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Response to Foxconn Workers Threaten Mass Suicide Post

By Ellen Rosskam, Ph.D., MPH, Center for Social Epidemiology’s European Associate

Click here to read the blog entry.

Foxconn workers threaten mass suicide in response to terrible working conditions

by Erin Wigger and Peter Schnall
 
Foxconn (which manufactures iPhones and iPads for Apple) has experienced a number of suicides in the last two years – 14 to date, as well as a number of  unsuccessful attempts. The company responded by raising wages 66% at it’s Shenzen plant, boosting its number of counselors, and making stress management programs available to workers there. It also built safety netting around the factory to prevent further suicide attempts and required that all employees sign a “no suicide” clause in their contract (effectively preventing further payouts to families in the event of a death by suicide). Foxconn also responded with claims that it’s number of suicides, per capita, are not much higher than China’s national average – implying the suicides are not the result of conditions at the manufacturing plant.
 
However, on January 2nd approximately 150 workers took to the roof of Foxconn’s factory in Wuhan threatening mass suicide if their demands for better pay were not met. The New York Times reports that workers involved in the protest made accused Foxconn of reneging on the salary initially offered workers agreeing to leave the Wuhan factory – paying only a third of the previously proposed salary – and cited unfair treatment at the plant as the reason for their protest. (Recall the many stories that have appeared in the press of the oppressive working conditions at Foxconn with workers reporting excessive work weeks of 72 hours or more, militaristic supervision, low wages, and company induced indebtedness that have prevented many workers from leaving it’s factories.) 
 
A protest of this nature is shocking. It is hard to condone this type of negotiation or to imagine it is anything but counter-productive in terms of entering into a legitimate dialogue between employers and employees. So what drove it into being? Is this an act of absolute desperation on the part of a collectively abused and exploited labor force, or the extremist tactics of workers trying to coerce the company into bending to their demands?
 
If this were the first step worker’s had made toward resolving their conflict that would be one thing. But this protest came about only after Foxconn rejected workers attempts at bargaining and issued an ultimatum: resign and receive compensation or stay and continue on the same pay scale as before. In response  to these conditions, approximately 45 employees resigned, but none received any compensation.
 
This underlines the fact that Chinese employees have no safety net. They do not have the avenues of recourse we, as Americans, enjoy – though these rights in the U.S. are being whittled away daily (e.g. recall the recent Wisconsin Union Bill intended to strip public workers of their collective bargaining rights). In China, Geoffrey Crathall, Director at the China Labor Bulletin, was quoted to have said “employees feel they have no other option. If there were proper channels for the resolution of grievances, they wouldn’t have needed to resort to such actions” and, after weighing the facts, it is hard to disagree. Poor working conditions and pure desperation seem to have driven these workers to the roof.
 
The protest ended eight hours later after workers were talked down by Foxconn managers and local Chinese Communist Party officials. It remains dubious as to whether or not the dispute over wages has been adequately settled or not.

http://www.upi.com/Business_News/2012/01/11/Mass-suicide-threatened-at-Chinese-Foxconn-factory/UPI-57621326312862/?spt=hs&or=bn 

What a Surprise: Apple Profit Margins Rise at the Expense of Foxconn and Pegatron Corporation

Bloomberg reports in an article today that Apple’s margins have widened at the expense of its main supplier as Foxconn Technology Group cuts prices to retain orders for the iPhone and iPad.

The profit spread at Hon Hai Precision Industry, Foxconn’s Taipei-listed flagship, has narrowed to 1.5 percent since the debut of the iPhone in June 2007 as Apple’s operating margin more than doubled over the past five years, surpassing 30 percent.
 
Apparently, Foxconn as well as Pegatron are willing to sacrifice profit margins in exchange for volume and scale.  Both companies have seen profit margins decline despite increase sales due to rising salaries and lower sale prices to Apple Corp. on Ipads and Iphones.
 
This process puts both companies under increasing pressure to get more from workers for less. So if salaries go up it becomes critical to increase worker productivity.
 
Maybe this has something to do with repetitive motion disorders, stress disorders, suicides and explosions at plants not ready for production but which are pressed into service nonethless (see my previous blog).

See http://www.bloomberg.com/news/2012-01-04/apple-profit-margins-rise-at-foxconn-s-expense.html for more information.

Another explosion reported in a Chinese Manufacturer that supplies Apple

For the third time in little over a year an explosion has rocked a factory that supplies parts in the manufacturing of various Apple devices. The explosion injured 61, and sent 23 to the hospital. Fortunately, there were no fatalities. 

This particular plant (which supplies back panels needed in the manufacturing of IPads), according to Pegatron Chief Financial Officer Charles Lin, “…had not started operations yet. Part of the facility is still under pre-operation inspection and part is running trial production.” 1 
 
Chinese suppliers are under tremendous pressure from Apple to increase supply to keep up with worldwide demand for IPhones and IPads. Manufacturing the aluminum shells is, admittedly, not without risk. The shells need to be polished and the powder used in this process is potentially explosive – requiring a factory environment with adequate ventilation. Still, providing such an environment is not rocket science.
 
It is not hard to see that under pressure to increase production companies are cutting corners. In this case, a plant which has not yet “started operations” has already experienced an explosion injuring 61 people.
 
Who is responsible for this (preventable) disaster? Is it the company which rushed, recklessly, into trial production a facility not yet ready for prime-time, the Chinese government with its lax supervision of various regulations (or perhaps no regulations at all), or is it Apple computer corporation which turns a blind eye to the practices of its suppliers so that they may sell a million or so more iPhones and IPads. Apple Corporation made $7.31 billion dollars in profits in their 3rd Qtr. 2011 financial year alone.
 
Perhaps there are others who deserve mention.  Please share your take on this tragedy.
 
Peter Schnall
 

“Apple supplier Pegatron hit by China plant blast” By Clare Jim and Argin Chang, Reuters. 

Disney: American Dream or Nightmare?

By: Peter Schnall & Erin Wigger
 
The name Disney is highly evocative for many Americans. Some think of their favorite childhood movies – Bambi, Pinocchio, Snow White, Lion King, etc., others call to mind one of Disney’s 14 worldwide theme parks and resorts. Disney  has, over the last 70 years become a part of what many conceive as the American Dream.
 
Today,  when someone wins a Publisher’s Clearing House award, or the Superbowl, what do they think to scream? Many things I’m sure but, “I’m going to Disneyland” has become a catch-phrase for people who, for whatever reason, have come into enough money or fame to finally elevate themselves into the class of people who can afford to have the magical experience of a Disneyland adventure.
 
But there’s a darker side to Disney Corporation, which has a long history of labor disputes. As reported by Steve Lopez of the LA Times on October 19th, something new and unwanted has made an appearance in the perfect world called Disneyland. Disney Corp. has begun a new chapter in electronic monitoring of some of its workforce in the form of large TV screen displays in the work area. Workers at Disney’s Paradise Pier Hotel in Anaheim have labeled the large flat-screen monitors in the laundry room the “electronic whip.” This screen, displayed for all to see, visually tracks worker progress by giving “efficiency” percentages in green – for those who are at or above expected productivity – and red for those below it. Not only does this cause anxiety for workers in general, it pits them against one another in a minute-by-minute race to be on  top. Workers complain of putting off or missing toilet breaks in order to keep up.
 
If you look to the left  on our blogsite you’ll see snippets from Charlie Chaplin’s movie Modern Times. After reading Lopez’s article on the electronic monitoring of Disney Hotel Workers, Charlie’s satire of the industrial production line appears, once again, prophetic.
 
This Disney tale is one example of “lean going mean.” Though the Foxconn plants (see earlier blogs re Foxconn) are many thousands of miles away, this speeding up of the workplace has become widespread. Known to be detrimental to worker health, the ever-increasing push to produce more and faster keeps workers locked in a social and biological struggle to meet inhuman demands under inhumane working conditions. But speed ups and social isolation created by competition between workers is just the tip of the iceberg. Workers at Disney not only complain about the pace, they also complain of low wages, job insecurity, lack of respect and the injustice of having to put on a “happy face” and give, even the most slovenly of guests, a “magical experience” when they themselves are looking at dwindling wages and increased health care costs (see psychosocial stressors blog #2).

Why America’s unquestioning idolization of Steve Jobs is inappropriate

Steve Jobs, the co-founder of Apple Computer Corporation died today October 6 2011 at the age of 56 from a rare form of cancer of the pancreas. His death has been accompanied by widespread expressions of admiration for the man and his accomplishments. These accomplishments include the creation of Apple Computer Corporation, apple computers, the iPod, iphone and ipad as well also NEXT computer corporations and Pixar animations including Toy Story.   He overcame numerous adversities in his climb to success and fame including being fired from Apple Computer Corporation by a man he hired to manage the company for him while he focused his energies on developing new products.  It is probably fair to say of Steve Jobs that he exemplifies much of what many Americans think is the best about America; opportunity to rise from nowhere to stardom, no silver spoon in his case but lots of hard work and a eye on the goal.  I admired him.  He seems like a good man, there are no terrible stories about him, his company is respected and he is idolized by many.   The cofounder of Apple, Wozniak says, perhaps a bit tongue in cheek, that he’ll “be remembered for the next hundred years as the best business leader of out time.” 

You may be wondering, “where’s the beef”?  Those of you who have read my recent blogs will know that Steve Jobs is a pivot figure in one of the most important aspects of globalization – the offshoring and outsourcing of production to the developing nations of the world. Just as Apple has grown in recent years so have the companies that supply apple with the parts and machines that make Apple a successful corporation. One company that supplies Apple is Foxconn a Chinese firm which now employs more than 1 million workers and is one of the fastest growing companies in the world. They manufacture Ipads and Iphones for Apple. If you have read my earlier blogs you realize that one focus has been on the terrible working conditions at Foxconn Corporation in China. Long work weeks – 12  hours a day x 6 days a week, military like working conditions, low wages, and low employee morale has led to more than 15 suicides in the past year.  One might argue that Foxconn is not Apple. After all, Apple has a “code of practice and conduct” that they claim they hold each company to. Yet, there is little doubt that the pressures to produce products at Foxconn at competitive prices has contributed to these working conditions.  

And now we return to Steve Jobs – the pioneer and great business man – and ask what role does he play in this process that leads to these desperate conditions for Foxconn employees and what responsibility does he have for the conditions that face working people at Foxconn and for that matter in China as a whole? This question is one that has troubled scholars. How much are individual’s (regardless of their position in society) responsible for the exploitation that occurs at the hands of a capitalist economy and how much are they mere “cogs in the wheel” whereby their hands are forced by the pragmatics of business, growth and accountability to shareholders. Some would say that a man with the power of Steve Jobs could have turned his attention and made a difference to the working conditions at Apple’s subcontracted companies.  Why he didn’t consider encouraging Apple to pull its contracts with Foxconn is a story we may now never know. 

Robots to Play Crucial Role in Foxconn Future Expansion

With pressure to produce still more coming from Apple and other end users and the company complaining of low profit margins, Foxconn has now sought to increase its production processes by means of robotics. According to Terry Gou, the company’s founder and chairman, Foxconn already makes use of some 10,000 robots and sees many benefits in expanding its use of robots. Gou plans to use the new robots to perform tasks such as spraying, welding and assembling. He projects that utilizing up to 1 million robots will improve the working conditions at his plant for Foxconn workers by eliminating those parts of the production process which are repetitive and menial, effectively elevating it’s workforce into positions with increased skill-level and value.

But will the modernization of Foxconn’s plants into a futuristic, automated factory actually mean better working conditions for China’s workers, or just a loss of jobs? Gou’s argument seems to favor the hypothesis of Skill Biased Technological Change (SBTC), which purports to positively favor a shift from an un-skilled labor force to skilled workers. SBTC has, however, become the center of debate on the unequal distribution of power in the workplace (management vs. workers) and the increasing inequality of wealth between social classes in Capitalist societies.

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