Foxconn Increases Wages, Raises Pay By 16-25% For Chinese Workers - TechCrunch

[grahamhgreen]

"The company just released a statement indicating pay raises for Chinese workers just before the Fair Trade Association is set to interview employees about life at Foxconn.

The base pay of junior level worker in Shenzhen is now at 1,800 yuan ($290) per month and, if the worker passes a technical examination, it will be raised to 2,200 yuan. Three years ago the base pay was just 900 yuan per month."

http://techcrunch.com/2012/02/17/foxconn-increases-wages-raises-pay-by-16-25-for-chinese-workers/

[Historic NY]

1. Guess they are learning where the Greeks haven't.....

happy workers with money spend things that make the economy grow...wait what about US (us).

[denverbill]

4. No, I don't think they are learning that at all.

They are learning that if you don't stop treating your workers like absolute shit you'll be fired.

I'm sure the raises will last about as long as the inspection team is there.

[Blue_Tires]

8. They are learning to toss a few crumbs off the table to offset all the bad PR

...

[onehandle]

2. Apple is the only tech company that has joined the Fair Trade Association.

Foxconn is trying to get out ahead of the inspections.

Where's Google? HP? Dell? Amazon? Samsung? Asus? Microsoft? Any of the dozens of other companies that use the same workers as Apple?

[think]

3. +1

[Uncle Joe]

7. +2 n/t

[Wait Wut]

9. Yep.

The rest will be along soon enough. After Apple has paved the way...again.

[we can do it]

11. +3

[harun]

13. It's a great start.

[joshcryer]

23. The pressure on Apple made this happen. Anyone saying otherwise is not thinking.

If it wasn't for Apple, the most profitable Foxconn contractor, being pressured, no progress would be made.

Since the pay raise is across the board, thanks to the pressure on Apple, and the criticism of Apple, the workers who make Asus boards will have 'better' conditions.

Instead of Apple getting credit, the people who put pressure on Apple should get the credit.

[Uncle Joe]

27. Then why hasn't pressure been placed on the other tech companies?

Are they to be given a free pass?

Apple didn't have to listen to said pressure, apparently they've been quite successful regardless.

To deny giving Apple some measure of credit for listening to the people "is not thinking."

[joshcryer]

30. Because Apple is the most profitable. It wouldn't even make a blip in the media...

...if someone went after some obscure company like ASrock. People don't even know who ASrock is, it's mainly a motherboard manufacturer.

Compare ASrock's revenue to Apple:

ASrock: http://www.bloomberg.com/quote/3515:TT

Market Cap: 12 billion
Value: 9 billion

Apple: http://www.bloomberg.com/quote/AAPL:US

Market Cap: 468 billion
Value: 370 billion

What? We're going to stand outside of the office of ASrock protesting and completely ignoring Apple's overwhelming hegemony on Foxconn produced stuff?

Really?

Apple deserves no credit, none. They are a multinational corporation that exploits slave labor and uses mass friendly consumerism coercion to get people to defend them and use false equivalence over and over again.

Right? I mean, you can’t, right, you can’t, you’re not allowed. “Why would you ever need to boot an Apple box from a USB key?” “You don’t need any software except the software he gave you.”, right? Nobody has yet fully documented what everybody who isn’t part of the cult understands, which is that nobody has ever had more contempt for customers than Mr. Jobs. Nobody.

[Uncle Joe]

31. Are you trying to tell me that Microsoft, Amazon, Hewlett Packard etc etc. wouldn't make a blip?

"Less than a month ago, the Times ran a damning account of working conditions at the Foxconn factory. Although the company's suicides and potentially hazardous work environments have been covered for years, this was the powder keg that launched a very public backlash against Apple and sparked an independent investigation. As you may expect, Apple was probably none-too-pleased about the way the paper specifically called it out in the headline -- despite the fact that Foxconn manufactures products for Microsoft (MSFT), Amazon (AMZN), Hewlett-Packard (HPQ), and many other companies."

Read more: http://www.minyanville.com/dailyfeed/2012/02/17/apple-exposes-bitter-grudge-with/#ixzz1mm5PwalU

[joshcryer]

32. Miscrosoft was called out hard over the 360 suicide threats.

Amazon only has a penetration of a few million people, as far as Kindle is concerned (they sell their Kindle Fire at cost because they make more money from digital book sales), HP is a niche, Wal-Mart-style computer, which isn't present to any significant degree in the consumer psyche.

1) Apple is most profitable
2) Apple is most recognizable
3) Apple is most trendy
4) Apple is most profitable
5) Apple is most profitable

The criticism on Apple worked, didn't it? The pay raise was across the board. Apple was the only of those companies to make any effort to change the situation (again, because of the pressure). Because of that now Foxconn is acting.

Though I don't expect much to change, it's still more effective that the most profitable, most exploitive company be tasked to change it, as opposed to smaller, niche players who do not have the same penetration into mass consumer thought.

[Uncle Joe]

33. Is FOXCONN's suicide rate lower than China's average?

http://www.forbes.com/sites/davidthier/2012/02/10/why-does-apples-manufacturing-bother-us-so-much/

"As Tim Worstall has pointed out, there’s nothing particularly noteworthy about Foxconn’s manufacturing in China, or Apple’s relationship with it. Oppressive conditions are par-for-the course over there, and Foxconn actually has a slightly lower suicide rate than China writ-large. and any electronics company worth their salt does their manufacturing in similar conditions: it’s the game they all play, and it’s the game we demand when we ask for cheap electronics.

And yet, there were no Microsoft protests yesterday, no Samsung protests or Nokia protests. Apple continues to receive the brunt of public fury over Chinese manufacturing conditions. Why?"

[joshcryer]

34. I'm not making any statement about the suicides.

I'm saying Microsoft got a lot of criticism over the call for suicides.

Are you one of those people who defended Microsoft, too?

Did you go out and show the famous "list" only exchanging Microsoft's name on that list with Apple?

Please.

[Uncle Joe]

35. Do you have a link of Microsoft getting hammered because virtually everything I've seen has been

almost exclusively focussed on or tying Apple to this.

You have said Apple shouldn't be given any credit for listening to the people or positively reacting to the pressure

My point is if you can't give them credit when they do right or correct themselves whether pressured or not, you make no distinction between progressive companies trying to do better and those corporations that simply don't give a rat's ass.

[joshcryer]

38. They get credit when they stop the labor practices completely.

They can get credit for "listening to the pressure" but that's a subset of "pressuring Apple."

Meanwhile, Microsoft nipped it in the bud quickly, and they didn't have a Mike Daisey focusing solely on them:

http://www.pcworld.com/businesscenter/article/247984/microsoft_investigates_worker_protest_at_foxconn_factory_in_china.html

http://www.theatlanticwire.com/technology/2012/01/foxconn-still-hard-place-work/47193/

http://www.huffingtonpost.co.uk/2012/01/11/microsoft-investigating-mass-suicide-at-foxconn-plant_n_1198860.html

Finally:

http://www.cultofmac.com/139999/microsoft-and-foxconn-end-dispute-at-xbox-plant/

http://thenextweb.com/microsoft/2012/01/12/microsoft-claims-that-the-foxconn-labor-dispute-has-been-settled/

Microsoft nipped it in the bud by paying 'em off. Of course, we don't praise Microsoft for that, we don't credit Microsoft for that, because the labor practices still exist.

As a gamer, I followed the Microsoft thing closely and I was shocked with how quick it disappeared from the news. In the gaming community it was a one-two day thing and then poof, gone. But while it was on the news there were die hard "Xbox fanboys" who used these exact same, tired, bullshit justifications for these labor practices. I denounced it with Microsoft, and I denounced it with Apple. In fact, some "Apple fans" posted on DU about the Xbox problems, it would be interesting to go back and look at those discussions.

[Uncle Joe]

39. Who did Microsoft payoff?

From what I could tell the resigned workers were never compensated.

"Instead of the raise they requested, these workers were given the following ultimatum: quit with compensation, or keep their jobs with no pay increase. Most quit and never got the money. That's when the mass suicide threat came in. The incident actually caused a factory wide shutdown, reports Record China."

http://www.theatlanticwire.com/technology/2012/01/foxconn-still-hard-place-work/47193/

[joshcryer]

40. I personally don't think that's what happened.

I think Microsoft paid them off because we didn't hear a peep from that group since then.

Either that or something more sinister happened to them.

[madrchsod]

5. well there`s always vietnam and burma for cheaper labor...

[Uncle Joe]

6. Kicked and recommended.

Thanks for the thread, grahamhgreen.

[xxqqqzme]

10. $290/mo

What's that? $1/hr?

[Uncle Joe]

12. Whatever it works out to be, it's a step up for them. To take a spin on Einstein, it's all relative.

“As a top manufacturing company in China, the basic salary of junior workers in all of Foxconn’s China factories is already far higher than the minimum wage set by all local governments,” the statement said. “We will provide more training opportunities and learning time, and will continuously enhance technology, efficiency and salary, so as to set a good example for the Chinese manufacturing industry.”

"Foxconn is often viewed as a good entry-level job in China. The work is hard, no doubt, but the pay is fair for the region and job seekers often line up by the thousands for a chance to work at Foxconn. Not only is the pay a good deal higher than the required minimum but the company also provides dorms, meals, and recreational facilities for its workers. Foxconn is viewed as a way to move from the fields to the city."

[grahamhgreen]

15. According to this site, it costs 1,500 Yuan for a decent apartment in Shenzen, so it's

still not a lot of money.... Not enough to buy a house.



Living/work
rent house, 50m2 - 2.000Y/month
rent house, 100+m2, good location - 8.000Y/month
buy house (normally 70-150m2) - 7-25K RMB/m2

utility (electricity, water, management) - 200/month
internet 2MB ADSL - 1440Y/year

native english teacher, fulltime - 10.000+Y/month *see note below
taxi 5 km (start 12.5) - 20
bus/subway - 2-5/trip

http://www.startinchina.com/shenzhen/life/cost_of_living_in_shenzhen.html


But the real problem is that American workers are supposed to compete with these wages. That is impossible.

We must end these costly trade agreements IMHO.

[Uncle Joe]

17. According to the OP, I assumed their housing and meals were covered.

"Foxconn is often viewed as a good entry-level job in China. The work is hard, no doubt, but the pay is fair for the region and job seekers often line up by the thousands for a chance to work at Foxconn. Not only is the pay a good deal higher than the required minimum but the company also provides dorms, meals, and recreational facilities for its workers. Foxconn is viewed as a way to move from the fields to the city."

I agree, American Workers can't compete with those low wages.

As to the trade agreements, what would be the alternative reality should they be scrapped?

[grahamhgreen]

18. The alternative would be the way it used to work in America,

Goods produced overseas were taxed to the point where American businesses can compete.

Those taxes are used to run the federal government, and to subsidize American businesses.

Thom Hartmann has a great article about this here: http://www.commondreams.org/view/2008/12/17

[Uncle Joe]

19. Alexander Hamilton, Lincoln and every President up until a quarter century after WWII

had a major advantage affecting their considerations, the West dominated the Industrial Age as that's where it was born beginning durig the middle to late 18th century in Europe followed by the U.S.

Those taxes used to run the federal government and subsidize businesses were easier to maintain when so much of the world was undeveloped and having few places to turn for needed commodities; whether it be manufactured or agriculture.

http://en.wikipedia.org/wiki/The_Industrial_Age

That dyanmic started to change as more nations came on board the Industrial Revolution Train in Asia, South America and Africa during the middle to late 20th century. The U.S. still domiinated for decades after WWII because so much of the developed world had been blown to the Stone Age.

Chomsky has a good analysis on this thread as to how the U.S. controlled 50% of the world's wealth at the end of WWII, today we still have a dominant positiion but it's only 25%

http://www.democraticunderground.com/101614303

If we raised taxes on imports from newly developed Industrial Nations, would they do the same to us?

Whether the answer is yes or no what would the affect be?

What would happen to imports and exports along with prices of much needed goods here at home?

[Amonester]

22. Easy answer: Retail prices would go up significantly.

That would result in less sales, less polution, less worthless shiny-object gimmicks, less profits for the top 1%.

[joshcryer]

24. +1

[Uncle Joe]

26. The keywords were much needed goods, not "shiny object gimmicks,"

If retail prices went up here, and exports dropped wouldn't that create downward pressure on employment here at home as prices increased for those goods, raising unemployment?

If other nations of the world maintained their trade agreements while the U.S. withdrew, would the dollar stop being the primary currency of the world?

If the dollar stopped being the primary currency and was dramatically devalued, would prices here at home increase even more?

As our exports and imports dropped because of increased tariffs between us and other nations, and our systems become more closed would entropy set in quicker?

If entrophy; ie poverty, chaos sets in quicker would pollution increase as fewer people and businesses could afford to switch over to more energy efficient, sustainable means, ie; older cars on the road for longer periods of time, fewer homes able to insulate or convert etc etc.?

If prices dramatically increased as unemployment soared, would the 1% have even more power over the people?

[grahamhgreen]

28. In all, the USA would raise it's standard of living and quality of life.

If retail prices went up here, and exports dropped wouldn't that create downward pressure on employment here at home as prices increased for those goods, raising unemployment?

- I believe that retail prices may not rise at all as the cost of "cheap" Chinese goods have ALREADY bloated back to where they were before we outsourced. Profits, however, may decrease to more reasonable margins.

If other nations of the world maintained their trade agreements while the U.S. withdrew, would the dollar stop being the primary currency of the world?

- I do not expect that they would maintain them.

If the dollar stopped being the primary currency and was dramatically devalued, would prices here at home increase even more?

- I actually think the dollar would strengthen, and I think that prices would stabilize here, the economy would resemble what we had in the 40's - 70's.

As our exports and imports dropped because of increased tariffs between us and other nations, and our systems become more closed would entropy set in quicker?

- No, I think this would re-ignite the kind of dynamism that America is known for. More money would be available for the kids of highly paid workers to tinker together projects in their garages that become multi billion dollar entities.

If entrophy; ie poverty, chaos sets in quicker would pollution increase as fewer people and businesses could afford to switch over to more energy efficient, sustainable means, ie; older cars on the road for longer periods of time, fewer homes able to insulate or convert etc etc.?

-No, I believe that alternative energy production would be one of the drivers of the post-costly-trade agreement world.

If prices dramatically increased as unemployment soared, would the 1% have even more power over the people?

-Unemployment would plummet as the factories come home, of that you can be certain.

[Uncle Joe]

29. In the 40s to the 70s we dominated the world because either

the other nations were blown to hell from WWII having no industrial base, hadn't significantly entered the Industrial Age to begin with or were behind the Iron Curtain, that's why the dolllar was so strong.

If we raised tariffs on other nations, what motivation would China, India or the EU have for raising tariffs on each other?

It's seems to me those nations would be both more motivated and enabled to fill the demand vacuum created by the U.S. absence.

If they were trading among themselves while we were cut out, the dollar would lose much of its' international signifigance or reason for being the preeminent currency.

Their economies or systems not being as closed as the U.S. would thus be more dynamic while we accelerated entrophy here at home falling further behind, along the lines of the old Soviet Union and their closed system.

Why would the factories come home if they have a more lenient playing field abroad?

I suspect more of their headquarters would migrate to other nations.

[grahamhgreen]

41. Good points, but I must respectfully disagree

The sad fact is that we must return jobs here or the country as a whole will continue to suffer. Americans can not compete with Chinese labor. There is no way that an American worker can live on the 2 or 300 dollars a month that they make in China. Wages are falling. The result of wage deflation could be truly disastrous for those that have assets based in this country. Housing prices are falling in part due to wage deflation already, who knows where it will end.

This reminds me of a software developer I met in Samui who was complaining because all of his jobs were being lost to Argentina where the coders were making half the Indian rate!

You mention headquarters moving. For me, I think if the companies that are outsourcing our jobs moved to other countries, that would be of great benefit to us. Instead of outsourcing our jobs, WE would be outsourcing THEM! If they want access to the demand created by our high paid workers, they would have to pay us for the privilege. Getting rid of these job-outsourcers who are corrupting our government, banks, and everything America stands for, would be the best thing that ever happened to us, IMHO, they are the problem. We can make shoes and everything else right here. We can afford to pay $10 more for a pair of shoes or an iPhone so that our relatives can afford to send their kids to college, especially if we have jobs.

You bring up a good point - "what motivation would China, India or the EU have for raising tariffs on each other?" I believe they already do, I know that they charge a high tariff on any imported textiles, while they pay almost nothing to export to the US.

Why would the factories come home? For the same reason they left - with the tariffs, it would become cheaper to produce the products here.

Anyway, i doubt we will agree on this, but I think we are far along the path you are prescribing, and our country is hurting. Perhaps as we slide further into the abyss you will take some of these ideas to heart.

I don't see where our jobs will come from if we don't produce goods at home, even if we get another Steve Jobs, the jobs will just go overseas. But especially, I don't see any evidence that these costly trade agreements have made things better for the average American, in fact I see the situation worsening daily.

[Uncle Joe]

42. I wish the prognosis was different as well but I only see two likely outcomes and

they're both painful.

1. We adapt to the changing Industrialized world by investing, that does mean the creation of jobs in other nations by our corporations,

We've been the primary consumer but I believe that's changing and FOXCONN's recent actions are a microism of the changes taking place overseas as their salaries have doubled over the past three years far outstripping pay increases in the U.S. I believe that trend will continue.

Their workers will demand better wages, work hours and conditions as their lot improves and their consuming of product wll increase as well, in short Chinese Labor won't be able to compete with Chinese Labor.

I do believe the Chinese Government has been keeping the yuan aritificially low to the dollar but they can only do that for so long.

Second scenario

2. Nations retrench, every nation for them self and most efficient use of labor ie: developing world is left to its' own device.

World population and pollution increases faster as developing world is left behind while the prospects for major war and environmental calamity increases as well.

As I stated at the beginning they're both painful but the former holds the prospect for global equalization or balance, not to mention longer term survival of the human species.

My conclusion is that humanity is coming to a tipping point, we've played the empire game for about four millennium, and I believe we need to quit pushing that boulder up the hill.

In the long term I see scenario #1 as actually increasing the chances of "workers of the world uniting" as that equalization comes to fruition. But for the time being human society is in its' teenage years now with some parts growing faster than others.

Peace to you, grahamhgreen.

[lovuian]

14. I'm happy for the Chinese Workers

this is Great news for them


I'm shocked at how Stupid these governments are

By giving workers good wages the economy will be good and prosper

It really is about the worker

[hedgehog]

20. "By giving workers good wages the economy will be good and prosper "

Do you suppose we will ever convince Republicans of that basic truth?

[Deep13]

16. That's fine and all, but the hours are still oppressive...

...and it is still a serious crime to unionize. As long as progress is dependent on the good will of the bosses, Chinese workers will never be free.

[JCMach1]

21. Now they are up to sweatshop levels

So good for them!

They will now finally make as much as Dubai construction workers.

[joshcryer]

25. But I was told the most profitable company isn't the only company that works with Foxconn...

...and we should criticize the other companies, not the most profitable one!

Doh! I am sure glad we didn't listen to that nonsense! Here's hoping for a pay raise of 6 times base pay (as I did the calculations and it would not make our shiny gadgets go up in cost by more than a few dollars at most).

They still work 16+ hours a day.

[woo me with science]

36. No, you were told that we should criticize all of the offenders,

Not JUST the most profitable one.

[joshcryer]

37. Yes, basic deflection.

If you can't criticize all of 'em you have no right criticizing the worst.

I've seen similar nonsense over whaling, because the Sea Shepard focuses mostly on Japan, they must then somehow advocate Icelandic whaling, etc, etc.

Your basic false equivalence.

[Neue Regel]

43. How about moving production of the iPad and iPhone to the US instead?

And pay the workers $25-$30 an hour?