Foxconn Increases Size of Raise in Chinese Factories

[Rucker61]

As glad as I am for these people, I find it sad that with 36 hour shifts and a boat load of hours, they're only bringing home roughly half, to a quarter of the amount of money it would take to buy some of the products they are building. Whats sad is that if American workers, or Euro workers were building these, the price would skyrocket about 200%. Would you pay 4 grand for a Mac, or 700 bucks for a PS3? Me either.

QFT

Yet I see plenty of factory line workers with cell phones, just not iPhones, and I noticed a street vendor in Kowloon this week sitting at his little stand surfing on a laptop, just not a Mac, or the newest PC. Until you've been here you don't know what the people have.

200% is a low figure by my estimates.

 

[Rucker61]

It's their choice, and it's not for a lifetime, just for three years or so, on average. I worked in a factory in college during the summers from 1 am to 1 pm, six days a week, in an Alabama summer, for minimum wage, so I have some experience with those types of conditions. For what it's worth, when Foxconn announced the first wage increase on June 1 there were 5000 people lined up outside to apply for jobs.

It's commonly accepted here in China and in the offices in Taiwan that the suicides have a lot more to do with the payout and not the conditions. The poor sods who killed themselves set their families up for life. Not a bad thing, in this culture.

Update: Most companies pay an annual bonus to their employees, about two months salary, half of which gets paid before Chinese New Year and the remainder upon return to work. They've also paid bonus for overtime work (up to 3x for Sundays and holidays, 2x for weekday OT). For some reason, Foxconn has paid neither and is just now catching up with the rest of the ODMs.

Also, the 30% pay increase was for all workers. The new 66% increase is for supervisors and the like; very few of the line workers will see this increase. Only those with superior evaluations and time of service will be eligible.

 

[madmat]

Pipe dream, more likely. Sure, we can force US companies to bring back electronics manufacturing jobs through legislation (unlikely that it will pass) but you wouldn't be able to afford anything they produced. The non-US companies would still produce goods in low-labor cost regions and import them to the US, or if prohibitive import tariffs were in place, to the rest of the world. Meanwhile, all those US companies would just go out of business, or more likely, more offshore, cease doing business in the US and let the rest of their US employees go.

Sounds like a great plan.

Or, you know, the companies in question would have to deal with making a slimmer profit. Boo hoo.

Maybe if we had 100% employment (for people capable of sustaining employment) we could all afford things we wanted at the price their MFG here warrants. Cars made in Korea are not all that much cheaper than their comparable American counterparts. A Hyundai Genesis Coupe 3.8 GT is $30,500 base price whereas a Ford Mustang GT $29,645. So, yeah the lower cost of production there versus production costs here is NOT a valid argument.

 

[Rucker61]

Or, you know, the companies in question would have to deal with making a slimmer profit. Boo hoo.

If they even continued to make a margin. And companies, their stockholders and other investors look to make a certain level of return on an investment. If producing goods no longer meets the hurdle rate, investors will take their money elsewhere. Study much economics and finance?

Maybe if we had 100% employment (for people capable of sustaining employment) we could all afford things we wanted at the price their MFG here warrants. Cars made in Korea are not all that much cheaper than their comparable American counterparts. A Hyundai Genesis Coupe 3.8 GT is $30,500 base price whereas a Ford Mustang GT $29,645. So, yeah the lower cost of production there versus production costs here is NOT a valid argument.

What's the margin on a car versus electronics? There isn't a whole lot of room in a lot of electronic products to give, and most of that is at Walmart and Bestbuy. If they'd promise to only buy and sell American, then the competition wouldn't be there, but if not, then you'd have to decide between a gaming mouse for $50 or one for $100.

 

[madmat]

If they even continued to make a margin. And companies, their stockholders and other investors look to make a certain level of return on an investment. If producing goods no longer meets the hurdle rate, investors will take their money elsewhere. Study much economics and finance?

Are you fucking serious? Really? Giving them time off is going to kill the margins? Steer clear of the crack, dude. Gigabyte works their people 12hrs a shift, pays them $10 a day and gives them a day off per week (and the plant is even shut down on that day) and manages to make a profit. Foxconn just wants to make MORE profit, work conditions be damned.

What's the margin on a car versus electronics? There isn't a whole lot of room in a lot of electronic products to give, and most of that is at Walmart and Bestbuy. If they'd promise to only buy and sell American, then the competition wouldn't be there, but if not, then you'd have to decide between a gaming mouse for $50 or one for $100.

Doesn't matter what the margin is, The fact remains that the lower labor costs don't really seem to be making it to the consumers.

 

[NahBrah]

Pipe dream, more likely. Sure, we can force US companies to bring back electronics manufacturing jobs through legislation (unlikely that it will pass) but you wouldn't be able to afford anything they produced. The non-US companies would still produce goods in low-labor cost regions and import them to the US, or if prohibitive import tariffs were in place, to the rest of the world. Meanwhile, all those US companies would just go out of business, or more likely, more offshore, cease doing business in the US and let the rest of their US employees go.

Sounds like a great plan.

Yes, your logic of companies pulling out of the most lucrative market in the world makes complete sense.

 

[Rucker61]

Yes, your logic of companies pulling out of the most lucrative market in the world makes complete sense.

If American company A is forced to use American labor to product a commodity consumer device, and Foreign company B is allowed to use foreign labor to produce that commodity product much cheaper, and import that to the US for sale, just how is the American company supposed to compete in that market?

 

[Rucker61]

Are you fucking serious? Really? Giving them time off is going to kill the margins? Steer clear of the crack, dude. Gigabyte works their people 12hrs a shift, pays them $10 a day and gives them a day off per week (and the plant is even shut down on that day) and manages to make a profit. Foxconn just wants to make MORE profit, work conditions be damned.




Doesn't matter what the margin is, The fact remains that the lower labor costs don't really seem to be making it to the consumers.

Then why are so many products manufactured in low cost regions and not the US?

 

[Jimi_Shuffler]

According to a Chinese news site, electronics manufacturer Foxconn is closing its China-based factories—including the Shenzhen location which has been scrutinized over rampant employee suicides. This could mean that up to 800,000 workers would lose their jobs

Gizmodo

 

[Headcase]

Not that high, remember that their sale value of an apple product is 5x the production cost. Even if you double the cost to build the iphone you'd still be looking at higher profits per unit than normal PC vendors.

That doesn't mean they won't milk it for more money. Why should they settle for less profit, when they know that fanbois (pretty much the only apple customers outside of ipods and iphones) will pay that extra hundred or two dollars for an iMac?

 

[NahBrah]

If American company A is forced to use American labor to product a commodity consumer device, and Foreign company B is allowed to use foreign labor to produce that commodity product much cheaper, and import that to the US for sale, just how is the American company supposed to compete in that market?

Um, you responded to my post saying trade laws need rewritten. Obviously that would include tariffs to balance it out and discourage the use of slave labor of poor people in other countries.

Then why are so many products manufactured in low cost regions and not the US?

Because the company gets higher profit margins if they can screw the employees over more. Your fallacies are pretty childish in their logic, btw.

 

[Nemesis999]

Um, you responded to my post saying trade laws need rewritten. Obviously that would include tariffs to balance it out and discourage the use of slave labor of poor people in other countries.

Good luck with that. Enjoy your 7%+ inflation as the costs are passed onto consumers. BTW: When did hard work become slave labour? Americans being lazy doesn't make a 12h of standing around assembling products slave labour. I love the American viewpoint of this-is-what-we-do-and-anything-that-does-anything-else-is-evil approach.

A hundred million Chinese workers would take great joy in beating you and people like you to a bloody pulp.

 

[Rucker61]

Um, you responded to my post saying trade laws need rewritten. Obviously that would include tariffs to balance it out and discourage the use of slave labor of poor people in other countries.

Tariffs are't always the best solution.

http://economics.about.com/cs/taxpolicy/a/tariffs.htm

Because the company gets higher profit margins if they can screw the employees over more.

I understand how economics works, in theory and in practice. Let's talk about hurdle rates, which is the level of return on an investment required to make that investment worth doing by a company. If a proposed investment, like manufacturing a product, doesn't meet that ROI then a company/set of investors will invest that capital somewhere else, in different products or business opportunities.

In the case we're talking about, manufacturing products in the US doesn't meet that ROI, so companies won't do it. They'd be better off investing in different products and businesses. However, the ROI of manufacturing products in China does meet that ROI, so that's where they manufacture. If electronics companies are force to leave those low-cost manufacturing areas, and I'm still not sure on what legal mechanism you're depending on for this to work, they'll simply leave that business rather than make less money investing their capital somwhere else.

Your fallacies are pretty childish in their logic, btw.

I've got an MBA in accounting and operations management and fifteen years experience in manufacturing, both in the US and overseas. I've inspected plenty of factories in Taiwan, China, Korea and Thailand, so I'd say any problems I have here are purely in my inability to explain reality in terms you can understand. My apologies.

 

[Nemesis999]

I understand how economics works, in theory and in practice. Let's talk about hurdle rates, which is the level of return on an investment required to make that investment worth doing by a company. If a proposed investment, like manufacturing a product, doesn't meet that ROI then a company/set of investors will invest that capital somewhere else, in different products or business opportunities.

NUHUHH! If we ban trade we will all become instantly massively rich!!11!!1

 

[NahBrah]

Good luck with that. Enjoy your 7%+ inflation as the costs are passed onto consumers. BTW: When did hard work become slave labour? Americans being lazy doesn't make a 12h of standing around assembling products slave labour. I love the American viewpoint of this-is-what-we-do-and-anything-that-does-anything-else-is-evil approach.

A hundred million Chinese workers would take great joy in beating you and people like you to a bloody pulp.

Hahahaha you are ridiculous. Taking advantage of poor people because they don't have anything better doesn't justify taking advantage of poor people.

NUHUHH! If we ban trade we will all become instantly massively rich!!11!!1

Put on your dunce cap and go sit in the corner.

Tariffs are't always the best solution.

http://economics.about.com/cs/taxpolicy/a/tariffs.htm



I understand how economics works, in theory and in practice. Let's talk about hurdle rates, which is the level of return on an investment required to make that investment worth doing by a company. If a proposed investment, like manufacturing a product, doesn't meet that ROI then a company/set of investors will invest that capital somewhere else, in different products or business opportunities.

In the case we're talking about, manufacturing products in the US doesn't meet that ROI, so companies won't do it. They'd be better off investing in different products and businesses. However, the ROI of manufacturing products in China does meet that ROI, so that's where they manufacture. If electronics companies are force to leave those low-cost manufacturing areas, and I'm still not sure on what legal mechanism you're depending on for this to work, they'll simply leave that business rather than make less money investing their capital somwhere else.



I've got an MBA in accounting and operations management and fifteen years experience in manufacturing, both in the US and overseas. I've inspected plenty of factories in Taiwan, China, Korea and Thailand, so I'd say any problems I have here are purely in my inability to explain reality in terms you can understand. My apologies.

What you are saying is that American produced goods can't compete with cheap Chinese labor because cheap Chinese labor drives down the costs of goods, which is what the ROI calculations take as a given. And, you are implying that if cheap foreign labor didn't exist, that the items produced today would not exist in America. You are also saying that the entire market economy will ignore profit because it isn't large enough, which simply isn't true. You're implying people will stop selling mp3 players/phones/etc. in America because there isn't cheap labor to abuse around the world for use here. You are implying the market will not adjust to changing conditions, which is the concept that every capitalist, market worshiping Republican swears by, and will instead cease to exist in many product categories simply out of spite.

As a whole, you are implying the market will not react how it would it reality, but how it would in your fantasy. America will not become a barren wasteland of economic activity because things would be more expensive to sell here.

You argument depends on the idea that the entire world economy is entirely dependent on outsourced labor, and that without it, the economies would collapse. Kind of like the arguments for keeping American slavery around for the American south.

I know that America, much less the world, will never move towards raising the standard of living for the populations they exploit for cheap labor. Leading by good example is a thing of the past, I know. However, should America ever fall into the twilight zone and do something moral for its citizens and people around the world, the economy wouldn't collapse into Wal-marts only stocking bare living necessities.

 

[Nemesis999]

Hahahaha you are ridiculous. Taking advantage of poor people because they don't have anything better doesn't justify taking advantage of poor people.

Just because you're so god damn lazy doesn't mean that's how the world works. 10 years ago these people would have been working 14 hour days doing hard manual labour on a family farm for a fraction of the income. You're a moron. Try going to China and telling them you're working to "free them" from the "horrible conditions" that they're being forced to endure and they'll beat you to death, then bury you, just so they can piss on your grave.

 

[NahBrah]

Just because you're so god damn lazy doesn't mean that's how the world works. 10 years ago these people would have been working 14 hour days doing hard manual labour on a family farm for a fraction of the income. You're a moron. Try going to China and telling them you're working to "free them" from the "horrible conditions" that they're being forced to endure and they'll beat you to death, then bury you, just so they can piss on your grave.

Like I said, taking advantage of poor people isn't justification for taking advantage of poor people. Why can't you comprehend this?

 

[Nemesis999]

Like I said, taking advantage of poor people isn't justification for taking advantage of poor people. Why can't you comprehend this?

You're obviously far to slow to understand the simple concepts of wealth. These people have become vastly more wealthy and had their quality of life vastly increase. The fact that you're too stupid to comprehend the simple fact that money doesn't buy happiness doesn't change the fact that these people are thrilled with their new way of life.

Who says Americans are the richest people on earth? Only a moron would value wealth over happiness. The Chinese are a hell of a lot happier with their lives then the west is with theirs. The biggest worry to them is that some half-wit jackass like you will come "help" them and destroy what they have.

 

[NahBrah]

You're obviously far to slow to understand the simple concepts of wealth. These people have become vastly more wealthy and had their quality of life vastly increase. The fact that you're too stupid to comprehend the simple fact that money doesn't buy happiness doesn't change the fact that these people are thrilled with their new way of life.

Who says Americans are the richest people on earth? Only a moron would value wealth over happiness. The Chinese are a hell of a lot happier with their lives then the west is with theirs. The biggest worry to them is that some half-wit jackass like you will come "help" them and destroy what they have.

You continue to misinterpret what I am saying, and you are doing it to justify your approval of the taking advantage of poor people. You're telling me they don't deserve proper wages and standards of living because you have deemed them happy enough for you.

And, just to make fool of you because it is fun, here is a few quotes from the article your picture comes from

As such, the HPI (Happy Planet Index) is not a measure of which are the happiest countries in the world. Countries with relatively high levels of life satisfaction, as measured in surveys, are found from the very top (Colombia in 6th place) to the very bottom (the USA in 114th place) of the rank order.

Much criticism of the index has been due to commentators falsely understanding it to be a measure of happiness

That the HPI completely ignores issues like political freedom, human rights and labor rights.

* ‘Happiness’ or ‘life satisfaction’ are very subjective and personal: cultural influences and complex impact of policies on happiness
* Confusion of name: index is not a measure of happiness but rather measure of environmental efficiency of supporting well-being in a given country

lol

 

[Rucker61]

You continue to misinterpret what I am saying, and you are doing it to justify your approval of the taking advantage of poor people. You're telling me they don't deserve proper wages and standards of living because you have deemed them happy enough for you.


lol

If we were to move manufactuing jobs back to the US, as you suggest, through some legislative mechanism, do you think that the factory workers would make more than minimum wage? Where do you expect all of these workers to come from? The US factory workforce in 1980 was 19.2 million; currently it's 11.7 million. That's a delta of about 7.5 million jobs. Just how many manufacturing jobs do you think there are in China? 7.5 million is a drop in the bucket, so we'd still have 'unhappy, poor' workers producing goods for us.

http://www.chinapost.com.tw/business/americas/2010/04/29/254423/Most-US.htm

And who are you to define for someone else what "proper wages and standards of living" are? The Chinese are quite capable of defining that, and taking efforts to achieve that, on their own:

http://blog.taragana.com/business/2...for-sweatshops-than-their-parents-were-41291/

http://www.huffingtonpost.com/2010/06/08/why-the-end-of-cheap-chin_n_600330.html

They don't have to have a three bedroom house and two cars to be happy. You talk a good talk but you can't walk a good walk.

 

[Lebowski]

Good for Foxconn and the workers! Sorry to see that it took a bunch of suicides to force such a response.

They should just do it the American way and unionize.

 

[Rucker61]

They should just do it the American way and unionize.

Good idea.

http://en.wikipedia.org/wiki/All-China_Federation_of_Trade_Unions

 

[Nemesis999]

You continue to misinterpret what I am saying, and you are doing it to justify your approval of the taking advantage of poor people. You're telling me they don't deserve proper wages and standards of living because you have deemed them happy enough for you.

You're so goddamn lazy that you think 60 hour weeks (Which, BTW, is much less then many Americans do, and yes, many of them standing) is cruel or torture, and you apparently didn't even read your own quote.

* ‘Happiness’ or ‘life satisfaction’ are very subjective and personal: cultural influences and complex impact of policies on happiness
* Confusion of name: index is not a measure of happiness but rather measure of environmental efficiency of supporting well-being in a given country

Oh God. Happiness and satisfaction are subjective?!?! WHO WOULD HAVE THOUGHT. What other possible measurement could there be? And what's this? IT's actually an index of supporting well-being? Doesn't that suggest that the Chinese are much more satisfied and well off then Americans? You are vile. You want to fuck these people over to make yourself feel better. You don't care what they want. You don't care that they are happy. You just want to make yourself feel good at someone else's expense. You're exactly the kind of arrogant imposing American prick that the world hates. Let people live their lives, they don't need you to show them how.

 

[Cyrilix]

They should just do it the American way and unionize.

Hopefully not. Unions are way too powerful. I have never been in a union and hope never to be.

 

[Nemesis999]

Hopefully not. Unions are way too powerful. I have never been in a union and hope never to be.

I don't know... The only union job I've worked consisted of doing very little, getting regular raises, and knowing the management couldn't touch me. They do suck for the ones that are stupid enough to work hard at a union job though.

 

[NahBrah]

If we were to move manufactuing jobs back to the US, as you suggest, through some legislative mechanism, do you think that the factory workers would make more than minimum wage? Where do you expect all of these workers to come from? The US factory workforce in 1980 was 19.2 million; currently it's 11.7 million. That's a delta of about 7.5 million jobs. Just how many manufacturing jobs do you think there are in China? 7.5 million is a drop in the bucket, so we'd still have 'unhappy, poor' workers producing goods for us.

http://www.chinapost.com.tw/business/americas/2010/04/29/254423/Most-US.htm

This is you saying that America lost manufacturing jobs to cheap labor, and will not get those jobs back because of cheap labor. Not sure what your point is. Laughable is you asking where factory workers would come from in a time a record unemployment and pretending the pay would be minimum wage.

And who are you to define for someone else what "proper wages and standards of living" are? The Chinese are quite capable of defining that, and taking efforts to achieve that, on their own:

http://blog.taragana.com/business/2...for-sweatshops-than-their-parents-were-41291/

http://www.huffingtonpost.com/2010/06/08/why-the-end-of-cheap-chin_n_600330.html

They don't have to have a three bedroom house and two cars to be happy. You talk a good talk but you can't walk a good walk.

You are telling me I can't care about people in the rest of the world? Really? Even though those articles support my points of view? Go crunch some more numbers and orgasm over your ROI percentages, leave the humanity to the rest of us.

 

[NahBrah]

I don't know... The only union job I've worked consisted of doing very little, getting regular raises, and knowing the management couldn't touch me. They do suck for the ones that are stupid enough to work hard at a union job though.

Generic Talking Point #4

You're so goddamn lazy that you think 60 hour weeks (Which, BTW, is much less then many Americans do, and yes, many of them standing) is cruel or torture, and you apparently didn't even read your own quote.



Oh God. Happiness and satisfaction are subjective?!?! WHO WOULD HAVE THOUGHT. What other possible measurement could there be? And what's this? IT's actually an index of supporting well-being? Doesn't that suggest that the Chinese are much more satisfied and well off then Americans? You are vile. You want to fuck these people over to make yourself feel better. You don't care what they want. You don't care that they are happy. You just want to make yourself feel good at someone else's expense. You're exactly the kind of arrogant imposing American prick that the world hates. Let people live their lives, they don't need you to show them how.

You brought the argument that your lame little chart was a happiness meter, when it conclusively IS NOT. Try to focus and stay on topic to resist the urge to do stupid shit like claim the idea of subjective happiness proves you right, when your own god damn source says

"Much criticism of the index has been due to commentators falsely understanding it to be a measure of happiness".

As such, the HPI (Happy Planet Index) is not a measure of which are the happiest countries in the world.

That the HPI completely ignores issues like political freedom, human rights and labor rights.

Put on your dunce hat and go sit in the corner, like I told you earlier.

American David Levy, who runs a factory making electric cables in Dongguan, has witnessed the generational shift in China’s work force. He described the first waves of migrants, who planned to send most of their money home and eventually return to their village to build a house.

“Fifteen years ago, the expectation was: a place to work, a salary and then they didn’t care much about anything else. Life was just going to suck for a couple of years,” he said.

Photos of his factory workers from five years ago document the generational change. None show workers with the wild mop-top hairstyles that are popular now, he said.

“Their demeanor is also different,” Levy added. “They can actually look the boss in the eye when they’re talking. They don’t cower when the boss comes around. They’re becoming more and more like American workers. I like that.”

Luckily, Chinese youth don't think they are happy enough because people like you have deemed the systematic taking advantage of their parents as acceptable.

“It’s true that we’re less willing to eat bitterness,” Chen said with a chuckle, using a popular Chinese phrase for enduring hardship. “We’re better educated. We know we have rights. Times have changed.”

 

[Nemesis999]

You brought the argument that your lame little chart was a happiness meter, when it conclusively IS NOT. Try to focus and stay on topic to resist the urge to do stupid shit like claim the idea of subjective happiness proves you right, when your own god damn source says

Put on your dunce hat and go sit in the corner, like I told you earlier.

Way to ignore the content of the post.

Welcome to ignore troll. Enjoy showing the rest of the world the "Right" way to live you pretentious prick, hopefully one of them will give you what you deserve.

 

[a2vr6]

Wow, rampant scum in North America. We'll see what kind of job/quality of life you have when we've fully outsourced work to the east. Douches...

 

[Powerage]

Foxconn's continual increase of employee wages, drastic increases at that, should hint to all the assholes out there saying the suicides are nothing out of the norm for china, that something was obviously wrong with the way they were working people.

 

[NahBrah]

Foxconn's continual increase of employee wages, drastic increases at that, should hint to all the assholes out there saying the suicides are nothing out of the norm for china, that something was obviously wrong with the way they were working people.

Nope. You'll just get people like Nemesis999 who argue the opposite of reality and ignore blatant proof of their delusion.