Immigration News: January, 2005 - Volume 12

China: Migrants, Economy

China has an estimated 114 million rural-urban migrants (liudong renkou or "floating population"), most of whom earn $50 to $70 a month in factories in coastal provinces and work more than the maximum 49-hour work week. Many rural-urban migrants have trouble collecting the wages due them; most employers keep two months wages, and refuse to pay migrants if they do not stay as long as the employer wishes. The official newsweekly Beijing Review reported in December 2003 that 72 percent of migrant workers are owed a total of $12 billion in back wages.

Almost 20 million children of internal migrants live with their migrant parents, and half are not in school. Nine years of schooling is compulsory in China, but migrants are often required to make "donations" equivalent to a year's wages, often $1,200 or more, if they want to enroll their children in public schools away from the place in which they are registered to live. Some migrant families have cooperated to open migrant schools that charge much less, usually under $100 a year, but their quality varies.

Beijing recently ordered its schools not to charge migrants more than local pupils, $64 a year in fees for primary school and $84 a year for grades seven through nine. However, even if they graduate from Beijing schools, migrant children must return to the places in which they are registered to take college entrance exams. China spends only two percent of its GDP on education, and schools levy a variety of fees on parents to raise money.

Some 700,000 Chinese students have studied abroad in the past 20 years, and an increasing number are returning to China to take advantage of economic opportunities. A Fall 2004 survey of those abroad found that over 85 percent expected to return to China in part because, as one said, while abroad they read in the press of the "China boom."

Economy. The New York Times reported on many of the changes wrought by China's evolving two-speed economy, in which rapid growth in coastal provinces attracts male migrants from inland rural areas to work in construction, and female migrants to work in factories. The result is family separation, labor unrest as migrants realize they are being exploited, and corruption among local officials in rural areas that encourages more migration.

The rural-urban contrast in the lives of children is stark. Urban couples connected to the global economy often call their only child xiao taiyang, or "little sun," as in center of the universe, while rural couples call their child or children liu shou, or "left behind" with grandparents as the parents migrate to coastal provinces. Some studies show that medical costs are the leading reason that rural residents fall into poverty because they have no insurance, and then find that migration is the fastest way to repay emergency loans. School fees are $50 a year in rural areas where family incomes are sometimes $300 a year; none of today's students want to be farmers like their parents.

In rural areas, the pattern is increasingly migrant work for the young and farming for the old. Peasants cannot own land, and local officials levy taxes and sometimes take the land for projects that wind up leaving peasants without land or jobs.

China's economy has been expanding by eight to nine percent a year, but labor productivity growth has also been very high, over seven percent a year in the past five years. This means that job growth is only one to two percent a year, which is not enough to absorb new job seekers and those being displaced from agriculture and restructuring state enterprises. The tension between the goals of raising GDP growth, creating additional jobs and increasing labor productivity has been resolved in favor of labor productivity, but this may change if unemployment and unrest rise.

Labor unrest is rising, and sometimes involves migrant workers in coastal-area factories, where living costs are rising faster than workers' wages. The government-run All-China Federation of Trade Unions, is the only legal union in the country, and Wal-Mart has agreed to allow its unions in its factories in China. Workers say, though, that most union leaders are local government officials allied with management. The workers, most of whom are young women, typically work 60 hours a week for $120 a month, and most live at their factories in company-provided dormitories and eat in company cafeterias, for which they are often charged a third of their wages.

In at least one case, worker unrest was encouraged by local employment brokers who once earned commissions for job placements but had been replaced by a company employment office. In other cases, senior Communist Party officials have abused ordinary people, leading to protest demonstrations and assertions that China is having more trouble maintaining social order than at any time since the Tiananmen Square democracy movement in 1989. China's top leaders say they want to improve governance, which they define as making party officials less corrupt and more responsive to public concerns.

Workers at Uniden, a Japanese telephone maker that supplies Wal-Mart, protested their wages of 484 yuan ($58) a month in December 2004. Uniden charges the women almost half of their wages for room and board, and some reported paying half a month's wages to get hired.

A third of the world's shoes are made in Guangdong, the province that borders Hong Kong, and the Yue Yuen shoe-making industrial complex near Dongguan employs 70,000 migrant women to make shoes for Nike, Adidas, Reebok and other brands. Production lines with 470 workers turn out 2,000 pairs a day.

About 85 percent of the assembly-line workers are in their first jobs, earning $72 a month after deductions for room and board. Under pressure from Nike and other manufacturers, the maximum work day is 11 hours or 60 hours a week. In the factories and dorms, workers from the same province tend to stick together, often speaking dialects others cannot understand.

The turnover rate is 60 percent a year, with workers missing villages while away but boring quickly when they return for visits, prompting some to cycle between village and factory.

Young migrant workers exposed to the wealth of China's relatively rich eastern cities are growing increasingly angry over what many see as their exploitation, which could launch an independent union movement in the coastal provinces.

Farmers continue to complain that the land they farm but do not own can be taken away by local officials who want it for other purposes, and they have little choice but to accept what they are offered. Under Chinese law, the government owns the land, and those using it are in a weak legal position when told they must give up their land for factories or other projects. Land seizures and inadequate compensation became so common in 2004 that central government officials ordered a temporary freeze on the economic development zones chewing up farmland.

In the village of Xisha in northern Shaanxi Province, farmers were offered $60 per mu (about a sixth of an acre) for their land. Local officials turned around and leased their land for 50 times more, and pocketed much of the difference. In this case, villagers secured assistance and traveled to Beijing to protest at government petition offices, the main official channel for popular dissent in China's authoritarian political system. However, Beijing officials usually turn the petitions over to the same local officials who caused the problems that led to the petitions. In this case, protest leaders were eventually arrested, and local officials took the land for development.

Like Japan from the 1950's through the 1980's, China has shown that a country can sustain high growth rates for many years by combining hard work with a closed financial system that channels very high household savings into countless industrial projects and other ventures selected partly by government bureaucrats. Japan's stagnation since the early 1990's suggests that such policies may have limitations, but no one knows when China will hit its wall. Optimists point to a flourishing of entrepreneurial energy that has long been part of the culture of overseas Chinese communities and has now emerged with full force in mainland China.

When China began to move away from its centrally planned economy in 1978, urban incomes were about 2.5 times rural incomes. The urban-rural income gap narrowed in the early 1980s, but then began to widen, so that by 2004 urban incomes averaging 8,000 yuan were almost four times more than rural incomes of 2,000 to 2,500 yuan.

China has become a factory to the world, producing half of the world's cameras and a quarter of its air conditioners and washing machines.

Taiwan. Since 1992, mainland Chinese women have been able to move to Taiwan if they marry Taiwanese men; some 200,000 have done so, including 40,000 in 2003. Emigration pressures remain strong in China despite rapid economic growth, and Taiwan's per capita income is 11 times the $1,000 average on the mainland. Most of the marriages result from personal introductions made by family and friends, although a significant share also result from Taiwanese men traveling to the mainland and from marriage bureaus.

By some estimates, half of the mainland women disappear into the underground economy soon after their arrival. Mainland brides cannot usually work legally, and can become naturalized Taiwanese only after eight years of residency.

Leslie T. Chang, "In Chinese Factory, Rhythms of Trade Replace Rural Life," Wall Street Journal, December 31, 2004. Jim Yardley, "Farmers Being Moved Aside by China's Real Estate Boom," New York Times, December 8, 2004.