The Condition Of Working Class In ChinaNovember 1, 2022
CHINA is the largest producer and exporter of consumer goods in the world market. These goods are damn cheap cost wise and have flooded the world market almost in all the countries. Most of the consumer market chains, like Wal-Mart, Amazon, Flipkart, Snap deal etc., sell these products at very competitive and attractive rates. Starting from Nail cutters, toys, shoes, buttons, door mats, iPhones, mobile phones, lithium batteries, laptops, computer’s hardware, glass & steel utensils, LED lights, bulbs, the entire range of electronic and electrical products, basic formulations of drugs and medicines, finished steel and aluminum bars, up to modern cars are being manufactured and exported from China to other countries. China has become a major exporter of fertilizers and pesticides. China produces half of the world’s steel and cement. Consumer goods made in China represent a largest share of the country’s exports. Most of the MNCs, the bulk producers from US, Japan, and European countries, had shifted their base of manufacturing units, and assembly lines to China after the 1990s onwards. Now the main question is why the goods produced in China are comparatively cheaper and at the same time the producers & the manufactures are still able to make super profits?
The main cause of this is the massive, uncontrolled exploitation of the Chinese working classes who are paid lowest salaries and are forced to live in city slums in inhuman conditions and work up to 12 hours a day, without any break or holidays. The use of child labor is another reason for low-cost productions. The workers are usually paid about $ 1.75 per hour which is only about 2.7% of the American counterparts. “Telecommunication workers in the United States earn $16.85 an hour, which is 15.5 times higher than wages at the VTech phone factory in China, where workers are paid $1.09 an hour, which is a below subsistence wage, and with very few rights or any benefits”. No labor laws operate in these factories, workers have no insurance cover for health & in case of accidents, retirement benefits are denied, and majority of them are migrant workers who have shifted from countryside, i.e., agricultural fields to city factories in search of better livelihood.”. And it is seen that “every year the number of people leaving the countryside increases by a million, forming a tide of migrant workers in the cities. At present, the total number of migrant workers from the countryside is somewhere between 200-300 million, of whom some 140 million are working in the cities. They now constitute a key factor in China’s working class”. And “this generation of migrant workers in China basically possessed all the characteristics of a proletarian class and, to a certain degree, working class consciousness. According to a survey by the Guangdong Provincial ACFTU, 81.5% of migrant workers regard themselves as working class, and “no matter the problems faced, all are working class ones”. Another report of 2015 indicates that “there are about 500 million employees. Within that total, the study reports that 29.3% of the total workforce works in “industry, construction and energy. This means that an industrial proletariat is more than 260 million people (it includes private industry and national, provincial and municipal state companies with industrial, construction and energy production activities). The largest sector of the industrial proletariat and service workers live and work in the large cities of the coastal areas. However, there are also significant numbers of workers in the smaller inland cities – in some cases employed in provincial and municipal companies and in other cases employed in private industrial companies which have begun to move inland in the search for lower wages. The mandatory minimum wage varies greatly according to the regions and inland areas. “The mandatory minimum wage is differentiated not only according to the provinces but also in the cities and regions of a province. The monthly range of pay was about 1,150 yuan in Anhui Province ($ 166.40) to 2,120 yuan in Beijing and 2,420 yuan in Shanghai”. Maximum of them is employed through the contractors, and work as temporary and short time employees up to 2 years or less. “The majority of migrant workers have low levels of formal education, often barely finishing 7 years. Statistics reveal that 40.31 percent of migrant workers only have an elementary level of education, 48% middle school, and high school only 11.62%. Those with a school post-secondary level of schooling amount to only 9.1%. Given their lack of professional skills, they are only able to find the hardest, most exhausting, and backbreaking forms of labor. Their life conditions tend to be very poor, most living in shoddy housing, tents, or even car trunks, or under bridges and tunnels”.
There is a system of internal passports in China called- ‘Houkou’ (the internal passport) which is required for the workers to move from the interior to the cities of the coast and determines their access to housing, health and education. On the basis of other studies, it is estimated that “60 million Chinese workers in these contractual conditions in the automotive plants where the work is focused, the calculation was 50% of “regular” workers and 50% of workers per agency (contractual). The latter earned an average of 80% of the regular’s salary, had shorter-term employment contracts, and it was almost impossible for them to enter into an indefinite contract and employment agencies were in fact subsidiaries of the companies that hired them. Women represent 50% of the Chinese workforce. In addition to its traditional presence in branches such as education, health and other services, its presence is mostly in industries that require precision work in small sizes, such as cell phone and computer assembly. If we refer specifically to the “wage gap,” a 2012 study indicated that women earned on average 67.3% of men’s wages in cities, and 56% in rural areas. While women’s salaries have tended to increase in absolute values, they do so at a lower rate than men’s, and the gap is now worse than 20 years ago”. The capitalist reforms introduced by China in 1978, led to an increase of inequality level for women.
And “According to official statistics, in 2003, throughout China, the number of workers who experienced workplace injury or death was over 136,000, 80% of whom were migrant workers. The number of workers with occupational diseases exceeded 500,000, 50% of whom were migrant workers. In 2004, an investigative survey revealed that in the Pearl River Delta, yearly incidents of injured fingers reached at least 30,000, with at least 40,000 fingers amputated. According to another 2004 survey conducted in Zhejiang, after experiencing workplace related illness, the majority of migrant workers buy some medicine to take care of it and leave it at that; only 24.4 percent go to a clinic. 14.9% work 8-hour shifts, 38.5% work 8–10-hour shifts, 29% work 10–12-hour shifts and 15.5 % work over 12 hours daily. Only 6.7% have an actual 2-day weekend off from work, 22.3% get a day off a week, and 56.3% have no guarantee of a day-off”. There is only one official trade union in China, i.e., All-China Federation of Trade Unions (ACFTU which was, formed in 1949, is an integral part of the Chinese Communist Party (CCP) apparatus of government. “The role of ACFTU was essentially a welfare organization, which worked together with the CCP and factory management as a transmission belt for the CCP’s key policies. But with the growth of private and foreign-owned or foreign-invested industry through the 1990s, ever greater numbers of workers fell outside this mechanism of control. The mass sackings in state-owned industry further weakened it, with membership dropping by sixteen million in just four years in the late 1990s”. “However, it covers only 27% of the Chinese working class. Its presence is greater in state enterprises than in the private sector. Its presence is much smaller (almost disappearing) in the factories exclusively owned by Chinese bourgeois like the Huawei”. “Within private industrial companies, particularly in the automotive terminals 64% of regular workers were affiliated to the union (in the case of agency workers, it dropped to 24%). In these companies, they act as an “integral part of the management team of the Chinese partners”. “In case of protest, no law protects them from being fired or even arrested for altering ‘social harmony’. Therefore, many accept the conditions and do not dare to raise their voices”. It will be seen that “although there is still no legal right to strike in China, in practice strikes are tolerated if they stay within acceptable limits—demands on the employer over wages or conditions. Any attempt to raise wider political questions, or to talk about independent unions, will attract repression. That strike leaders often lost their jobs following their return to work”. If any worker tries to form an independent Union or associations of the workers then they are arrested and sent to prison. However, in 2008, the ‘Labor Contract Law’ was passed to make an adjustment with growing class conflicts. “The Labor Contract law stipulates that “A laborer at a given work unit who has 10 years seniority” or “had signed two labor contracts for set periods of time” should be given a permanent work contract by that work unit. This stipulation attracted a panic from China’s capitalist class and many rushed to find ways to dismiss workers, trying to change their work duties in order to evade the Labor Contract’s restrictions”.
As per the National Bureau of Statistics of PRC the figures for 2015 for industrial units were: “No. of Large size industrial enterprises: 9633, Medium size: 54,070, Small size: 3, 19,445. In fact, China has more employees in the manufacturing sector than the US, France, Germany, Italy and Japan combined. According to the China Statistical Yearbook for 2015, China had 2,801,143 factories”. Data published by the United Nations Statistics Division shows that, “China accounted for 28.7 percent of global manufacturing output in 2019. That puts the country more than 10 percentage points ahead of the United States, which used to have the world’s largest manufacturing sector until China overtook it in 2010. With total value added by the Chinese manufacturing sector amounting to almost $4 trillion in 2019, manufacturing accounted for nearly 30 percent of the country’s total economic output”. Since economic reform began in 1978, “China has been among the world’s fastest-growing economies, relying largely on investment- and export-oriented growth. However, China’s GDP growth rate had slowed down since 2010, and decreased to 6.9 percent in 2015, which was the lowest growth rate since 1991. Its high productivity, low labor costs and relatively good infrastructure have made it a global leader in manufacturing”.
Up to the period of 1979, China followed the model of socialist economic development under the leadership of the Chinese Communist Party. It “maintained a centrally planned, or command, economy. A large share of the country’s economic output was directed and controlled by the state, which set production goals, controlled prices, and allocated resources throughout most of the economy. During the 1950s, all of China’s individual household farms were collectivized into large communes. To support rapid industrialization, the central government undertook large-scale investments in physical and human capital during the 1960s and 1970s. As a result, by 1978 nearly three-fourths of industrial production was produced by centrally controlled, state-owned enterprises (SOEs), according to centrally planned output targets. Private enterprises and foreign-invested firms were generally barred. Private enterprises and foreign-invested firms were generally barred. A central goal of the Chinese government was to make China’s economy relatively self-sufficient. Foreign trade was generally limited to obtaining those goods which could not be made or obtained in China. According to Chinese government statistics, China’s real GDP grew at an average annual rate of 6.7% from 1953 to 1978. From 1950 to 1978, China’s per capita GDP on a purchasing power parity (PPP) basis, a common measurement of a country’s living standards, doubled. However, from 1958 to 1962, Chinese living standards fell by 20.3%, and from 1966 to 1968, they dropped by 9.6%.” (1). The bourgeois economists attributed this major cause for this drop due to the Great Leap Forward from 1958 to 1962 and the Cultural Revolution from 1966 to 1976, the period of major upheavals. In fact, the real aim of the Great Leap Forward was to transform the Chinese economy from Agrarian to Industrial economy. Also, the aim of the Cultural Revolution was to root out the bourgeois and petty-bourgeois mode of thinking, habits, lifestyle, etc., and to remove “counter-revolutionary” elements in Chinese society. Definitely, such large massive movements involving millions of people both in cities and rural sides must have disturbed normal economic activities, thus leading to lower GDP.
After the death of Chairman Mao, on 09 Sep 1976, the process of dismantling the socialist system of economy in China started in 1979 onwards when Deng Xiaoping came to assume the political leadership of the Chinese communist party. Deng outmaneuvered the chosen successor Hua Guofeng. He became the de facto leader of China in December 1978 at the 3rd Plenary Session of the 11th Central Committee. The reforms carried out by Deng and his allies gradually led China away from a planned economy, opened it up to foreign investment and technology, and introduced its vast labor force for exploitation in the global market, thus putting the Chinese economy on the capitalist path of development. The entire capitalist-imperialist world called him as the architect of a new brand of thinking combining Communist control with free enterprise, dubbed “socialism with Chinese characteristics” or “Deng Xiaoping Theory” which was, in fact, a counter-revolution altering the socialist system of the planned economy into the capitalist economy. Deng quoted the old proverb “it doesn’t matter whether a cat is black or white, if it catches mice, it is a good cat.” His point was that when the capitalistic methods worked, then why not use them. “The central government-initiated price and ownership incentives for farmers, which enabled them to sell a portion of their crops on the free market. In addition, the government established four special economic zones along the coast for the purpose of attracting foreign investment, boosting exports, and importing high technology products into China. Additional reforms, which followed in stages, sought to decentralize economic policymaking in several sectors, especially trade. Economic control of various enterprises was given to provincial and local governments, which were generally allowed to operate and compete on free-market principles, rather than under the direction and guidance of state planning. In addition, citizens were encouraged to start their own businesses. Additional coastal regions and cities were designated as open cities and development zones, which allowed them to experiment with free-market reforms and to offer tax and trade incentives to attract foreign investment. In addition, state price controls on a wide range of products were gradually eliminated. Trade liberalization was also a major key to China’s economic policy. Removing trade barriers encouraged greater competition and attracted FDI inflows. China’s gradual implementation of economic reforms sought to identify which policies produced favorable economic outcomes (and which did not) so that they could be implemented in other parts of the country, a process Deng Xiaoping reportedly referred to as “crossing the river by touching the stones.”(1).
It opened a floodgate to restore capitalism – free-market economy, in place of the socialist planned economy in China. Foreign companies from all over the world were invited to invest and set up industries in these SEZs. Since the cost of labor power in China in comparison to western standards was quite low, uninterrupted exploitation was permitted for these foreign companies without any concern for working-class conditions and respect for labor laws. Major corporate companies from the US, Europe, and South Asian countries like Japan, South Korea, shifted their production bases to China making it the largest manufacturing hub in the world. They all utilized the massive cheap labor power of the Chinese working class. This made China the major importer of raw materials, components, and oil, metals & minerals, energy resources, needed for these manufacturing units. China became the major exporter of cheaper consumer goods, electronic finished products, computers, toys, household items, sports goods, medical equipment, but also a major supplier of bulk drugs. “Many U.S. companies have extensive operations in China in order to sell their products in the booming Chinese market and to take advantage of lower-cost labor for export-oriented manufacturing. These operations have helped some U.S. firms to remain internationally competitive and have supplied U.S. consumers with a variety of low-cost goods. China has become a large and growing market for U.S. exports; critics contend that numerous trade and investment barriers limit opportunities for U.S. firms to sell in China, or force them to set up production facilities in China as the price of doing business there” (1). All the foreign MNCs made super-profits for decades by indiscriminately exploiting the low-cost Chinese labor-power and cheaper raw materials & resources. That is why goods made in China were termed as the cheapest in the world market.
In today’s China there are two types of Industries, one is SOEs (state owned Enterprises) and second is private companies owned by Chinese bourgeois and foreign MNCs. During the process of dismantling the socialist economic base in China the role of SOEs was gradually reduced. “Under Mao, state-owned enterprises paid a substantial “social wage” in subsidized food and housing, as well as free education and health care and these were enjoyed by all urban residents. And even state-owned enterprise workers were still paid money wages, which they mostly spent on food and others”. “Ever since the start of the economic reforms, China’s working class has experienced a big change. With each passing day, the traditional working class has become ‘Commodified’ and rural laborers are unceasingly ‘Proletarianized’. At the same time, a large number of intellectual workers have been continuously thrown into the proletarian ranks. Under globalization, capitalist production relations have expanded in both the cities and the rural areas with a resultant simplification of existing class-based hostilities. The entire society is now divided into two hostile camps, constituting two mutually opposed classes, the capitalist and proletariat classes”.
Since “the administrative power in the Chinese factory system returned to factory directors, workers lost the democratic rights they once possessed control managers. In 1982 an investigative report on “Chinese Workers’ Situation” revealed that “factory leaders and cadres have devised means to secure good positions for their children, promotions, housing assignments, etc., which ultimately is harmful to the interests of the people.” These “factory directors” are appointed by state ministry cadres and are responsible for factory output and profit. Whether or not workers were satisfied with this, they had to agree to it. Whether or not the factory leader did a good job, workers were not expected to make any appraisals. It was said that “A worker should fulfill the duties of the master of the house, not exercise that master’s power. If the enterprise is run poorly the factory director would not receive a salary, but the workers always have job securities”.
From the start of 1985, large sized SOEs began to tie workers’ salaries to economic efficiency and profits and where the profit quotas called for within a specific period are fulfilled, administrators are allowed to have salaries that are between 1 to 3times the average salaries of workers and staff. Where profit quotas were not realized, factory directors’ salaries should be reduced. The contractor was the factory director and the person who monitored the contractor was the factory party secretary.
The Chinese Govt. had very fast taken steps to dismantle the socialist economic based industries in order to help the foreign MNCs. China had 160,000 SOEs in 2002. The structure of the economy was nonetheless changed radically. “By 2002 the share of state-owned and state-holding enterprises in gross industrial output value had shrunk to 41%, down from 50% in 1998; the share of wholly state-owned firms fell from over 30% in 1999 to almost 15% in 2002”. “Large state-owned enterprises (SOEs) have been downsized and partly privatized, and a stalled drive to sell off, close or otherwise restructure the thousands of smaller state-owned firms has recently been re-launched. The government has aimed to end destructive over-competition in some sectors by closing or merging smaller firms, whereas in other industries it has tried to promote efficiency by breaking up state-owned monopolies. The private sector has been given more scope, even official encouragement, to grow. Since 1999 the state constitution has been amended twice to upgrade the status of the private sector. The ideological dislike of capitalists that was a shared principle of communist parties everywhere has dissolved in China to such an extent that private-sector entrepreneurs have been allowed to seek CCP membership” (Coming of MNCs in China-report).
However,in the 1990s, “a key component of ‘strategic enterprise reorganization’ was the principle of ‘cutting redundancies and increasing efficiency’ was introduced in China. This came in many different forms, including early retirement inducements, internal reassignment, buying out of labor relationships, furloughs, layoffs, among others. By the end of 1997, Chinese SOEs had already laid off 6.34 million workers, 3.1 million of whom did not receive any subsidies for basic living expenses. This time period constituted an unprecedented attack on Chinese workers’ direct interests, forcing them to start to think seriously about how to defend their self-interests”. Again “from 1998 to 2001, SOE layoffs amounted to 22.5 million. Lay off workers’ life conditions took a turn for the worse. Those laid off during the third wave of layoffs in 2005, 68% had average monthly incomes of less than Y300 per month. 92% of their incomes were used to cover food, clothing, and children’s education. 88% of laid off workers had no way of supporting themselves and were left with no choice but to rely on government aid and relatives. From the third year of this attack on, SOE workers, and labor conflicts became much more intense. Collective actions rapidly accumulated, ultimately contributing to the wave of labor actions in 2002. By 2005, nationwide over 80,000 collective petitioning actions occurred, involving 4 million persons, 40 percent of which were worker led”.
These “retired workers numbered about 30 million (SOE retirees at 23 million, Collectively Owned Enterprises at 6.3 million) could be heard exclaiming that “Mao gave us the Iron Rice Bowl. Deng poked our eyes, Jiang Zemin stomped on us, and Zhu Rongji kicked us aside” and “When Mao was in power, workers had good spirits, were not easily bullied and were the masters of the factory. Since Deng, workers don’t have a penny to spend. Now their power has been handed over to foreign and leaders who exploit and oppress workers, serving the interests of a small minority. The state is only socialist in name, not reality” ….” In the early years of Chinese socialist development, the workers were the masters, enjoyed political status, pensions, health insurance, and were very motivated to work” and “the CCP was a party that truly depended on and served the working class: At that time, they had wages, they weren’t exhausted from their work, and they had health insurance, etc.” Who would say Mao was bad? When he was alive, every month they’d earn 30 to 40 Yuan, and they worked energetically. They didn’t lack for food or basic amenities and “these days who can afford to go to college even if you want to? If you want to find a job, you need to spend money. Today’s young people get married but don’t want to have children because they can’t afford the costs. Indeed, they still rely on their parents’ support, how could they try to raise children of their own?” The average income per head in China was around US$1,100 in 2003 and still below income levels in countries like Syria, Albania and Kazakhstan. Such is the condition of the working class.
Despite an official ban on strikes in China, the workers are still resorting to strikes. “At a shoe factory owned by a Taiwanese company in Shenzhen, managers and plant security officers often gave workers fines and made deductions from their wages for infractions. These resulted in a major strike by 3,000 workers who broke windows in the factory, burned garbage, and picketed en masse. In Dalian, at a wholly Japanese owned company, workers raised the issue of low wages with managers, only to be consistently ignored. So, a strike involving 6,000 workers broke out. After two days, the Japanese central office ordered managers to agree to the workers’ demands, but then the Dalian City Government sent in the police to repress the striking workers and their demands”. Another strike was in 2014, at “Yue Yuen Industrial, manufacturer of footwear, supplier of major global brands, in which 40,000 of the 200,000 workers of the different plants of this company went on strike for non-payment of social security fees”. An example in 2016 was “the conflict between the workers of the state-owned mining company Longmay who were protesting for several months at the delay in the payment of their salaries. The state then announced the laying off of 100,000 workers, 40% of the total workforce of the company. Another example was in the state steel industry Angang Lianzong, located in the capital of Guandong Province, where hundreds of workers went on strike against a plan to reduce up to 50% of wages and increase the mandatory daily workday to 12 hours, in some sector”. In these conflicts, the role of official unions was of course very negative by playing openly on the side of the employers or companies of the State. This shows that the working class in China is not sitting quietly, but is fighting to protect their rights continuously, despite the ban on strikes.
Some of the workforce in China “primarily engaged in computer programming and software research and development. These workers refer to themselves as ‘IT Migrant Workers’… As the numbers of white-collar intellectual workers constantly rose, in the second half of the 19th century Marx came up with two new categories: ‘mental proletarian class’ and ‘total worker class.’ Engels stated, “I hope your hard work will help university students more and more recognize that from their work process is produced a type of mental labor ‘proletarian class’. They have a mission that dovetails with their manual worker comrades, existing side by side as part of a class that will play a major role in the coming revolution.” Lenin also conceptualized the category of “engineer” proletarian.’ These new concepts took for granted that ‘mental wage-labor’ and ‘physical wage labor’ both comprise the categories of ‘overall labor’ or ‘production workers.’ This reflects the historical development of the working class”.
CCP (Chinese Communist Party) is stressing upon the harmonious relations between the workers and the capitalist class by guarantees of access to education, jobs, health care, elderly care, and housing, as goals for a ‘harmonious socialism’. “The foundation of social harmony and development is government spending along with capitalist’s paying out their share to secure something in the way of a ‘dignified’ wage. Their hope is to adopt the approach to capitalist production relations found in core capitalist countries like the US. But there’s no way of achieving harmony between China’s traditional working class and capital, since the former won’t let go of their memories of socialism”. It must be noted that “China’s new generation of workers have an increasingly difficult time finding ‘harmonious’ relations with capitalist owners. In line with the growth of the new generation of industrial workers, an increasingly urgent problem has emerged, namely uncertainty and no sense of what to do about the future. This generation of workers does not have the option of returning home to the countryside” but is ready to fight its exploiters.
It must be noted that “Labor and Social Welfare Ministry’s rules stipulate that in order to qualify to cash in on this benefit; workers need to have contributed to the insurance program for 15 years. Local city governments also have rules that have all the signs of discriminating against migrant workers. For example, in Shenzhen, for the five years before one retires, workers must have made contributions to the insurance system for 5 consecutive years. What that means is that a migrant worker who is between 50-60 years old needs to make sure that they have stable work at the same factory in the last 5 years of work. For workers who frequently change jobs, this ‘job stability’ is impossible to imagine. Thus, in the eyes of these workers, “money paid for premiums is lost money; If migrant workers are going without pensions or health care benefits, how is it possible to realize the Party’s goals to achieve a harmonious society?” Class collaboration is an impossible equation in Chinese society.
The living standard of China’s class of intellectual proletarians is getting worse and worse day by day. “Going by the official understanding of the middle class, those employed by foreign companies and the various forms of privately owned Chinese companies should make up the bulk of the ‘middle class.’ They are considered to be a mainstay of Chinese society, effectively acting as a buffering force preventing conflicts that arise from extreme disparities between the rich and poor. However, what intellectual laborers require in order to make their homes in the cities increasingly conflicts with what they are offered. Real estate brokers alone are able to make off with what most intellectual workers bring home in wages”. There is an ongoing struggle to unite the old workers of SOEs and migrant rural workers, whose labor is much cheaper. Both of them are facing similar struggles to survive and have common interests. As Marx put it, “the future transformation beyond capitalism is for this united class to make”.
For more than a decade, “the Chinese government has undertaken a restructuring plan for these industries (especially steel and coal), closing the lowest productivity plants and concentrating on the most efficient ones, and improving their technology. A part of this plan is in an accelerated process of implementation and involves the dismissal of 1,800,000 workers. The objective was to improve the overall productivity of these branches and the balance sheets of companies” and “the Chinese government developed a plan to eliminate the production of 50 million tons of “unproductive” steel (about 7% of total production) to concentrate on the large plants of the coast. This meant the dismissal of 300,000 direct workers – about 15% of the total of about 2,000,000 steel workers” and “linked to the increase in steelmaking productivity and the closing of steel mills, the plan was to reduce coal production by 250 million tons, through the closure of thousands of mines and the dismissal of 1,500,000 workers”.
In China today “the working class and a gigantic industrial proletariat, is divided by two broad lines. One is between workers of state-owned companies and those of private companies. The former reflects an “old” proletariat. They maintain some conquests: better salaries, greater respect for labor laws, more job stability, and more possibilities for access to retirement. On the other hand, they have an average age almost 10 years higher than that of private sector workers and get better opportunities in other state-owned companies. A new proletariat, working in private companies, arise from the industrial development of recent years, have lower wages, work longer hours, have less stability, and lower possibilities of access to retirement”. The Chinese retirement system has limited coverage for employees. Presently, “the official pension system only covers 40% of the population (contributors), with a majority participation of state employees. The coverage for the private sector is very weak”.
In the “private sector workers are younger, especially in high tech industries; the average age of workers is 24 years (40 years in the main western countries). This profile of young workers is repeated in companies that manufacture cell phones and computers, which refuse to take employees over 30 years and even fire those who exceed that age if they do not hold supervisory positions, with legal coverage to do so ‘under the argument that this person does not contribute anything to the company’….and those under 30 have no commitments, are cheaper, more ‘exploitable’ and more profitable in the medium and long term “. Also, “the older workers with lower educational levels, who are not in state-owned companies or do not have access to supervisory positions in the private sector, are increasingly condemned to jobs with lower wages and worse conditions labor, such as those in the clothing, kitchen or jewelry industries” and “many factory employees in China do not see that their life has a future beyond the assembly lines”.
For many, “the term, ‘working class’ conjures up the image of the proletarian manual laborers, which excludes white-collar- ‘thinking-laborers’. Ultimately, blue- and white-collar workers are both engaged in wage labor and, as such, their interests in achieving socialism should be the same. Thus, they should rightly be considered as a single working class…. In fact, ‘white-collar’ workers as part of the working class are merely more prosperous workers who have greater access to higher education and more opportunities to consume than the ‘blue-collar’ workers. The traditional proletariat may feel at odds with a burgeoning white-collar working class. Blue-collar workers tend to settle for lower-quality schools and infrastructure than white-collar workers. Thus, the middle-class label in opposition to the working class is reified as blue- versus white-collar workers, values, and cultural fissure”. Therefore, the need of the hour is that both blue collar and white-collar workers should stand united against the Chinese and foreign Bourgeois if they have to free themselves from the neck breaking exploitation.
There are always conflicts between the workers and the employers. “In many cases in private companies delays in the payment of wages, payment of overtime according to the law and improvements in working conditions, and inclusion in the system of retirement and sickness coverage. Other conflicts in the private sector were the payment of compensation from companies that relocated to another area or even another country. While Chinese law provides for payment in these cases, many companies take advantage of the situation to avoid paying”. “Government policy is to prevent the wave of struggles from spreading and deepening in the large industrial cities of the coast and, especially, to the heavy battalions of private industry”. In 2018, “the strike map included 1701 incidents, of which 73.3% affected local private companies, 11.6% state companies and 2.9% to foreign companies or joint venture”.
The real conditions in Chinese factories continue to be incredibly harsh. Workers are routinely exposed to a variety of dangerous working conditions that threaten their health and their safety. Low wages, long hours and excessive overtime remain the norm. Chinese workers have few, if any, options to seek redress and voice grievances under these harsh conditions. If workers step out of line, they may be fired without payment of back wages. Workers have no collective bargaining power, no collective bargaining rights whatsoever to negotiate for higher wages and a better working environment. Attempts to organize are met with dismissal, harassment, torture, punishment, and incarceration”.
The working conditions are very pathetic in mobile phone companies. “Every 11.25 seconds, a circuit board goes down the assembly line. The workers have to plug in four or five parts into the circuit board. That means they have 2.25 seconds to 2.8 seconds to do every operation. In one hour, they do 1,600 operations. In 1 day, in the 11-hour shift, they do 17,600 operations. And in the week, they do 105,000 operations, the same over and over again. The pace is relentless, furious, mind-numbing, exhausting. Workers who fail to meet the production goal have to remain working without pay until they reach the goal. Workers say they feel like they are in prison, as security guards roam the lines and often beat the workers” and “these workers are fed with some horrible food, coarse yellow rice and visibly rotten potatoes. Eight workers share each primitive dorm room. They sleep on narrow plywood bunk beds, often without mattresses. `It’s filthy, like a pigsty and when they want to wash, they have to get a small bucket, a plastic bucket, fetch some water, and bring it back to their dormitory and splash water on themselves. This is how they wash. Workers are instructed to spy on each other. Those who report others’ mistakes are rewarded monetarily”.
There are instances in some of the factories, where “80 percent of the workers try to flee the factory each year. To keep the workers from fleeing, management withholds one month’s back wages, including overtime, to try to control the workers and keep them in the factory. Companies also cheat their workers on their legal social security benefits which are due them. Millions of dollars are going into the pocket of management at the cost of the workers. The workers have to endure very long work hours, making very low wages, and doing very extensive–extraneous work”. In jelly shoes and socks were being made in a factory for export. “The workers’ heads are shaved with dye all over their bodies. Obviously, the dye is penetrating their skin and being absorbed into their systems”. “In 2010, labor exploitation at Foxconn China came into the spotlight when numerous workers committed suicide by throwing themselves off their dorm buildings. Reports determined that there were 18 suicide attempts and 14 confirmed accounts of death in 2010. Major tech companies, such as Apple, Amazon, Dell, Google and Hewlett-Packard, contract Foxconn to produce electronics”. “On a surface level, all of the line workers seem to be full-time employees. But many are part-time student workers. These part-time workers are usually students from Chinese trade schools who are “interning” at Foxconn’s factories. These so-called internships are usually underpaid line jobs. These “interns” only receive $3.15 per hour. Foxconn China is making its student interns and workers do overtime. Chinese labor law on student internships does not allow student interns to work overtime or night shifts”. It is difficult to describe the conditions of the working class in all the factories situated in different parts of China. What we described above is just a glimpse of that.
Now the last question is why “most multinationals get a better return on their investments in China than their global average? Yes, for better returns they go to China. U.S. Department of Commerce the report said the return on investment for U.S. businesses in China in 2018 was 11.2% compared with a global average return of 8.9% for American companies. Some 40% of European companies also say profit in China is higher than their global average. Last year’s (2017) rate of return was 11.2% for U.S. firms in China (forbes.com-Oct20, 2019). This is possible because of the abundance of low-cost labor, and lesser enforcement of labor laws. Not only that, another reason for MNCs going to China is the huge consumer market available for their products produced in China. The growth of the urban middle class also created strong consumer demands for the foreign MNCs. “According to the 2020 World Investment Report, in 2018 and 2019, China attracted a staggering $138 billion and $141 billion in foreign investment, respectively. In 2019, China was the world’s second largest recipient of foreign investment, second only to the United States. Why do so many foreign investors continue to pursue business in China –it is only for profit. China represents a global market opportunity that multinational companies around the world continue to exploit. For big companies China has become a major global market and a large profit center. China ranks 31st out of 190 nations in the world for the overall ease of doing business. By contrast, the U.S. ranks 6th out of 190” (The Conversation- Oct 19, 2020)”. As per information available “the total number of foreign-funded enterprises operating in China has increased from 203,000 in 2000 to 540,000 in 2017. About 40% of China’s exports are from ‘foreign-owned enterprises and joint ventures” (bid). It has 110 out of Fortune 500 companies, comparable with the US total. However, “the market share of multinationals in China has started to reverse, falling from an aggregate 16% of the Chinese economy in 2005 to 10% in 2018”. China is now facing stiff competition with other imperialist nations; thus, fierce competition would soon lead to the deep economic and financial crises in China. Capitalist System all over the world is facing similar crises daily and hourly, and coming out of one crisis is lending in to another crises.
Today “the Chinese regime and the Chinese bourgeoisie are sitting on the gunpowder barrel of the world’s largest working class and industrial proletariat. The gigantic Chinese working class and its industrial proletariat are waking up and starting to act. If this process continues, it can acquire proportions never before seen in any country in the world and collide not only with the economic model of the country but also with the dictatorial regime controlled by the Communist Party”….Although “the Chinese regime and the bourgeoisie have very powerful tools of armed forces with 3,500,000 troops and police forces with 1,600,000, and with a powerful armament that is increasingly modernized, as well as an effective secret service” but it can never suppress the growing mighty waves of working class movements. The Chinese working class, and the people, who have seen the days of socialism, free from exploitation, which gave them social security, in terms of health, education and post retirement life, cannot accept the present Chinese regime. It will definitely get organized on the basis of true Marxist-Leninist, Stalin and Mao Zedong thoughts and overthrow this Chinese regime.
Sources, Inputs, & References:
- Congressional Commission on China July 31, 2012.