Wed., June 26, 2013 1:45pm (EDT)

Angry Chinese Workers Resort To Direct Action
By Krishnadev Calamur
Updated: 10 months ago

American Chip Starnes, co-owner of Specialty Medical Supplies, waves Monday from a window where he is being held by angry workers inside his plant at the Jinyurui Science and Technology Park on the outskirts of Beijing. He remained confined to the plant on Wednesday.
American Chip Starnes, co-owner of Specialty Medical Supplies, waves Monday from a window where he is being held by angry workers inside his plant at the Jinyurui Science and Technology Park on the outskirts of Beijing. He remained confined to the plant on Wednesday.
When Chinese workers have a grievance, they are increasingly taking dramatic and direct action.

As we've reported, an American executive at a Chinese factory has been prevented by workers from leaving the plant since Friday. Chip Starnes of Specialty Medical Supplies says it's a misunderstanding following a decision to shut down part of his medical-supply business and move some jobs to India where wages are lower.

He says workers erroneously believe he plans to lay them all off. As of Wednesday, he still wasn't allowed to leave the plant on the outskirts of Beijing.

This story is part of a larger pattern of labor strife in China.

As The Wall Street Journal noted: "While bosses aren't held captive in their companies every day in China, Starnes is not the first one. In January this year, around 1,000 workers at Shanghai Shinmei Electric Company held Japanese and Chinese managers hostage in the factory, claiming that work rules for bathroom breaks and punishments for tardiness were too harsh."

Li Qiang, executive director of New York-based China Labor Watch, says though the problem is common, it's rare for a Westerner to be involved.

"Generally, a lot of worker protests are similar to this because of unpaid wages," he told NPR through a translator. "Bosses move factories without a heads up to workers, and so workers are left unpaid."

Indeed, as the Journal says: "Numbers for such disputes are hard to come by, though an investigation by the Economic Information Daily, a newspaper published by the official Xinhua news agency, found that more than 400 bosses ran away from bankrupt factories in Eastern China's Zhejiang province in 2008.

Most of those executives worked for foreign companies, meaning workers had virtually no hope of claiming months or even years of back pay owed to them."

NPR's Anthony Kuhn explained the root of the story on Tuesday's Morning Edition:

"The big picture is that Chinese wages are starting to rise pretty quickly, particularly in the coastal manufacturing enclaves. And so foreign manufacturers have to look farther inland where wages are lower or they have to look to other countries, including Southeast Asia. Every country welcomes investment coming in. When it [investment] starts to look elsewhere, when it starts to move out, sometimes companies experience difficulties. ... We may be seeing this more and more in the future, and the question is: Does China have the infrastructure and the institutional resources to deal with this? And in this case, the answer is no."

As Li said of Starnes' case, if workers "had relied on the legal process, then it would have been long and inefficient. Workers would lose more than they gain. So they felt this was the only way forward for them."

Part of the reason for the movement of some jobs from coastal China, as Anthony noted, are wages. Some of those jobs are returning to the U.S., says Harry Moser of the Reshoring Initiative, an effort to bring manufacturing jobs back to the United States.

Moser's group estimates that 80,000 manufacturing jobs have come back since 2010, but that figure doesn't include jobs that were outsourced in the same period. But some estimates note that if Chinese wage trends continue at their current pace, 1 million manufacturing jobs could return by 2015.

"If companies did the math, 25 percent of what the companies had offshored would come back," Moser says.


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