Thursday, August 05, 2010

In Transition

There are labor troubles in China.

The wave of strikes rippling through China's southern manufacturing heartland have forced the country's officially sanctioned unions to try something novel: speak up for workers or risk being permanently sidelined.

Migrant workers, wary of company unions seen as ineffective or allied with management, chose to shut them out altogether when they made demands for higher wages and better benefits. It was a wake-up call for the umbrella group, the All-China Federation of Trade Unions, and their patrons -- the communist leaders who thought they could rely on it to help keep a tight leash on labor unrest.
So where is China headed?
"It's a very pivotal time. China must change the mode of economic development or it will meet difficulties. You can't sacrifice workers to drive the economy any more."

Reformers within the union body are pushing for change, and they're finding support in the upper ranks of the ruling Communist Party who hope a more vigorous national union will placate worker frustration as China attempts what could be a rocky transition from being a predominantly low-wage manufacturing economy.
Japan made the transition from a low wage economy beginning about 20 years after the end of WW2. China has taken a little longer. About 30 years from the start of the Deng Xiaoping economic liberalization era. China started from further behind than Japan and in addition had the handicap of Communism and Mao's Great Leap Backwards. So they are not doing too bad.

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