Foxconn, the largest maker of electronics in the world, this morning announced a pay raise of 16 to 25 percent for its Chinese factory workers, the third wage increase since 2010. The announcement comes after human rights protesters last week targeted Apple — which counts Foxconn as a major manufacturer of its popular iPhone and iPad devices — over the unethical factory conditions of its suppliers.
Pressure has been mounting for US electronics companies to revisit the relationships they hold with Asian manufacturers such as Foxconn, a Taiwanese technology firm that is estimated to employ over 1,000,000 Chinese workers. Reports, such as a recent expose published by The New York Times, describe severe worker abuse on Foxconn factory floors, including shifts as long as 34 hours, and repeated exposure to dangerous chemicals such as hexane, a neuro-toxin which when inhaled, can cause nausea, headaches, and eventual peripheral nervous system failure. Hexane is used to clean iPhone and iPad screens.
According to a statement issued on Friday, “the pay of a junior level worker in Shenzen, southern China, had risen to 1,800 yuan ($290) per month and could be further raised above 2,200 yuan if the worker passed a technical examination,” reports Reuters. It said that pay three years ago was 900 yuan a month.
Yesterday, a mostly uncovered meeting took place between Apple CEO Tim Cook, and Foxconn chairmen Terry Gou, reported Bloomberg. Although the official aim was to discuss Apple’s expansion in China, today’s news of a Foxconn wage increase indicates that Cook may have employed his famous negotiating skills to convince his counterpart to acknowledge the public outcry, and take substantive action regarding working conditions in Foxconn’s Chinese factories.
“As a top manufacturing company in China,” read today’s statement, “the basic salary of junior workers in all of Foxconn’s China factories is already far higher than the minimum wage set by all local governments. We will provide more training opportunities and learning time, and will continuously enhance technology, efficiency and salary, so as to set a good example for the Chinese manufacturing industry.”
Cook looks toward change
Tim Cook, Apple’s newly appointed CEO, has seemed much more eager than his predecessor, the late Steve Jobs, to address consumer concerns regarding the ethical treatment of Apple’s supply chain employees head-on, stating “We believe every worker has the right to a fair and safe work environment free of discrimination, where they earn competitive wages and can voice their concerns freely. Apple’s suppliers must live up to this to do business with Apple,” according to a recent article in Fast Company.
Earlier this week, Cook took the unprecedented step of inviting an outside monitoring group to Foxconn’s Chinese factory floors to investigate the claims of workplace abuse. The Fair Labor Association, the non-profit tasked with carrying out the inspections, told Reuters on Wednesday that initial inspections found the Foxconn factories “first class.” Auret van Heerden, President of the FLA, went on to state, “I was very surprised when I walked onto the floor at Foxconn, how tranquil it is compared with a garment factory.”
Founded in 1999, the FLA is partially funded by major US corporations, such as Nike and Liz Claiborne. Because of its manufacturing industry ties and funding, critics charge that it has done little to precipitate real change in the treatment of workers in manufacturing jobs around the world.
“The Fair Labor Association is largely a fig leaf,” Jeff Ballinger, the director of Press for Change, told The New York Times this week. “There’s all this rhetoric from corporate social responsibility people and the big companies that they want to improve labor standards, but all the pressure seems to be going the other direction — they’re trying to force prices down.”
While social activism groups may see today’s news largely as a victory for workers rights in China, the reality remains that true change in working conditions can’t be met without consumers being hit where they have largely resisted: in their wallets.