As I write this article China’s President Hu is visiting the United States and meeting with President Obama and other government and business leaders.   Some of the familiar issues will be on the agenda:  currency evaluation, trade issues, defense issues and human rights.  Although there is no reason for its being on the bilateral agenda, one issue that is gaining momentum in China is workers rights. Let’s look at what has been the background of workers rights in China.

In China there is no freedom to organize labor; all unions are members of the All-China Federation of Trade Unions which is part of the Communist Party.  Over 200 million Chinese workers belong to these unions but they do not organize strikes or bargain with employers.  Union representatives in China have their salaries paid by management and they are generally supportive by management and government.  Strikes in China are mostly spontaneous events with leaders denying that they are involved or they will be arrested for political activity.             

However, Chinese workers are beginning to demand better working conditions, better pay, and the right to organize.  Let’s look at some of the key points in that movement.

• More knowledgeable Chinese workers are becoming a challenge for the major companies in China which once had access to an endless supply of labor.  Many migrate workers have found jobs closer to home and employers have to compete for new workers and prevent experienced ones from moving to better prospects.

• A labor shortage has motivated workers and inspired many strikes in the south eastern part of China although these strikes were quieted with higher salaries.  The supply of workers from 20 to 25 years old has reached its peak and will drop by a third in the years ahead because of the family planning policies of the government.

• Young Chinese workers are not willing to work long hours for low wages.  Also China’s growth in university enrollments mean there are fewer less educated workers willing to accept current conditions.

• Chinese workers want higher incomes because the cost of living in China is rising.  Also housing prices have been rising dramatically making home ownership impossible for many industrial workers.

• Access to internet and advertising has increased the expectations among young Chinese workers for better housing than they had in the past.

• The Communist Party recently passed a new labor law which urges stricter enforcement of work regulations and better protection of workers.   But local government, which depend on tax revenue from factories, are not always inclined to support the demands of the workers.

• In the early part of 2010, the municipal government of Beijing indicated it would raise its minimum wage by 20% and many cities and provinces are expected to follow that example.

• The salaries of Chinese workers are still very low compared to those in the US and in Europe.  The average hourly wage in China is about 75 cents per hour.  

• Another factor contributing to the impatience of Chinese workers is a dramatic rise in education.  An additional 3 million students in China will be graduating from high school in the next 5 years.  This means that a growing number of young people are ambitious, optimistic and more aware of their rights. According to Lin Yanling, of the China Institute of Industrial Relations, says, “Their fluency with technology –cell phones, email and internet chat, connects them to peers in other factories, which makes them less afraid to challenge authority”.

There is no question that Chinese workers are speaking out more directly for improved working conditions, better compensation, and closing the gap between wages in other emerging countries.    The central government and the Communist Party are sensitive to these complaints and are trying to address the situation and eliminate potential unrest.  The big question is how much will the cities and provinces really address this issue and improve working conditions with might affect their competitiveness in world markets.

 
Richard King
Chairman Emeritus of Woodbury University
Director, Pacific Rim Programs at Woodbury University
Chairman/Founder King International Group
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