Facing economic headwinds with almost all sectors, including property and manufacturing showing no signs of turnaround even in near future, China is now grappling with unrest among blue-collar workers as social safety nets and compensations that helped them overcome their day, today challenges, have started dissipating amidst harsh and discriminatory labour landscape in the East Asian country.
Subdued by a continued downturn in the property sector, which saw investment falling 10.1% in the first half of 2024 from a year earlier and low household demand, China’s economic growth slowed to 4.7% in the second quarter, from 5.3% in the first quarter of this year.
On the other hand, China’s Caixin/S&P Global manufacturing PMI (Purchasing Managers’ Index) sank to 49.8 in July from 51.8 in June, 2024—the lowest since October 2023, Reuters said. With external and domestic demands for Chinese goods remaining low and stifled, manufacturing activities are in dire straits in the East Asian country.
Several factories have shut down their operations, while some are operating at much below their manufacturing capacity, leaving it highly challenging for blue- collar workers to eke out living in the country. Blue-collar workers account for around 70% of the total employees in China’s manufacturing and service sectors, most of whom earn between 5,000 ($718) and 8,000 yuan per month, South China Morning Post, quoting the government-backed data, said.
In the situation when blue-collar workers, majority of whom come from rural areas, are laid off, they are hit particularly hard by the fact that their jobs besides, being low paid ones, do not entail any legally binding contracts with their employees.
As such, they are forced to accept whatever their employees’ hand over them in terms of compensation at the time of their termination from their jobs. This compensation does not include any social security benefits that could help them alleviate their post job retrenchment life. They are left to fend for themselves.
Experts say it is very difficult for workers to find jobs that pay for social security for 15 years, the prerequisite for getting pension when retired. This has bred financial insecurity across the labour market with workers often resorting to strikes to vent their anger against the system.
According to the China Labour Bulletin (CLB), a Hong Kong-based workers advocacy group, labour strikes in the East Asian country increased 3% on the year to 719 incidents in the first half of 2024. The largest number of protests— as much as 344 incidents—were carried out by construction workers demanding wages, the CLB said.
In fact, migrant workers engaged in construction areas are the worst sufferers. There are reports which suggest that workers in Xinjiang and some other Chinese provinces have to wait for months for their pay checks. However, after the construction industry, it is a manufacturing sector where workers are victims of uncertainties and employers’ callousness.
Between January and June 2024, as many as 240 incidents of strikes were carried out by workers from the manufacturing sector. Workers engaged even in internationally recognised brands like Nike, Adidas, Solomon, and Timberland have undertaken strikes for their unpaid wages and compensation.
Such protests speak volumes of workers’ unhappiness in China where their usual complaints are linked with long working hours and low or unpaid wages, the CLB said. These strikes are also linked with non-provision of social safety benefits. For this, analysts blame poor implementation of labour protection rules and prevention of workers from forming independent and effective labour unions that could help them take their cause to the government and seek its support in the redressal of their problems.
What hurts China watchers is that despite workers forming the economic backbone of the country, they face discrimination and apathy at the hands of their masters. While urban workers with registered homes get more in terms of wages and access to services—ranging from medical help to education, migrant workers whose population constitute around 293 million do not get any such benefits. Chinese authorities are aware of the prevailing discriminatory situation, yet no serious attempt has been made to correct the disparity between urban and migrant workers. However, at the third plenum held last month, Chinese leaders vowed to improve the social security system by addressing the problem faced by migrant workers, but it is in the realm of speculation whether steps will be really taken to turn promises into reality, given that working conditions are often at the will of capricious management of companies in the country.