A new report from a Chinese newspaper is claiming that Hon Hai’s Foxconn factories will be closing. If the report is true, it will mean that the promises to increase the workers’ wages by 70-percent might amount to nothing, and it will be a sad ending to a story steeped in tragedy.
Foxconn continues to stay in the news, first because of several suicides that drew the media’s attention to conditions that labor groups have called “sweatshop-like.” With twelve suicides in six-months, Hon Hai grudgingly responded by promising increased wages. At first it promised a 20-percent raise, then it changed that to a 30-percent increase in July, which would proceed a 70-percent increase in October, that would see most of the lowest paid workers receive double their current salaries.
If the report is true, Foxconn will move production to Taiwan, where it will increase its robotic assembly lines, and Vietnam, where the labor is much cheaper, and where Hon Hai will be unlikely to honor its wage increases that were directed to the Chinese workers.
Foxconn currently employs more than 400,000 employees in China.