Labor Strike in China

[shenzhen]

Here is some info at KFC wage increase in Liaoning province.

 

http://www.chinadaily.com.cn/china/2010-06...ent_9951707.htm

 

And here is some food for thought of muti-nationals in China:

 

She said the company with 2,000 employees on its payroll has agreed to set a minimum wage at 900 yuan ($131.7) a month instead of the previously offered 700 yuan, and maintain an annual pay raise of 5 percent.

 

It is a shame the world's largest restaurant company insists of the city's minimum wage level of 700 yuan," said Feng, the union official.

 

However in another northeastern china province I know for a fact that one of the world leading speciality chemical companies pays beginning chemical plant operators 900 RMB/month not including overtime.

 

Does anyone here think that in the USA or Europe the chemical operators get paid about the same as the fast food employees? Does anything think they should?

[GDBILL]

Here is some info at KFC wage increase in Liaoning province.

 

http://www.chinadaily.com.cn/china/2010-06...ent_9951707.htm

 

And here is some food for thought of muti-nationals in China:

 

She said the company with 2,000 employees on its payroll has agreed to set a minimum wage at 900 yuan ($131.7) a month instead of the previously offered 700 yuan, and maintain an annual pay raise of 5 percent.

 

It is a shame the world's largest restaurant company insists of the city's minimum wage level of 700 yuan," said Feng, the union official.

 

However in another northeastern china province I know for a fact that one of the world leading speciality chemical companies pays beginning chemical plant operators 900 RMB/month not including overtime.

 

Does anyone here think that in the USA or Europe the chemical operators get paid about the same as the fast food employees? Does anything think they should?

 

 

Apples and oranges.

 

The overwhelming majority of industrial workers in China have little to no education and even less real-world skills to bring to the table while those who labor at KFCs are usually university students or those starting to get along in years that have work experience.

 

There's also the time-honored principle of supply and demand. It is extremely difficult to retain quality staff at fast food establishments while staffing in industry is relatively easy.

 

I pay our "aiyi" double what I pay our typical factory worker. If I paid each what they were, relatively speaking, worth the "aiyi" would get 3 or 4 times more than the laborer.

 

Applying Western standards to Chinese reality is often like trying to force a square peg into a round hole.

[shenzhen]

Here is some info at KFC wage increase in Liaoning province.

 

http://www.chinadaily.com.cn/china/2010-06...ent_9951707.htm

 

And here is some food for thought of muti-nationals in China:

 

She said the company with 2,000 employees on its payroll has agreed to set a minimum wage at 900 yuan ($131.7) a month instead of the previously offered 700 yuan, and maintain an annual pay raise of 5 percent.

 

It is a shame the world's largest restaurant company insists of the city's minimum wage level of 700 yuan," said Feng, the union official.

 

However in another northeastern china province I know for a fact that one of the world leading speciality chemical companies pays beginning chemical plant operators 900 RMB/month not including overtime.

 

Does anyone here think that in the USA or Europe the chemical operators get paid about the same as the fast food employees? Does anything think they should?

 

 

Apples and oranges.

 

The overwhelming majority of industrial workers in China have little to no education and even less real-world skills to bring to the table while those who labor at KFCs are usually university students or those starting to get along in years that have work experience.

 

There's also the time-honored principle of supply and demand. It is extremely difficult to retain quality staff at fast food establishments while staffing in industry is relatively easy.

 

I pay our "aiyi" double what I pay our typical factory worker. If I paid each what they were, relatively speaking, worth the "aiyi" would get 3 or 4 times more than the laborer.

 

Applying Western standards to Chinese reality is often like trying to force a square peg into a round hole.

I hear what you are saying but you are are also mixing apples/oranges and missing my point. I am not talking about operators in a garment factory.

 

In the west we usually employ chemical plant operators after extensive training/testing (they maybe only have a HS degree but they have to establish an ability in math/science to even get into the hiring pool) and we have extensive control control/safety systems. Here in China we employ people with less education and training than those at KFC. One of the main reasons for this is because of the low pay the chemical companies want to provide their operators. From a safety standpoint something is amiss here when one compares China to the West.

[knloregon]

In any case, this story---discussed here for nearly a week, is now on Page One of this morning's print version of The Wall Street Journal:

 

"Chinese Workers Win Wave Of Raises"

[Stepbrow]

I wonder if there is any significance to the fact that both companies are foreign, that is, not Chinese ?

[shenzhen]

I wonder if there is any significance to the fact that both companies are foreign, that is, not Chinese ?

The stand-alone/wholly owned international businesses in China are always held to a different standard. International Joint Ventures may or may not be held to different standard depending upon the status and connections of the JV partner and whether the majority partner is internation or domestic.

 

Also it is politics as usual. Same as the US politicans using Chinese imports/trade imbalance as scapegoat for its problems.

 

However it seems the rise in labor costs will be China-wide but analysts predict it will not cause manufacturing to leave China:

 

http://www.chinadaily.com.cn/china/2010-06...ent_9960302.htm

http://www.chinadaily.com.cn/china/2010-06...ent_9958014.htm

[shenzhen]

Apple's Steve Jobs says ""Foxconn is not a sweatshop. You go in this place and it's a factory but, my gosh, they've got restaurants and movie theaters and hospitals and swimming pools. For a factory, it's pretty nice."

 

http://news.xin.msn.com/en/sci-tech/articl...umentid=4124640

 

Two reports on the complex:

http://www.cultofmac.com/inside-foxconn-fa...ge-campus/45199

 

http://www.dailytech.com/Employees+at+Appl...rticle18624.htm

[Randy W]

From Wikipedia:

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

Dongfeng Honda Automobile Co., Ltd. (¶«·ç±¾ÌïÆû³µÓÐÏÞ¹«Ë¾) is a joint venture between the Dongfeng Motor Corporation and Honda Motor Company. It produces the Honda CR-V for sales in China.

The plant is located in Wuhan, in the central province of Hubei. The current facility is 50,000 square metres and employs 930 workers. The new expansion in 2008 will increase the plant size to 181,000 square metres and total work force of 2,800.

 

The 50-50 joint venture was established in 2003 for US$ 98 million in capital.

Another plant in Guangzhou, Guangdong province is operated by Honda Automobile (China) Company, which is a separate joint-venture (55% Honda, 25% Guangzhou Auto Group, 10% Honda Motor China Investments, and 10% Dongfeng Motor Group), and produces 240,000 vehicles annually, primarily for export.

 

Toyotas (and I believe Volkswagen and Mitsubishis) are produced by FAW

FAW Group Corporation (simplified Chinese: µÚÒ»Æû³µ¼¯ÍÅ; traditional Chinese: µÚÒ»Æû܇¼¯ˆF; pinyin: D¨¬y¨© Q¨¬ch¨¥ J¨ªtu¨¢n) is a state-owned enterprise with publicly-traded subsidiaries: FAW Car Company (SZSE: 000800), Tianjin FAW Xiali Automobile Co Ltd (SZSE: 000927) and Changchun FAWAY Automobile Components Co Ltd (SSE: 600742). A maker of automobiles; buses; light, medium, and heavy-duty trucks;[1] and auto parts,[2] FAW became China's first automobile manufacturer when it unveiled the nation's first domestically-produced passenger car, the Hong Qi, in 1958.[3]

 

As of 2009, FAW is the largest machinery corporation[4] and the second largest auto manufacturer in China.[5]

 

FAW has its headquarters in Changchun, a tree-lined city on the northeastern Songliao Plain

In 1953, the first year of the first five-year plan,[8] First Automobile Works broke ground for its first factory . . . In 1992, the name First Automobile Works was changed to China FAW Group Corporation.

FAW sells products under at least ten different brands, including its own. These include Besturn, established on August 18, 2006,[17] Huali, Shenli,[18] Pengxiang,[19] Dario,[20] Yuan Zheng,[21] Xiali[20] and the much older Hong Qi (meaning "Red Flag"[10]) and Jie Fang. Its foreign joint ventures also manufacture General Motors, Toyota,[20] Audi and Volkswagen-branded vehicles for sale in China.

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

 

I believe the applicable Chinese policy is that cars for the domestic market must be manufactured by primarily Chinese companies.

 

Also that each joint venture has their own manufacturing facilities, under the direction of the foreign partner.

Edited June 10, 2010 by Randy W (see edit history)

[GDBILL]

Here is some info at KFC wage increase in Liaoning province.

 

http://www.chinadaily.com.cn/china/2010-06...ent_9951707.htm

 

And here is some food for thought of muti-nationals in China:

 

She said the company with 2,000 employees on its payroll has agreed to set a minimum wage at 900 yuan ($131.7) a month instead of the previously offered 700 yuan, and maintain an annual pay raise of 5 percent.

 

It is a shame the world's largest restaurant company insists of the city's minimum wage level of 700 yuan," said Feng, the union official.

 

However in another northeastern china province I know for a fact that one of the world leading speciality chemical companies pays beginning chemical plant operators 900 RMB/month not including overtime.

 

Does anyone here think that in the USA or Europe the chemical operators get paid about the same as the fast food employees? Does anything think they should?

 

 

Apples and oranges.

 

The overwhelming majority of industrial workers in China have little to no education and even less real-world skills to bring to the table while those who labor at KFCs are usually university students or those starting to get along in years that have work experience.

 

There's also the time-honored principle of supply and demand. It is extremely difficult to retain quality staff at fast food establishments while staffing in industry is relatively easy.

 

I pay our "aiyi" double what I pay our typical factory worker. If I paid each what they were, relatively speaking, worth the "aiyi" would get 3 or 4 times more than the laborer.

 

Applying Western standards to Chinese reality is often like trying to force a square peg into a round hole.

I hear what you are saying but you are are also mixing apples/oranges and missing my point. I am not talking about operators in a garment factory.

 

In the west we usually employ chemical plant operators after extensive training/testing (they maybe only have a HS degree but they have to establish an ability in math/science to even get into the hiring pool) and we have extensive control control/safety systems. Here in China we employ people with less education and training than those at KFC. One of the main reasons for this is because of the low pay the chemical companies want to provide their operators. From a safety standpoint something is amiss here when one compares China to the West.

 

You must be confused or need to have your vision tested. Who is talking about garment workers?

 

I employ somewhere north of 15k individuals here and approximately 2/3 of them are in petro-chemical factories. An extremely low turnover rate coupled with the fact that our major competitor is a state-owned company means we couldn't find industry experienced new-hires if we wanted to. In spite of that we start pay at the industry average in China of approximately 1.1k RMB basic salary -- and we beat new applicants away with a stick.

 

To remain price competitive, labor costs are tightly controlled. Fortunately supply and demand assists in the endeavor. We do not hire university graduates as general plant operators because unless you hire the best and the brightest from quality schools, you basically end up with a moron with an attitude who thinks they are Einstein compared to a HS graduate (or less) who has no attitude and is trainable. Who in their right mind would think to apply this concept to petro-chemical plants in the US?

 

Safety is always a concern, but our safety record here is running far ahead of our plants in the US. Part of the reason is that we break down one job position into three or four (which is extremely common in China) so no one individual works above their capacity. Foremen here have fewer people to supervise than in the States. So your theory of safety suffering because of the disparity in worker quality just flew out the window, too.

 

On a side note, the government has started informing companies that we should expect labor costs to increase about 35% over the next few years. We're not too worried about that.

[shenzhen]

Here is some info at KFC wage increase in Liaoning province.

 

http://www.chinadaily.com.cn/china/2010-06...ent_9951707.htm

 

And here is some food for thought of muti-nationals in China:

 

She said the company with 2,000 employees on its payroll has agreed to set a minimum wage at 900 yuan ($131.7) a month instead of the previously offered 700 yuan, and maintain an annual pay raise of 5 percent.

 

It is a shame the world's largest restaurant company insists of the city's minimum wage level of 700 yuan," said Feng, the union official.

 

However in another northeastern china province I know for a fact that one of the world leading speciality chemical companies pays beginning chemical plant operators 900 RMB/month not including overtime.

 

Does anyone here think that in the USA or Europe the chemical operators get paid about the same as the fast food employees? Does anything think they should?

 

 

Apples and oranges.

 

The overwhelming majority of industrial workers in China have little to no education and even less real-world skills to bring to the table while those who labor at KFCs are usually university students or those starting to get along in years that have work experience.

 

There's also the time-honored principle of supply and demand. It is extremely difficult to retain quality staff at fast food establishments while staffing in industry is relatively easy.

 

I pay our "aiyi" double what I pay our typical factory worker. If I paid each what they were, relatively speaking, worth the "aiyi" would get 3 or 4 times more than the laborer.

 

Applying Western standards to Chinese reality is often like trying to force a square peg into a round hole.

I hear what you are saying but you are are also mixing apples/oranges and missing my point. I am not talking about operators in a garment factory.

 

In the west we usually employ chemical plant operators after extensive training/testing (they maybe only have a HS degree but they have to establish an ability in math/science to even get into the hiring pool) and we have extensive control control/safety systems. Here in China we employ people with less education and training than those at KFC. One of the main reasons for this is because of the low pay the chemical companies want to provide their operators. From a safety standpoint something is amiss here when one compares China to the West.

 

You must be confused or need to have your vision tested. Who is talking about garment workers? -- You said industrial workers not petro-chemical workers. Since my experience differs quite a lot with yours I assumed you must have been talking about the average industrial worker. You should have been more specific. Try just once to lose the attitude and have a discussion when you disagree with what someone writes BASED on their experience.

 

I employ somewhere north of 15k individuals here and approximately 2/3 of them are in petro-chemical factories. An extremely low turnover rate coupled with the fact that our major competitor is a state-owned company means we couldn't find industry experienced new-hires if we wanted to. In spite of that we start pay at the industry average in China of approximately 1.1k RMB basic salary -- and we beat new applicants away with a stick. --- We had 50% turnover in the first year and have had anywhere from 5-15% the succeeding years. Same experience as others in northeast China. We also could not find experienced new hires but mainly because of our location and pay scale.

 

To remain price competitive, labor costs are tightly controlled. Fortunately supply and demand assists in the endeavor. We do not hire university graduates as general plant operators because unless you hire the best and the brightest from quality schools, you basically end up with a moron with an attitude who thinks they are Einstein compared to a HS graduate (or less) who has no attitude and is trainable. Who in their right mind would think to apply this concept to petro-chemical plants in the US? -- I never said we hired university graduates in our chemical plants in the US. I said that "they maybe only have a HS degree but they have to establish an ability in math/science to even get into the hiring pool" ... this means that even though they only have a HS degree with look for people with an ability in math/science.

 

Safety is always a concern, but our safety record here is running far ahead of our plants in the US. Part of the reason is that we break down one job position into three or four (which is extremely common in China) so no one individual works above their capacity. Foremen here have fewer people to supervise than in the States. So your theory of safety suffering because of the disparity in worker quality just flew out the window, too. -- We too have 3-5 people for every one person in the USA and our supervisors also have less people reporting to them. This does not mean that worker quality has no impact on safety. All it takes is one bone-head act (open/close the wrong manual valve) for an incident to occur. Also we have more workers in China than in the US because our plants are less automated including safety automation (you must have missed this part of my theory as you call it). I would love to see the actual stats that prove your safety record in running ahead of the plants in the US and ensure you are actually comparing apples to apples with the safety stats. BTW - it is not my theory but rather my and other expat's in the northeast of China experience.

 

On a side note, the government has started informing companies that we should expect labor costs to increase about 35% over the next few years. We're not too worried about that.

[knloregon]

Well, it was my theory----a number of months ago (as I posted) that Bill and Alan probably had more in common than they knew...

 

......seems to be reenforced here, and these are both good posters giving good, on the ground info.... so maybe a little more constructive in the tone?