generalspeaking

Life's A Treasure

And so it must be treasured. That is the message that Foxconn has decided to deliver to its vast workforce. One wonders whether Mao Tse Tung had the requisite wisdom of the times to deliver that profound message in his celebrated, must-treasure Little Red Book. Foxconn, the giant manufacturing company with a huge roster of clients all over the world, has had reason to worry of late. Somehow, despite their best efforts at presenting as sterling employers, there remain a sad contingent of suicide-seeking employees.

Young people who feel adrift from their roots, who miss their families, who have been encouraged to travel far from their homes to find employment in a huge metropolis where they find themselves confused and lonely and with no outlet for their sad inability to adjust to a new reality. Of course, there have been rumours that the young workers feel exploited, having to work too-long hours, with no interruptions in their working hours permitted.

Party time. Throughout China, wherever Foxconn facilities are present to house their hundreds of thousands of workers in industrial production that supplies Apple and Dell and Nokia among others, the message is upbeat: "Treasure your life, love your family, care for each other to build a wonderful future..."

A new Foxconn installation is being planned to house another 200,000 workers. Those are gigantic facilities, with a workforce the size of small cities. The company plans to seek "socially mature" employees; hopeful avoidance of future suicides by emotionally immature young people, finding adjustment to their new reality too stressfully daunting.

The giant Shenzhen campus where an approximate 400,000 are employed does have its amenities as befits a small city. The campus boasts sleek and modern well-run factories, and bakeries, banks, employee apartments, acupuncture clinics, and fast-food shops. And now it also hosts costume parties, enthusing its employees with an appreciation for life beyond the factory floor. Workers fitted out in dress costumes, clapped and cheered, listening to music.

"Foxconn feels it's perhaps time to look back and to learn from the tragedies and to send an important message to their employees that they are not alone, and that the Foxconn family is there to support them and to help them through their challenges" was the company's statement, post-worker suicides. The vast army of migrant workers finding employment in China's huge urban centers represent a great natural resource to be exploited in China's march to world economic-and-production domination.

The company has taken to urging workers to sign contracts promising not to dispose of their lives. Now that is one interesting way to introduce potential new recruits to industrial life, infusing them with a sense of bewildered confliction; you will be employed as long as you vow to remain in the land of the living. What kinds of stress could conceivably convince one to commit suicide in this work environment, the new recruits might muse to themselves...?

And the overwhelming sight of that vast array of buildings being enveloped in safety nets, enough of them to cover 450 football fields...what kind of confidence does that build in peoples' minds? Preventive strategy, obviously, but why would it be required? On the other hand, wages have been increased by 122% since Apple made its anxious enquiries via a legal investigation.

Now, a planned two thousand retail stores soon to be opened, offering name-brand consumer electronic products, operated by Foxconn, throughout China. Not a bad move, considering the state of world affairs, with a noted decrease in purchasing power globally thanks to the ongoing struggle to advance completely out of the international recession.

Chinese wages have increased in manufacturing from $1,000 to $4,000 annually over the last ten years. The competitive advantage is being watered down. But Foxconn continues to rack up huge revenues; how does $5.04-billion each month sound? Reflecting the continuing strong demand in the electronics market world-wide.

Still, because of the growing wage scale in China, the likelihood of even greater industrial wage increases, and the higher transport costs, profit margins for offshore companies using China as their manufacturing base is eroding. General Electric for one has plans to shift production back to Kentucky. Scoring an improbable lower wage agreement from workers in the U.S.

As wage scales continue to rise in the industrial hubs of the Pearl River and Yangtze River deltas, thanks to disputes at Foxconn, Honda,Toyota and Omron, a narrowing pay gap emerges, along with the attraction of lower transport costs and shorter delivery times. More foreign companies will begin to return to their original geographies for manufacturing, leaving China to continue its giant manufactories, but increasingly for home consumption.

And increasing costs in the production of primary metals and other industrial needs imported from abroad will impact on China's production costs, further eroding their price advantage. Credit Suisse conducted a recent survey indicating that over 50% of foreign companies located in China may contemplate relocating their plants to lower-wage regions like Bangladesh, Vietnam or Indonesia.

China is in the process of seeing a slow-down in their rush to world-production domination.

Labels: China, Economy, Traditions, Troublespots

posted by Pieface @ Thursday, August 19, 2010