing professional training for migrant workers, ensuring their social security and protecting their rights and interests, according to the document.

Migrant workers should enjoy equal rights and benefits in payments, education of their children, public health, housing and cultural services, the document said. It added that authorities will work to extend basic public services to all permanent residents in cities.

The central government also urged more serious attention be given to the left-behind population, namely children, women and old people in rural areas after their family members go to work in cities.

Local authorities at all levels as well as the public should guarantee the rights and safety of the left-behind population with support, help and care, said the document.

The first policy document, issued by the central committee of the Communist Party of China and the State Council every year, is dubbed the No 1 central document. This is the 10th consecutive year in which the document has focused on rural issues.

Chinese official data showed that the country’s migrant worker population amounted to 253 million by the end of 2011, among which 159 million were working away from their homes.”

via China to help migrant workers in urbanization |Economy |chinadaily.com.cn.

See also: https://chindia-alert.org/2012/12/17/testing-time-for-chinas-migrants-as-they-demand-access-to-education/

27/01/2013

* Grandparents without borders

Another aspect of the on-going migrant workers issue that needs resolving by the government soon – before it blows up in their faces.

China Daily: “Migrant grandparents who leave their homes to live in the cities and take care of their children’s children are a growing demographic. Liu Zhihua highlights changes they have to face in adapting to their new lifestyles.

Grandparents without borders

In villages across China, grandparents have set aside their dreams of retirement to raise children left behind by their reluctant parents, who migrate to the cities in pursuit of making more money than at home. At a totally different level up the economic pyramid, in urban households, grandparents are now migrating from their homes to take care of their grandchildren in cities hundreds and thousands of miles away – as families scatter across a rapidly transforming China. Their children need to work, and are reluctant to hire a full-time babysitter, either due to distrust of a stranger, preference for family, or financial restraints.

As a result, grandparents, especially grandmothers, shoulder the responsibility of being primary caregivers, when they could be at their leisure after retirement.

But it’s not always easy to adapt, especially at what may be a relatively advanced age.

While staying in Shanghai last year to take care of her pregnant daughter, and later, her newly born grandson, Deng Chengying, 55, felt as if she was in a prison.

Xiong Jiayi enjoys quality time with his grandmother. [Provided to China Daily]

The Jingzhou native of Hubei province doesn’t understand the Shanghai dialect, but in the community where the family lives, nearly all the elderly neighbors speak only Shanghai dialect.

Deng does have one frequent visitor, a friendly old woman who is an empty nester , but conversation is difficult because she speaks only the Shanghai dialect.

If it wasn’t for the traders in the morning market speaking Mandarin, Deng would have few opportunities to speak her native tongue with those in her community.

When her daughter and son-in-law go to work and the housework is finished, she generally stays in the apartment and plays online games.

“I’m so thrilled I just jump if I meet someone whose language I understand,” Deng once confided to her relatives at home in Jingzhou during a phone call.”

via Grandparents without borders |Society |chinadaily.com.cn.

See also: 

20/01/2013

* China’s workforce peak demographics

Well reasoned analysis that goes behind and beyond headline figures – as expected from the EIU.

EIU: “China’s working age population is set to peak in 2013, according to the Economist Intelligence Unit‘s latest demographic projections. However the impact of this milestone on the country’s economy will be different from the experience of other, predominantly rich countries that have already undergone the process. While ageing, the country’s urban workforce will continue to grow. It will also become much better educated.

China Ageing Population

In the developed world, ageing is most commonly associated with shrinking workforces relative to the rest of the population, giving rise to pension cuts, postponed retirement and higher taxes on the young. As an economy still in transition, China need not fret about such issues. For a start, China’s state pension system is far from generous and its coverage low. Rather, the country’s biggest fear is that of worsening labour shortages—a phenomenon that was first reported in the mid–2000s and was subsequently the subject of much attention in the national media. There are two good reasons why these fears are overblown.

Rural fuel

First, China is still in the midst of a massive urbanisation drive. When the working-age populations of Germany and Japan, the world’s largest ageing economies, began to shrink in 1999 and 1995 respectively, the process of massive rural-to-urban migration had already matured. The proportion of the population residing in urban areas, or the urbanisation rate, had more or less stabilised at 73% and 65% respectively.

In contrast, China’s urbanisation rate will only reach 55% this year and is likely to continue rising by around one percentage point (or 13m people) every year, according to our projections. China will only reach Japan’s level of urbanisation by 2022 and Germany’s by 2030. Thus, even though China’s working-age population will shrink overall, the urban working-age population will only peak in 2029 after reaching 695m—135m higher than it was in 2012.

The flip side of this trend is a shrinking rural population. However, China’s rural population has been diminishing for three decades without much adverse impact on agricultural output. That is because its countryside is overpopulated: there are too many farmers working too little land. Indeed, China has even managed to boost agricultural output over the years by investing in machinery and technology.

It is difficult to pinpoint exactly how many more workers the agricultural sector can afford to lose before a large impact on farm output is felt. However, most economists agree that another 100m or so is achievable. Coupled with the fact that the primary sector only accounts for 10% of GDP, it becomes clear that, when it comes to maintaining economic growth, the urban workforce is really the only one that matters.

From factories to classrooms

Second, China’s labour shortages have largely been misdiagnosed. Much ink has been spilt attributing the lack of young workers for unfilled factory vacancies to demographic factors. Yet the number of Chinese aged 16–24 increased from 196m to 210m between 2000 and 2010. The rise in urban areas is even greater. Where, then, did all the young workers go? The answer is simple: they went to school.

The proportion of junior secondary school graduates continuing on to senior secondary school surged from 51% to 88% between 2000 and 2010. At the same time, the proportion of Chinese aged 16–19 that were either employed or seeking employment (the labour participation rate) fell from 57% to 34%. The relationship is clear: rising enrolment rates at schools have played a major role in postponing entry to the workforce.

The surge in school enrolment implies that the supply of young workers entering the job market will not only remain stable as China passes its demographic turning point, but might even grow. Enrolment rates cannot rise forever, and all the would–be teenage workers that were absorbed by the schooling system over the past decade will enter the workforce sooner or later.

As China’s youth becomes better educated, the coming decade will witness the emergence of a two-tiered workforce. One tier will consist of graduates looking for office jobs. The other will remain the country’s “traditional” source of labour: relatively low–skilled rural migrants seeking work in factories and construction yards. The latter group will, however, have aged substantially, creating new challenges for managers and HR departments across the country.

China’s workforce challenge is thus twofold: policymakers need to ensure that there are enough white-collar jobs for graduates, while employers of low-skilled workers will need to come to grips with hiring and managing an older workforce. Failure to do so will have serious consequences. An educated class disillusioned by high unemployment is something China can ill afford at a time of rising social tensions. At the same time, an inability to replace young workers with older ones could spell the end of the golden age of China’s mighty manufacturing sector.

Yet, if the demographic transition is managed successfully, there will be just cause to celebrate. The Chinese economic miracle has pulled more than 200m people out of poverty over the past 30 years. In the last ten, it has allowed 60m children who would otherwise never have finished secondary school to do so. The next task will be to ensure that their studies have not been in vain.”

via Peak demographics.

17/01/2013

* China Loses Edge As Worlds Factory Floor

WSJ: “China is losing its competitive edge as a low-cost manufacturing base, new data suggest, with makers of everything from handbags to shirts to basic electronic components relocating to cheaper locales like Southeast Asia.

imageThe shift—illustrated in weakened foreign investment in China—has pluses and minuses for an economy key to global growth. Beijing wants to shift to higher-value production and to see incomes rise. But a de-emphasis on manufacturing puts pressure on leaders to make sure jobs are created in other sectors to keep the worlds No. 2 economy humming.

Total foreign direct investment flowing into China fell 3.7% in 2012 to $111.72 billion, the Ministry of Commerce said Wednesday, the first annual decline since the fallout from the global financial crisis in 2009.

Then, a 13% fall in foreign investment into China reflected dire conditions for business in the U.S. and Europe, and global risk aversion, which choked off capital flows. Economists say the drop in 2012 is partly cyclical, driven by slowing overall growth in China and Europe’s prolonged debt crisis.

But it also is the result of a long-term trend of rising wages and other costs that have made China less attractive, especially for basic manufacturing, economists say.

By contrast, foreign direct investment into Thailand grew by about 63% in 2012, and Indonesia investment was up 27% in the first nine months of last year.

Coronet SpA, an Italian maker of synthetic leather with production in the southern Chinese province of Guangdong, plans a new factory in Vietnam to take advantage of lower labor costs and to be closer to its customers in the shoe and handbag businesses, many of which have already moved there.

via China Loses Edge As Worlds Factory Floor – WSJ.com.

See also: https://chindia-alert.org/2012/12/07/apple-to-return-some-mac-production-to-u-s-in-2013/

07/01/2013

* Use of student interns highlights China labor shortage

Reuters: “In September, the largest factory in the northeastern Chinese coastal city of Yantai called on the local government with a problem – a shortage of 19,000 workers as the deadline on a big order approached.

Chinese college students majoring in textile work at a garment factory in Jiaxing, Zhejiang province, October 19, 2012. More and more factories in China move inland from higher-cost coastal manufacturing centers, labor is turning out to be neither as cheap nor abundant as many companies believed. As a result, many multinationals and their suppliers are corralling millions of teenage vocational students to work long hours doing assembly line jobs that might otherwise go unfilled - jobs that the students have no choice but to accept. Picture taken October 19, 2012. REUTERS/Stringer

Yantai officials came to the rescue, ordering vocational high schools to send students to the plant run by Foxconn Technology Group, a Taiwanese maker of smartphones, computers and gaming equipment.

As firms like Foxconn shift factories away from higher-cost centers in the Pearl River Delta in southern Guangdong province, they are discovering that workers in new locations across China are not as abundant as they had expected.

That has prompted multinationals and their suppliers to use millions of teenage students from vocational and technical schools on assembly lines. The schools teach a variety of trades and include mandatory work experience, which in practice means students must accept work assignments to graduate.

In any given year, at least 8 million vocational students man China’s assembly lines and workshops, according to Ministry of Education estimates – or one in eight Chinese aged 16 to 18. In 2010, the ministry ordered vocational schools to fill any shortages in the workforce. The minimum legal working age is 16.

Foxconn, the trading name of Hon Hai Precision Industry, employs 1.2 million workers across China. Nearly 3 percent are student interns.

The company “has a huge appetite for workers”, Wang Weihui, vice director of the Yantai Fushan Polytechnic School, told Reuters during a recent visit to the city.

“It tightens the labor market,” said Wang, whose school sends its students to work at Foxconn and other firms.

Local governments eager to please new investors lean on schools to meet any worker shortfall. That’s what Yantai, in Shandong province, did in September when Foxconn had trouble filling Christmas orders for Nintendo Co Ltd Wii game consoles.

“It has been easier to recruit workers in the Pearl River Delta than some inland locations,” Foxconn told Reuters in written comments in late December.

Some companies cite rising wages in southern China for the shift elsewhere. Wages are a growing component of manufacturing costs in China, making up to 30 percent of the total depending on the industry, according to the Boston Consulting Group.

Wages began to rise around 2006 as the migration of rural workers to Guangdong ebbed. China’s one-child policy, plus a jump in higher education enrollment, further depleted the number of new entrants to the workforce, forcing up wages.”

via Use of student interns highlights China labor shortage | Reuters.

06/01/2013

* Flextronics CEO Sees Hope for U.S. Tech Production

Yet another article on manufacturing moving back to Western countries. This is particularly where the cost of labour is a small fraction of the total cost of production – eg in high-tech products. 

WSJ: “The CEO of Flextronics International Ltd.,  a Singapore-based company that helped hundreds of firms move manufacturing of electronic parts and products to Asia, says it is getting “easier to justify” production in the U.S.

image

The difference in labor costs is narrowing and local officials in America have been giving more financial incentives to companies setting up plants in the U.S., Mike McNamara, chief executive of Flextronics, said in an interview Friday. Mr. McNamara said he could even imagine some smartphones being made in the U.S. eventually. But he cautioned that the return of manufacturing to the U.S. is likely to be a “slow and evolving process” rather than a flood. Many obstacles remain, including relatively high U.S. taxes, health-care expenses and regulatory costs, he said.

“In Asia, if I want to get something done, we just go and get it done,” he said. An Asian plant with 5,000 employees could be set up in 90 days, he said, but it takes much longer in the U.S., partly for regulatory reasons. Flextronics has plants in 30 countries, including the U.S.

Apple Inc.  raised hopes for a revival of U.S. manufacturing a month ago by announcing plans to build some Mac computers in the U.S. for the first time in about a decade. Flextronics says Apple is one of its customers, but Mr. McNamara declined to comment on whether his company could be involved in the Mac initiative. Apple declined to comment on exactly where and how those computers will be made.

In the first decade of this century, Mr. McNamara said, manufacturers flocked to low-wage countries. Over the next decade, he said, more are likely to adopt regional manufacturing strategies, making goods closer to where they are sold. That can reduce transport and inventory costs; it also allows companies to respond faster to changes in demand and more effectively protect technological secrets.

Asian plants typically have more flexibility to set up new production lines quickly, which is important for products with short life cycles like smartphones. Still, as products become more customized and companies try harder to keep rivals from copying technology, Mr. McNamara said, some phone makers who want to make products to order for local customers eventually may produce certain types of smartphones in the U.S.

Flextronics, founded in 1969 in Silicon Valley and incorporated in Singapore in 1990, provides design, logistics and manufacturing services for several hundred companies. Mr. McNamara said Flextronics is the world’s second-largest company in that business, after Hon Hai Precision Industry Co.,  known as Foxconn and based in Taiwan.”

via Flextronics CEO Sees Hope for U.S. Tech Production – WSJ.com.

See also: 

31/12/2012

* Reform plans published for migrants’ education

A good news item to end the year with – moves to embrace migrant workers rather than treat them as a short-term anomaly.

China Daily: “China’s Beijing and Shanghai cities and Guangdong Province on Sunday published plans to gradually allow migrant workers’ children to enter senior high schools and sit college entrance exams locally.

china_gaokao.jpg

They are the latest in a total of 13 provinces and municipalities to formulate plans to ensure that rural children who have followed their parents to cities can enjoy the same rights as their urban peers in education.

Beijing will allow migrant workers’ children to attend local vocational schools in 2013 and allow them to be matriculated by universities after graduating from the vocational programs in 2014, said a statement from the city’s commission of education.

The eastern metropolis of Shanghai took a step further, saying it will allow migrant children in the city to enter local senior high schools, vocational schools and sit college entrance exams (commonly known as gaokao) locally starting in 2014.

Guangdong, a manufacturing heartland in south China and a magnet for migrant workers, has asked its cities to start recruiting migrant workers’ children in local senior high schools in 2013.

The province will allow these children to sit gaokao and compete with local residents on an equal footing in college entrance starting in 2016, Luo Weiqi, head of the province’s education department, told Xinhua.

Luo said the restrictions would be relaxed gradually and “step by step” as the province must solve the conflict between its gigantic migrant population and a scarcity of education resources.

Migrant workers, whose children could be benefited by the new plans of the three regions, must have residential permits, stable jobs and incomes, and meet other local requirements, according to the plans.

China’s hukou, or household registration system, used to confine children to attending schools in their home provinces. A 2003 regulation amended this by allowing migrant workers’ children to receive the nine-year compulsory education in cities where their parents work.

But the country has in recent years faced mounting protests from its migrant workers, whose children under current policies had to either return to the countryside for further schooling or risk dropping out of school if they chose to stay with their parents in cities where the parents work.

Earlier this year, the Ministry of Education asked Chinese cities to formulate plans before the end of this year regarding the further education and gaokao of migrant workers’ children.

Official figures show that China has more than 250 million farmers-turned-workers living in cities. An estimated 20 million children have migrated with their parents to the cities, while more than 10 million are left behind in their rural hometowns.”

via Reform plans published for migrants’ education |Society |chinadaily.com.cn.

30/12/2012

* China tightens loophole on hiring temporary workers

Further labour reform is being implemented. This set will make China more progressive than many western countries!

Reuters: “China amended its labor law on Friday to ensure that workers hired through contracting agents are offered the same conditions as full employees, a move meant to tighten a loophole used by many employers to maintain flexible staffing.

A worker welds steel bars at a construction site for a new train station in Ningbo, Zhejiang province, December 6, 2012. REUTERS/China Daily

Contracting agencies have taken off since China implemented the Labor Contract Law in 2008, which stipulates employers must pay workers’ health insurance and social security benefits and makes firing very difficult.

“Hiring via labor contracting agents should be arranged only for temporary, supplementary and backup jobs,” the amendment reads, according to the Xinhua news agency. It takes effect on July 1, 2013.

Contracted laborers now make up about a third of the workforce at many Chinese and multinational factories, and in some cases account for well over half.

Some foreign representative offices, all news bureaus and most embassies are required to hire Chinese staff through employment agencies, rather than directly.

Under the amendment, “temporary” refers to durations of under six months, while supplementary workers would replace staff who are on maternity or vacation leave, Kan He, vice chairman of the legislative affairs commission of the National People’s Congress standing committee, said at a press conference to introduce the legislation.

The main point is that contracting through agencies should not become the main channel for employment, he said, acknowledging that the definition of backup might differ by industry.

“In order to prevent abuse, the regulations control the total numbers and the proportion of workers that can be contracted through agencies and companies cannot expand either number or proportion at whim,” Kan said.

“The majority of workers at a company should be under regular labor contracts.”

Although in theory contracted or dispatch workers are paid the same, with benefits supplied by the agencies who are legally their direct employers, in practice many contracted workers, especially in manufacturing industries and state-owned enterprises, do not enjoy benefits and are paid less.

Employment agencies have been set up by local governments and even by companies themselves to keep an arms-length relationship with workers. Workers who are underpaid, fired or suffer injury often find it very difficult to pursue compensation through agencies.

China would increase inspections for violations, Kan said, including the practice of chopping a longer contract into several contracts of shorter duration to maintain the appearance of “temporary” work.”

via China tightens loophole on hiring temporary workers | Reuters.

30/12/2012

* Signs of Changes Taking Hold in Electronics Factories in China

Labour reforms, urged by major western firms whose products are outsourced to China are beginning to be felt.  However, one aspect, that of reduced overtime, is not welcome by many workers who would rather earn more even at the cost of leisure and health.

NY Times: “One day last summer, Pu Xiaolan was halfway through a shift inspecting iPad cases when she received a beige wooden chair with white stripes and a high, sturdy back.

At first, Ms. Pu wondered if someone had made a mistake. But when her bosses walked by, they just nodded curtly. So Ms. Pu gently sat down and leaned back. Her body relaxed.

The rumors were true.

When Ms. Pu was hired at this Foxconn plant a year earlier, she received a short, green plastic stool that left her unsupported back so sore that she could barely sleep at night. Eventually, she was promoted to a wooden chair, but the backrest was much too small to lean against. The managers of this 164,000-employee factory, she surmised, believed that comfort encouraged sloth.

But in March, unbeknown to Ms. Pu, a critical meeting had occurred between Foxconn’s top executives and a high-ranking Apple official. The companies had committed themselves to a series of wide-ranging reforms. Foxconn, China’s largest private employer, pledged to sharply curtail workers’ hours and significantly increase wages — reforms that, if fully carried out next year as planned, could create a ripple effect that benefits tens of millions of workers across the electronics industry, employment experts say.

Other reforms were more personal. Protective foam sprouted on low stairwell ceilings inside factories. Automatic shut-off devices appeared on whirring machines. Ms. Pu got her chair. This autumn, she even heard that some workers had received cushioned seats.

The changes also extend to California, where Apple is based. Apple, the electronics industry’s behemoth, in the last year has tripled its corporate social responsibility staff, has re-evaluated how it works with manufacturers, has asked competitors to help curb excessive overtime in China and has reached out to advocacy groups it once rebuffed.

Executives at companies like Hewlett-Packard and Intel say those shifts have convinced many electronics companies that they must also overhaul how they interact with foreign plants and workers — often at a cost to their bottom lines, though, analysts say, probably not so much as to affect consumer prices. As Apple and Foxconn became fodder for “Saturday Night Live” and questions during presidential debates, device designers and manufacturers concluded the industry’s reputation was at risk.

“The days of easy globalization are done,” said an Apple executive who, like many people interviewed for this article, requested anonymity because of confidentiality agreements. “We know that we have to get into the muck now.”

Even with these reforms, chronic problems remain. Many laborers still work illegal overtime and some employees’ safety remains at risk, according to interviews and reports published by advocacy organizations.

But the shifts under way in China may prove as transformative to global manufacturing as the iPhone was to consumer technology, say officials at over a dozen electronics companies, worker advocates and even longtime factory critics.

“This is on the front burner for everyone now,” said Gary Niekerk, a director of corporate social responsibility at Intel, which manufactures semiconductors in China. No one inside Intel “wants to end up in a factory that treats people badly, that ends up on the front page.”

The durability of many transformations, however, depends on where Apple, Foxconn and overseas workers go from here. Interviews with more than 70 Foxconn employees in multiple cities indicate a shift among the people on iPad and iPhone assembly lines. The once-anonymous millions assembling the world’s devices are drawing lessons from the changes occurring around them.

As summer turned to autumn and then winter, Ms. Pu began to sign up for Foxconn’s newly offered courses in knitting and sketching. At 25 and unmarried, she already felt old. But she decided that she should view her high-backed chair as a sign. China’s migrant workers are, in a sense, the nation’s boldest risk-takers, transforming entire industries by leaving their villages for far-off factories to power a manufacturing engine that spans the globe.

Ms. Pu had always felt brave, and as this year progressed and conditions inside her factory improved, she became convinced that a better life was within reach. Her parents had told her that she was free to choose any husband, as long as he was from Sichuan. Then she found someone who seemed ideal, except that he came from another province.

Reclining in her new seat, she decided to ignore her family’s demands, she said. The couple are seeing each other.

“There was a change this year,” she said. “I’m realizing my value.””

via Signs of Changes Taking Hold in Electronics Factories in China – NYTimes.com.

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