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Chinese labour in the global economy: capitalist exploitation and strategies of resistance

by Andreas Bieler on January 9, 2017
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China is generally regarded as the new economic powerhouse in the global political economy. Some even talk of an emerging power, which may in time replace the US as the global economy’s hegemon. And yet, there is a dark underside to this ‘miracle’ in the form of workers’ long hours, low pay and lack of welfare benefits. Increasing levels of inequality have gone hand in hand with widespread working conditions characterised by super-exploitation. Nevertheless, Chinese workers have not simply accepted these conditions of exploitation. They have started to fight back. In a new special issue of the journal Globalizations, co-edited by Chun-Yi Lee and myself, the contributors have analysed these various forms of resistance by Chinese workers and the way they are organised. In this blog post, I will provide a brief overview of the contents of this special issue.

untitledAfter Andreas Bieler and Chun-Yi Lee provide an overview of the location of Chinese production in the global economy as part of the new international division of labour in the introduction to this special issue – for a free copy click hereJane Hardy analyses in detail how Chinese production is integrated into the global political economy along lines of uneven and combined development. While Chinese development is closely combined with global development, it is also extremely uneven between China and other countries as well as within China itself. Hardy further indicates how the stimulus package in 2008, with which the Chinese government attempted to avoid being dragged into the global recession, resulted in a huge crisis of overaccumulation. Ultimately, China’s response to the global financial crisis is based on a fundamental contradiction. On the one hand, the government intends to boost domestic demand through higher wages to become less dependent on exports to North America and Europe; on the other, however, it needs to keep wages low to ensure increasing productivity and continuing competitiveness, on which large parts of Chinese exports are based.

Andreas Bieler and Chun-Yi Lee, in turn, start their comparative analysis of resistance in the cheap labour, low value-added electronics sector in the Pearl River Delta (PRD) area and resistance in the higher-value added IT sector in the Yangtse River Delta (YRD) with an analysis of the different locations of these two production sectors in the global economy. Because the electronics sector is mainly based on cheap labour, there are higher levels of industrial conflict over pay and working conditions. By contrast, the higher-value added IT sector depends on a more skilled and stable workforce. Hence, it has to provide better pay and working conditions. Unsurprisingly, these different locations in the global political economy shape the forms of struggle in the two sectors. In the electronics industry, informal labour NGOs generally assist workers individually and collectively in securing their rights, often in open confrontation with management, while more formal labour NGOs in the IT sector focus on organising interesting after-work activities for workers. Does this indicate that general upgrading to more high-value added activities could be a more general path towards improved working conditions for workers?

Boy Lüthje and Florian Butollo’s research casts doubts over this assumption. They investigate in more detail the electronics contract manufacturing (ECM) industry in China’s Pearl River Delta (PRD). They identify technological upgrading and diversification of production, combined, however, with a continuation of super-exploitation of workers, based on extremely flexible mass production with a low-skilled workforce and a high turnover of personnel. There have been some modest wage increases due to an increase in the minimum wage, but base wages in general remain low and workers continue to depend on excessive overtime. In short, the linkage between industrial upgrading on the one hand, and an upgrading of work and labor relations on the other is weak. Social innovation in the workplace is still missing.

How can we then understand the role of the Chinese state in industrial development and workers’ struggles for their rights? In their article on class struggle and the Chinese state, Chris King-chi Chan and Elaine Sio-ieng Hui argue that neither the notion that the role of the state has been undermined by globalisation, nor the concept of the state as an autonomous, independent actor are adequate, when assessing the Chinese state. Rather, the state needs to be understood as a field and condensation of class struggle. Hence, during the economic crisis global capital pushed the Chinese state towards reducing the protection of workers. In the wake of economic recovery, however, workers started to re-assert themselves in a wave of strikes such as the strike at Honda in 2010 and at Yue Yuen in 2014. To ensure the overall continuation of capitalist accumulation the state had to intervene in their support in relation to demands around collective bargaining and company contributions to social insurance systems. In short, class struggle rather than technological upgrading is the way towards improved working conditions.

This conclusion is supported by Tim Pringle. In his contribution to this volume, he pursues a class against capital approach in his analysis of rising demands for collective bargaining by Chinese workers. Interestingly, in his analysis of class struggles in the southern province of Guangdong, he also analyses in detail the struggles of the highly precarious and fragmented sanitation workers in Guangzhou in addition to the more well-known strikes in the Honda-owned auto parts factory in Foshan, at the Yantian International Container Terminals and the Yue Yuen shoe manufacturer in Dongguan. Overall, he argues that labour has emerged as a class against capital in Guangdong changing the balance of class forces and pushing capital and state into forms of collective bargaining.

The article by Jenny Chan and Mark Selden focuses specifically on the situation of China’s migrant workforce. A new generation of migrant workers is emerging, they argue, which no longer intends to return to their homes in rural China, but wants to improve their lives in the cities, where they are working. Against the background of super-exploitation in companies such as Foxconn they adopt a variety of strategies to support their demands for better pay, better social benefits and more human working hours. The state increasingly attempts to intervene in disputes also through the official All-China Federation of Trade Unions (ACFTU) to mediate between workers and employers, but workers are continuing to push independently to secure their rights from employers. Considering the crucial location in global commodity chains and the fact that there is a decrease in the number of young workers, these workers enjoy considerable bargaining power vis-à-vis employers and the state. It is this bargaining power, which ultimately ensures that class struggle results in gains for workers.

Xuebing Cao and Quan Meng analyse the strike by dockworkers at the Yantian International Container Terminals in 2013. They demonstrate how these workers were able to organize themselves towards strike activity in the absence of an active official union, which resulted in a pay increase of 30 per cent. They could rely on a range of different sources of bargaining power, including most importantly, workplace bargaining power. The introduction of new technology in ports had implied that the work carried out had become ever more specialised. Hence, when these workers went on strike, their company was unable to replace them.

In their contribution to this volume, Stefan Schmalz, Brandon Sommer and Hui Xu analyse the underlying dynamics of the mass strike at the shoe factory Yue Yuen in Dongguan. Overall, three factors contributed to the strike. First, there has been increasing low wage competition by other regions in China and other countries putting downward pressure on shoe factories in southern China. Employers such as Yue Yuen attempted to cut costs by not paying social insurance contributions. Second, the Communist Party’s anti-corruption campaign is creating new spaces for workers to demand that employers comply with their legal obligations. Third, social insurance payments and their vital importance for older workers close to retirement have increasingly become an important issue for industrial conflict. Interestingly, unlike Chan and Selden in this volume, they point out that it is not necessarily always younger migrant workers, who take strike action. Middle-aged and older migrant workers too go on strike in order to defend their social protection such as pensions upon retirement. When it became apparent that their employer Yue Yuen had not paid the legally required social insurance payments, 40,000 workers took strike action concerned about their personal future.

Against the background of two closely related hope projects – the global hope project of China as an object driving global growth as well as the Chinese hope project based on building national strength and modernity – Ngai-Ling Sum traces the emergence of a new subaltern class in China, the so-called Diaosi. This new group, on the one hand, actively embraces its loser identity and marginality in Chinese society. At the same time, she also demonstrates that this development does not automatically imply that these Diaosi form a group of resistance to their exploitation. Many actions are also an expression of resignation. Capital, moreover, attempts to re-integrate the Diaosi into society by providing particular avenues of specific consumption for these people. It discovers the Diaosi as a potential market and thereby pacifies them. Finally, the state increasingly attempts to control their actions of resistance in the name of civility and social stability. In short, mounting resistance by Chinese workers against super-exploitation should not be taken for granted. It emerges in processes of class struggle, which also include moments of exploited workers’ co-optation into the hegemonic Chinese modernisation project.

Globalisation has put different national labour movements in competition with each other. Hence, the level of exploitation of workers in China has direct consequences for exploitation levels of workers in other countries. Unsurprisingly, the global labour movement in its institutional expression of the International Trade Union Confederation and various Global Union Federations assess their possibilities of engaging with Chinese labour organisations and workers’ struggles and here in particular the ACFTU. With about 134 million members, it appears to be too powerful an organisation to be disregarded. And yet, in their contribution to this volume, Rob Lambert and Eddie Webster caution against a rush towards official contact. As they point out, the ACFTU is actually part of the Chinese labour regime. Being closely aligned with, and subordinated to, the Chinese Communist Party, the ACFTU has little room for independent manoeuvre. Most importantly, the ACFTU has not accepted the international labour standards of the ILO including, for example, the right to free association. Rather than co-operating with the ACFTU, Lambert and Webster conclude, international labour organisations should support informal labour NGOs, local workers and their struggles. Simultaneously, they should intensify their pressure on the ACFTU to accept international labour standards.

In the Conclusion to this volume – available for download here – Andreas Bieler and Chun-Yi Lee analyse the new sources of power available to Chinese workers and assess the crucial role of informal labour NGOs in organising resistance.

We acknowledge the grant of £275k by the Economic and Social Research Council (ESRC) for the project on ‘Globalisation, national transformation and workers’ rights: an analysis of Chinese labour within the global economy’ (RES-062-23-2777). This special issue, on which this post is based, is part of our outputs from this research project.

 

 

Andreas Bieler

Andreas Bieler is Professor of Political Economy at the University of Nottingham and Co-Director of the Centre for the Study of Social and Global Justice (CSSGJ).

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