Increasing Wages Isn’t the Answer

Watching the Foxconn pays its low-level workers in Shenzhen the legal minimum wage at 900 yuan/month. Ma Liquan, a former employee informed China Central Television (CCTV, 11 May 2010): “After deducting mandatory social securities, we earn only some 800 yuan a month. No one seems to force us….and yet we’ve no choice but to do overtime work.”

Set against the Harvard Business Review Case study Foxconn Technology Case (A), where the authors speak about a survey that was conducted to understand the lifestyle of Foxconn employees on the line:

Twenty Universities from Mainland China, Hong Kong, and Taiwan conducted a survey of 1,736 workers from 12 Foxconn factories in nine cites in late 2010 [… where they found … ] the average monthly living costs of a typical Foxconn worker was about 160USD, an extremely low level of standard of living.  While the workers could sustain their own lives, they had little hope of accumulating enough money to obtain a mortgage or handle any potential health problems.

and while the company previously was forced to Raise Base Salary of New Employees in 2010, and did so again in 2011, and once again last month… at the current promissory level of 286USD per month, line workers are still going to stuggle making ends meet because inflation in China for the last 2 years has been rampant.

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