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CTV News: China’s changing labour landscape

Mark MacKinnon
30 June 2010

As an unprecedented wave of strikes rolled across China this month – shutting car plants and electronics component makers – the staff at the Gloria Plaza Hotel in Beijing decided they, too, had had enough.

The four-star Gloria Plaza, which had done a thriving trade during the 2008 Olympic Games, unexpectedly announced it was shutting its doors for extensive renovations at the end of May, putting 400 people out of work – almost all of them poor migrants from the countryside. The hotel’s management said it would pay the minimum severance package required by law. But the staff decided they wanted more.

After years of donning smiles for guests who stayed in luxury suites while staff slept 20 to a room in a building over the parking garage, Gloria Plaza workers drew up placards reading “We Want Fairness” and “We Demand a Reasonable Offer.” Then they marched to the office of the company that owns the hotel and, when that didn’t work, they did it again, and again. Eventually, their protests brought the concession they were demanding: a severance payment of up to several thousand yuan each, depending on length of service.

“The workers had not been treated fairly. We worked for a long time for such small payment. We needed to take action,” said a 22-year-old electrician from Hebei province who would give only his family name, Chang. Though the hotel is now closed, Mr. Chang was still living in the squalid Gloria Plaza dorm – which reeks of urine and uncollected garbage – while he searched for another job. The hotel workers typically earned between 1,000 yuan ($155) to 1,800 yuan a month.

The labour action at the Gloria Plaza went almost unnoticed amid a series of strikes that have forced the likes of auto giants Honda, Toyota and Nissan to stop production at factories in China until they met worker demands. But the protests by the receptionists, bellmen, electricians and cleaners at the Gloria Plaza were motivated by the same discontent that led those working assembly lines in the south of the country to walk off the job: a sense among China’s tens of millions of low-wage workers that the time has come for them to share in China’s economic success.

China’s workers have not only been striking with new frequency in recent months, they’ve been getting their way. The strikes have forced double-digit wage hikes at Honda and Toyota, and more than 20 Chinese provinces and cities have moved to raise minimum wages since a watershed strike began in May at Honda’s plant in the city of Foshan in southern Guangdong province.

Though the Chinese government, for now, seems content to let the strikes happen, they have the potential to upend the low-wage economic model that has made China the “workshop of the world” and underpinned the country’s astonishing economic growth over the past two decades. It could also drive up prices for the ubiquitous made-in-China goods on store shelves in Canada and elsewhere, as manufacturers pass rising labour costs on to the consumer.

But Beijing apparently sees greater risks in allowing worker grievances to fester. A recent editorial in the state-run People’s Daily said the “made-in-China” model is “facing a turning point.” The paper came down on the side of the workers, arguing it is time to rectify the country’s widening gap between rich and poor, which some Chinese academics have argued is approaching the point where it poses a threat to social stability.

“Rural migrant workers are the mainstay of China’s industrial work force,” Premier Wen Jiabao said in comments that were interpreted as a sign of the government’s desire to see wages rise. “Our society’s wealth and the skyscrapers are all distillations of your hard work and sweat. Your labour is glorious and should be respected by society at large.”

A generational difference exists between the workers who helped propel China’s growth two decades ago and those who are taking strike action today, said Yu Jianrong, an expert in social issues at the government-linked Chinese Academy of Social Sciences. The former group, he said, were farmers and villagers who had come to the big cities hoping to make a little extra money for a few years before returning home. But today’s migrant workers, who in many cases are the descendents of the first group, have no desire to return to the countryside, and are agitating not only for better salaries, but for the chance to move up in society.

Low wages are just one hurdle. Skyrocketing housing costs, as well as the discriminatory hukou registration system, which denies rural-born Chinese access to many social services in the big cities in which they now live, make it almost impossible for migrant workers to climb the social ladder. Even those born in the big cities live with a rural hukou if that’s what their parents had.

“They’ve never been to the countryside; they don’t even know what the countryside looks like. They can neither go back to the countryside, nor can they fully enter life in the city. This is a big problem,” Prof. Yu said of the new generation of migrant workers. But after years of having their demands ignored, the momentum appears to be shifting in favour of those who have done the heavy lifting during China’s economic transformation.

“The whole of society is realizing how important these migrant workers are. They not only influence the enterprises they work for, they can also influence society and even the government,” Prof. Yu said.

So far, the strikes – at least the ones being reported – seem concentrated at foreign firms, Japanese companies in particular. Working conditions are no better at many Chinese-owned firms, though domestic companies often benefit from cozier relationships with local governments and the official All-China Federation of Trade Unions. Strikes at Chinese-owned companies are also less likely to be reported in the state-controlled media.

Whether the scattered strikes around the country will grow into a full-fledged labour movement is an open question. The ACFTU remains the only legal trade union in China, and although strikers at the Honda plant in Foshan broke new ground by demanding the right to form their own union, few expect the ruling Communist Party will allow the formation of independent labour organizations.

“So far, we’re not seeing co-ordinated action, just opportunistic strikes and a knock-on effect where one strike leads to another which leads to another,” said Geoffrey Crothall, spokesman for the Hong Kong-based China Labour Bulletin. “In the past, strike action tended to be chaotic and haphazard. No one really knew what was going on. Now we’re seeing workers demanding to elect their own representatives. That’s significant.”

At the Gloria Plaza, where a sense of accomplishment lingers among the former staff over what they their protests achieved, workers say they simply got tired of being taken advantage of.

“It’s not convenient to live like this,” said Helen Liu, a 22-year-old bartender from northeastern Shandong province, casting her eyes around the mosquito-infested workers’ dormitory behind the hotel. Her bed in one of the female sleeping areas was flush against her neighbour’s, and two other workers slept directly above them. There was no place for privacy, and only a tiny locker for the personal belongings of each of the 16 women who shared the space. “If factories and businesses were treating their workers well, this would not be happening,” she said.