China: The new working class

The new working class in China On a recent visit to China, Greg Evans met several labour activists. He reports on his impressions of the transformation of the Chinese workforce under the impact of rapid capitalist development over the last 20 years

In 1989 China’s leader Deng Xiaoping watched the fall of the Berlin Wall. His government had, from 1978 onwards, ushered in the first pro-market reforms in agriculture. As he witnessed the collapse of the Soviet Union over the next few years, the reform process accelerated, transforming Chinese society into a major capitalist power. The China of today and its burgeoning working class is very far from the grey, atomised mass of the old Stalinist states.

The city of Shenzhen and its migrant workers

Thirty years ago Shenzhen – a city just across the border from Hong Kong – was a small fishing village; today it is an urban monster of 30 million people, one of the country’s biggest concentrations of workers and living proof of the effect of Deng Xiaoping’s reforms.

Shenzhen is no spontaneous creation. The government’s policy is to create a new working class, a new urban population at a rate of 10 million a year. It aims to sustain China’s economic development by creating 10 million consumers a year, adding a workforce the size of the whole of Western Europe every 15 years.

For 60 miles on both sides of the motorway from Shenzhen to Guandong in Canton, there are small factories with dorms divided up by partitions. On the outside there is often a row of overalls drying and people cooking and eating on their balconies. There are no other buildings; everything is a factory for 60 miles.

This working class comes into being through internal migration. Migrant workers are the number one social phenomenon of China – all 170 million of them. How do they live? The going rate is 1,000 Yuan a month, which is about US$120 or £60-70 – a rise from around 700-800 Yuan over five years ago. Of that 1,000 Yuan, 150-200 a month is deducted for food and accommodation.

In the first period when migrants came to the towns in China they looked like the migrants who had just arrived in London in the 19th century, wearing second hand clothes, dowdy, lost in a big city. Migrants go back, at best, once a year to their village. Some people have only been back once in three years. Their kids live with their grandmother. They don’t go out because every penny they earn they send back to the village.

In one of these migrant shanty towns I met a woman from Inner Mongolia who was earning 1,000 Yuan a month. She said “this was all I could earn in a year in subsistence farming back in Mongolia”, adding, “when I say 1,000 that’s a nominal figure. We don’t live in a money economy.” That’s why they want to be migrants. They support themselves. They are exhilarated by being in a town that is constantly changing – where you can make your fortune or break your fortune.

The workers live in dormitories in which there are often 40 people (young and mixed sex) stacked up in bunks in an area 60 feet square. They don’t have the same rights as “settled workers”; as there is no welfare state, all health care is paid for in cash if you need medical treatment. It is the same for migrants’ education, which is why they don’t bring their kids to the cities. If you have the right to live in an area your kid can go to school free, but migrant workers have to pay.

The factories range from the good to the bad to the downright ugly. In the good ones it’s very orderly. One worker at a modern factory told me that after all the bad ones he’d been to, this was great because it “had gardens”. The management drive round on golf buggies and everyone wears a clean uniform; they sleep two to a room and they don’t have to march in ranks to get their food. The bad ones are sweatshops. In the dorms there is no electricity. Rats run around. The workers suffer sexual harassment, bullying, violence. In the ugly ones the whistle blows at mealtimes and you march in step to get your food; it’s ladled into a mess tin and you march on.

In one such factory, BYD, I saw 17,000 women stop work and go to lunch. With its 25,000 workers, it’s like the Putilov Factory in 1917 in Petrograd, Russia. BYD is just one of several hundred factories of that size in one Special Economic Zone (SEZ) in Shenzhen. And there are many SEZs.

Workers’ struggles

Until around the turn of the millennium, the workers’ struggles were mainly carried out by the steel workers, dockers and others in traditional heavy industries who enjoyed security of employment – the “iron rice bowl”. The enterprise supplied you with everything: cinema, education, healthcare, a pension. But marketisation blew all this away; most of these places were semi-privatised, handed over to their management at a ludicrously low price and with all the workers’ benefits torn up, given away by the “trade union”, which was completely complicit in the process.

A whole series of strikes broke out between 1999 and 2004-05 trying to defend the old system. They were all defeated and with serious consequences. Human Rights Watch lists about 23 recognised trade union militants who are in jail at present for defying the official union and going on strike. Nearly all of them come from the rust belt of China in the north east and Manchuria. Nearly all of them are steel workers.

Now a new generation of workers (see box) are flexing their muscles; there is a strike of more than 1,000 workers every day in south China (the government only report strikes of more than 1,000 workers). That makes China the centre of the world for strikes – yet strikes are illegal.

How did this come about and how have they begun to fight? The first level of struggle is to change jobs. One young woman, 24 and a workers’ organiser, told me “I came to the city as a teenager”. She left school before university and she’s taught herself. “What’s the process I’ve gone through? I went to one factory – it was rubbish. I stayed there a month and moved to another factory. After a while you work out for yourself that moving all the time is not going to solve the problem – they’re all shit. Then when you settle yourself down in a decent workplace a lot of the problems are individual problems. You respond by working slowly, then when you get really pissed off, somebody passes round a tiny piece of paper from one person to another just saying ‘strike’ on it.”

The first strike she experienced, they all marched out. The manager was very wily and the next day when he turned the lights on in the factory at 5am, he said that “everybody is working, you should go back in.” When they went in they realised it was a trick. So the next day they went to work and just didn’t start. She had gone from moving job, to a strike, to an occupation in just a few weeks.

The main grievances concern unpaid wages . . .

The foreign-owned companies like Alcatel, Dell and Apple have highly humane “show factories” where their workforce is treated well and paid as much as the Chinese government will allow them. But their suppliers are very different, consisting of mainly Hong Kong, Macao and Taiwanese-owned factories. Conditions are poor and the employers regularly fail to pay wages, provoking the workers, individually or en masse, to fight. Over the last five years, Chinese workers have won US$6bn in unpaid wages through the courts. Yet one sociologist has estimated that 95% of these cases never even come to court.

. . . and compulsory overtime.

Alco is a big factory, with 8,000 workers (all under 25 and 60% women) occupying a huge site. It makes components for LG headphones. It is highly mechanised and modern. The strike’s roots lay in the effects of rising inflation on the workers. Pork prices are up 60% and rice prices up 30% over the last year. From a take home pay of 1,000 to 1,200 Yuan, Alco management deducted 150 Yuan for food and accommodation. Then as food prices doubled, Alco management proposed an increase to 300 Yuan.

Immediately, all 8,000 people walked out of the factory. They set up a picket line and blocked the road. The riot police moved in with water cannon, but crucially the strikers did not give up at the first sign of police – they didn’t scatter. They were not frightened that they were going to be put in the gulag. In the end the cops baton-charged the strikers and arrested a few people, but by fighting, the workers forced the management to withdraw the increased deduction – for now.

Economic factors

There are some very acute economic factors creating and sustaining this militancy. The first one is the labour shortage. After the New Year break, hiring fairs are held everywhere in China. As migrants get off the train from the countryside, they find the hiring fair. On every street corner migrants can get a job anywhere in China. The big hiring fairs are like university careers fairs, except in a big hall and the employers can more or less take workers straight from it and put them in a factory.

This year, for every seven jobs there were four workers. In Shenzhen as many as three in ten migrants who went home for the New Year break did not return to their jobs. People move to better jobs with better conditions and pay. In the absence of collective bargaining and a functioning labour market, that is all they can do.

Rising food prices and heavy government investment in pig farming and rural infrastructure, intended to overcome the shortages in pork production, have moreover encouraged migrants to return to the countryside. Migrant workers say: “you know that farm we used to work on that was rubbish and didn’t have internet and paid poor wages? The wages have doubled, the services are better because the government wants to produce pork. Here the bosses are trying to cut our wages. Let’s go back.”

Hu Jintao’s Contract Labour Law

President Hu Jintao’s new Contract Labour Law, introduced on 1 January 2008, was a significant sign of change. The Hu Jintao regime is very different from its predecessor, the avowed neo-liberal Jiang Zemin. Hu Jintao wants to build and maintain “social harmony” while embedding capitalism. The Contract Labour Law was a sign of that new orientation, as well as a response to this rising militancy.

The labour law is very basic, in that it gives workers the right to consultation over their terms and conditions. It does not give negotiation rights or collective bargaining but it does give workers redundancy pay and the right to sick pay after 90 days of employment. The longer workers have been in employment, the more they are entitled to.

During the debate over the labour law, the American Chamber of Commerce in Shanghai wrote a document, which it has since taken down from its website, saying that the law would mean US businessmen will disinvest in China. The response of GAP and Nike was revealing. They were furious, saying “we’ve spent five years trying to overcome the image that we are ripping off the Chinese worker and the American Chamber of Commerce is threatening to disinvest if Chinese workers get rights.” Such things are done not said. The very same companies, GAP, Nike and Alcatel, quietly pressured the Chinese government to water down the rights in the draft contract labour law, but behind closed doors.

But the law is nonetheless national, and where certain localities have tried to pass local laws exempting themselves from it, the bureaucracy has stepped in to stop them. Employers have found other ways to dodge the provisions of the new law. As it took effect all sorts of companies from Macao-owned sweatshops through to big, mainly Korean and Japanese companies, like Olympus, said: “we want you to resign en masse because this law is going to damage you and if you resign now, we’ll hire you on 1 January anew but you won’t get any of these rights because you have to have been here for so long.”

I talked to a couple of workers who had worked 10 years as migrants earning 2,000 Yuan a month between them. The employer told them that unless they resigned he would cut their hours to the minimum eight hours a day, so reducing their joint earnings to 850 Yuan a month. It’s only by working 70 hours a week that they are able to earn a decent wage. As a result a lot of the old workers did leave, but in some cases rather than being rehired they’ve been replaced by school leavers on temporary contracts.

Other owners responded to the new law by closing down. Within three weeks of that law being passed, 10,000 factories closed in Shenzhen alone. Nearly 95% of them were Hong Kong, Macau or Taiwanese-owned.

Organising migrant workers

As migrant workers are outside the framework of the official unions they have traditionally turned to lawyers for help. In China the constitution contains enough clauses setting out workers’ rights in general that it provides the basis for seeking redress for unpaid wages, sexual harassment etc. If you can find a lawyer with courage and skill, you can win quite a lot in the courts.

But now migrant workers are turning to more collective forms of organisation. The Shenzhen migrant workers’ centre is interesting from this point of view. It was set up by a worker called Wang with compensation money he received after a fire disfigured and disabled him. Migrant workers flock to it. On Saturday morning it’s open to the front street, a shop front. People come in all the time. It has a library of faded paperback novels and they pay 1 Yuan, get the novel, sit at a table and sleep. When they wake up they’ll say “I haven’t been paid, what shall I do?”

It’s a very basic form of workers’ organisation but it’s there and it is independent. Wang has banned lawyers since he believes that even people who left school at 14 can win by studying the law, and that’s what he teaches them.

While I was there, young women who do individual case-work on a voluntary basis, were arranging to leaflet hospital casualty wards to find workers hurt in accidents and inform them of their rights. Industrial accidents happen all the time. One leaflet explains: “What a contract should include in a clothing factory”; another, “Domestic violence, what you can do if you’re a victim”; yet another, “Sexual harassment in the workplace, what to do if you’re a victim.”

But being active has its costs. Wang has been attacked when doing individual casework. He was stabbed, beaten up, nearly killed, and the Centre smashed up with iron bars, twice. The police have now trained a CCTV camera on the Centre to protect it – the state was very embarrassed by the attacks – but now everything that goes on in the Centre is seen by the police.

The All China Federation of Trade Unions (ACTFU) wants to take over the reins. Deputy Chair of the Shenzhen ACFTU arranged a meeting of lawyers to have a workshop with the official trade unions and the migrant centre. The gist of his talk was this:

“You civil society rights activists are people with the understanding, who have done a lot of work that should be the government’s responsibility. You have used different means, some of them cause harm, some of them are unconventional, but overall your work has taken effect. It has resulted in pushing forward the work of the government and in that sense the para-legal agents in Shenzhen have played a positive role. So we’re going to set up 60 centres like this, except the trade unions, not you, are going to run them. But there is just one thing, because we’ve never done it before, would you please explain how?”

The ACTFU tries to reform itself

The ACTFU has 170 million members; the combined membership of all the unions in the International Confederation of Trade Unions (ICTU) comes to about the same, so the Chinese union federation is as big as all the other unions in the world. It is a government-run union, part of the state – the general secretary is a member of the Politburo of the Chinese Communist Party. Most of the workers in jail for offences related to trade unions are there for defying it or trying to form an independent union. Yet in 2006 it started trying to become a real union.

The Chinese bureaucracy has realised that if you have a capitalist market with foreign firms then you need something that represents the Chinese workers and it cannot be the foreign owners. So the ACFTU has taken upon itself the task of trying to win labour contracts with every foreign company. This is an easy win. A lot of those companies, like Alcatel, Apple and Dell, are more than willing: they wanted to pay workers more to reduce staff turnover. Paradoxically, in the past the ACFTU has prevented them from doing this by stopping them paying more than the national average wage.

But there are exceptions among the multinational corporations. When the ACFTU approached Wal-Mart, the US firm told them they would not allow the trade union to represent their staff, so incredibly the union officials organised a campaign from below. They got out of their limos, went round the outside back entrance of Wal-Mart and handed out leaflets.

The workers they talked to said “Who are you? I’ve never heard of the All China Federation of Trade Unions. Can I be arrested?”. “No”, they replied “We’re the government!” After two years Wal-Mart caved in and signed. But of course this victory has not led to the election of workplace representatives and the union is still invisible on the ground.

But an article by Chen Yu, the leader of the Shenzhen Federation of Trade Unions, indicates that this partial breakdown of the government/union monolith may lead to further reforms in the future. Chen Yu writes: “China’s trade unions have the world’s best organisational framework and largest membership roster, but their real status is an embarrassing joke. Political meddling throughout the system has prevented genuine and effective union organisation therefore, when the government takes its responsibilities seriously trade unions need to do so too.”

Chen Yu then explains that the new Contract Labour Law effectively removes the strike ban. The draft regulation does not go so far as to call a strike a strike (it continues to refer to work stoppages, slowdowns and lockouts) but it no longer insists that when such incidents occur, trade unions have to help enterprises resume production as quickly as possible. This may give trade unions more room for manoeuvre. This Communist Party trade union bureaucrat concludes: “We are one step away from the right to strike. This paper thin barrier can be breached.”

In recent years a second wave of migrants has come to the cities – migrants who have grown up during the period of rising wealth and seen their parents or elder brothers become rich in the cities, sending money back. They expect when they go to the city they will be working in a “good” factory, even though there are four bad factories to every good one.

But they are much less tolerant of the bad conditions and, due to improvements in the Chinese education system over this period, better educated. They are no longer shabby. It’s noticeable how in the last five years migrants have begun to look really feisty, and very fashionable. The men gel their hair and the women dress in western fashions. Any Chinese high street has shops like Dolcis, Bata and H&M, all full of ripped off Chinese brands.

In the migrant districts of Shenzhen there is an internet café on every street corner, with the ubiquitous government sign saying “Subversion is a crime against the state”. The Chinese state has 30,000 full-time officials monitoring the internet, but its popularity is not to do with political subversion; it’s the discovery of individuality and the world outside China. Migrants may come from a village where they can run round barefoot and where people have never seen an airplane fly over – then suddenly they are on the internet. It’s an amazing thing for them. Sociologically, they have changed.

There has been a change in living conditions as well; there are now migrant communities in flats. As time has gone on and as the social pressure on local government has increased, the authorities have started to build social housing for migrants.

I was in Russia at the very end of the Stalinist period and saw the atomisation of the Russian people and above all the working class. It was like a fascist country. Nobody wanted to go out. You didn’t want to be seen to be doing anything.

By contrast, Chinese people live on the street, like they do in Mumbai. They’re out there. It’s impossible to repress people at that same level, therefore there is a new society. Within 20 years of the migrant phenomenon beginning there are now whole migrant communities.

You can have secret policemen on every corner but it is impossible to completely repress individual freedom of expression.

Tue 02, December 2008 @ 18:00