SHANGHAI — Mass protests at a major Chinese shoe factory reflect the stark changes taking place in the country’s labor market, particularly in the manufacturing sector.
This story first appeared in the April 16, 2014 issue of WWD. Subscribe Today.
Yue Yuen Holdings Inc., a Taiwanese-owned shoe manufacturer for global brands, including Nike Inc. and Adidas AG, is at the center of a massive labor protest after at least 1,000 workers took to the streets demanding better employment benefits at its factory in southern China on Tuesday, according to the state-run China Business News, or CBN.
The protests flared over the weekend in Dongguan, a manufacturing hub in the south. The shoemaker said it is working to resolve the dispute, CBN reported. Phone calls to Yue Yuen outside normal office hours were not answered.
The New York-based China Labor Watch said in a statement released on Monday that it estimated “tens of thousands” of workers at Yue Yuen had gone on strike to “protest unpaid social insurance and housing fund payments and improper labor contracts.”
“This strike is likely one of the largest Chinese worker strikes in recent history,” China Labor Watch said, adding that the protests that began in early April have intensified because the factory has not completely answered the workers’ demands.
The Hong Kong-listed Yue Yuen, which has more than 40,000 employees in Dongguan, also makes shoes for Reebok, Asics and New Balance. The company did $7.58 billion in turnover in 2013.
The protests are the latest sign of the growing pressures on Chinese manufacturers. At recent textile fairs in Shanghai and Beijing, manufacturers have said worker shortages are, at times, severe due to the fact that fewer young people want to work in factories, and more are obtaining higher education or are opting to find jobs closer to home in western China, where many migrant workers in the country’s eastern manufacturing epicenters have historically come from.
As a result, workers are demanding higher wages and more benefits due to the supply-and-demand scenario turning in their favor. And it appears they are more willing to stand up to employers who do not meet their demands. Over the past decade, labor disputes have come to represent more than a third of mass protests in China, the state-owned China Daily newspaper reported in April, citing a government report.
In recent months, other multinationals have had business impacted in China due to labor disputes. Last month, more than 140 employees protested outside of a Wal-Mart store in central China over what they said was an unfair severance package after it was announced the store would close, the Hong Kong-based China Labor Bulletin reported. Also in March, a manufacturer for Samsung raised overtime wages after more than 1,000 employees went on strike at its factory in Dongguan, China Labor Bulletin said.