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Gary Chaison: The workplace revolution arrives in China

01:00 AM EDT on Tuesday, July 6, 2010

By GARY CHAISON

WORCESTER

The recent auto workers’ strikes in China are evidence of a workplace revolution of tremendous political and economic importance. As Honda workers take to the streets and walk off their jobs in southern Chinese cities, their actions will soon be felt by employers and workers here in the U.S. What we are seeing is a changing of the order—a new empowerment of workers—that enjoy the quiet but vital support of their government.

Striking workers at Honda’s Chinese plants fight for higher pay and less arduous working conditions. After a successful two-week strike, workers returned to their jobs with much higher pay. Days later we hear about Chinese workers walking out at the company’s exhaust-system factory, and later, at an auto-parts plant.

What’s remarkable about these strikes? It’s not simply that they are happening at Honda, an automaker widely considered to be a benevolent employer, or at Foxconn, a huge Taiwanese-owned subcontractor of Honda. What I find remarkable is that they are happening at all.

China’s labor unions are notorious for being docile and controlled by the government. A few years ago, however, changes in labor laws appeared to give independent bargaining power to workers. This was a mirage — whatever power the unions and their members got is given to them by the state. So, while China has the worlds’ largest unions, it does so because this is acceptable to the central government. In the world of unions, size does not equal power or militancy, and China-based companies have long demonstrated this.

That the Chinese government would even permit strikes — independent and successful strikes — is a monumental move. Many of the strikers are rural workers drawn to huge factories in company-dominated communities. Their first industrial jobs raised their expectations of having a better life, one in which they have some control over their destiny. Now the government feels an obligation to see that those expectations are met. This seems to signal that China is adopting a two-stage policy — first we make the jobs available, then we ensure higher wages and job rights for workers in those jobs. In other words, first we become the world’s factory, then we ensure, albeit slowly, that we are a good factory.

The trade implications of these recent activities could be profound. China has a history of taking jobs away from higher paying labor forces, particularly those in the U.S. As Chinese workers receive higher wages and greater job rights, some of their jobs may slowly return to the U.S., or companies could locate in other low- wage countries, such as India, Cambodia or Vietnam. Only time will tell, but we can expect that American employers will now begin to have second thoughts about their ability to secure a docile and low-paid workforce in China.

Regardless of how many successful strikes there are in China, U.S. workers will still receive far greater compensation than their Chinese counterparts. However, I imagine that there will be less pressure to take pay cuts or accept lay offs. How much and how quickly the pressure is reduced remains unclear.

American businesses should take notice. It may soon become more expensive to shift work to China. The world’s largest labor force is finally finding its voice.

Perhaps the Chinese government fears the growing gap between the higher and lower paid workers? Perhaps it fears the growing dissatisfaction of workers moving from the countryside to manufacturing cities in search of a better life? Whatever the reason, the state has recognized the need to relieve the pressure of recent economic growth. And that Chinese workers have achieved success expressing their collective power independently in such a tightly controlled society is truly revolutionary.

Gary Chaison ( chaison@clarku.edu) is a professor of industrial relations at Clark University’s Graduate School of Management and the author of “Unions in America” (Sage, 2006).

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