Mary E. Gallagher Director, Center for Chinese Studies Associate Professor of Political Science University of

Since 2004, increasing evidence of a “labor shortage” in coastal, labor-intensive manufacturing sites Working population ratio now falling due to effects of the one-child policy Domestic stimulus and agricultural policy changes improving inland employment options Hukou-related institutional barriers to permanent migration Mary Gallagher, 2010

 In a national survey of firms in 2009, only 3% of non-state firms said they had too many workers. 40% said that they could not find enough workers.  Real migrant wages continued to rise during the crisis, as reported by PBC and NBS  In China Urban Labor Force Survey, migrant workers reported a 13% increase in monthly wages between September 2008 and February 2010 – despite the crisis Mary Gallagher, 2010

 Second generation of migrant workers more aware, more demanding, and better educated.  Different frame of reference and different expectations than their parents. Aspiring urban citizens.  Higher exposure to mass media and communicative technologies. Mary Gallagher, 2010

 Wage Differential between Japanese and Chinese workers a key rallying point  “Apprentice workers” were the most hardcore supporters of the strike action  Differences between younger and older workers particularly striking; younger workers more radical  Even younger workers stuck to peaceful strike measures, processes of representation, and strategies to protect themselves from retribution  Wages demands were key; but workers also demanded “their own” trade union  Negotiations handled by the CEO of the Chinese partner, with participation from a leading labor relations professor in Beijing. Limited Trade Union Role.

 Central government promulgates more protective laws  Media coverage of issues has increased  ACFTU-affiliated trade unions have been given more (but limited) powers Mary Gallagher, 2010

 1995 Labor Law 40-hour work week 5 kinds of social insurance Consultation with the trade union 36-hr max overtime/per month  2008 Labor Contract Law Strict limits on short- term contracts Punitive fines for non- signing of contracts Severance pay for contract expiration Mary Gallagher, 2010

地区 上海Shanghai 690 元 750 元 840 元 960 元 1120 元 北京Beijing 580 元 640 元 730 元 800 元 960 元 广州Guangzhou 684 元 780 元 860 元 1100 元 深圳Shenzhen 690 元 810 元 850 元 1000 元 1100 元 苏州Suzhou 690 元 750 元 850 元 960 元 杭州Hangzhou 670 元 750 元 850 元 960 元 1100 元

Mary Gallagher, 2010

 All-China Federation of Trade Unions (ACFTU) is the only legal labor organization in the country.  By law, employees in any company with 25+ employees can form a union under the auspices of the ACFTU.  Recently a renewed drive to organize employees of foreign and private firms (Walmart and Foxconn). Mary Gallagher, 2010

 Labor laws and trade union law all empower trade union to bargain collectively  However, collective bargain often determined in advance by local government (debate is now more open, however…)  Problem of employer representative and union representative – all are government entities!  Central Government states that collective wage bargaining system to be established by 2012  Local governments now developing specific guidelines ( 广东省 企业民主管理条例 － Guangdong Province Regulations on Democratic Management of Enterprises ） Mary Gallagher, 2010

 Right to Strike taken out of Chinese Constitution in 1982  Strikes and demonstrations occur daily, but at great risk  Labor laws permits trade union to lead workers from workplace in event of unsafe conditions  However, unions legally required to mediate dispute and resume production as quickly as possible  Draft local regulations beginning to regulate strikes Mary Gallagher, 2010

 ACFTU has gained increased power over the past few years but this power does not extend to the firm level.  ACFTU-directed unionization is part of the government’s attempt to stave off labor unrest  ACFTU unionization also garners large financial gains to the union (2% of wage bill)  Local trade union officials are appointed and financed by local party/state  Trade union activities are dependent on local political support  Local political leaders still appointed and evaluated based on economic growth targets Mary Gallagher, 2010

 Since January 2008, labor disputes have doubled or tripled as workers make use of new labor laws  Percentage of arbitrated suits going to litigation exceeds 50% in major cities.  Collective labor disputes often accompanied by work actions.  Employees, especially urban employees, are more aware of their legal rights. Mary Gallagher, 2010

 Wage increases and labor conflict are likely to continue, especially on the coast and in foreign-invested enterprises  Employers will spend more time and resources on human resource management; both to retain needed workers and to manage disputes  Inland investment will increase; but labor challenges exist there as well, including supply of well-educated and highly skilled employees  Government’s plan to strengthen collective wage bargaining is an attempt to manage wage pressures and to reduce instability in the context of continued central gov’t support for wage increases  Those attempts will be weakened by regional competition for investment and by the institutional barriers of the ACFTU Mary Gallagher, 2010