Giant Factories in China and Vietnam
IN MID-2010, A RASH OF WORKER SUICIDES BROUGHT global attention to a company that three years earlier the Wall Street Journal had dubbed “the biggest exporter you’ve never heard of,” Hon Hai Precision Industry Co., operating under the name Foxconn. That year, eighteen workers between the ages of seventeen and twenty-five attempted suicide at Foxconn factories in China, fourteen successfully, all but one by jumping off a company building. Though startling by themselves, what made the suicides a big story around the world was that they occurred at factories that assembled iPads and iPhones, among the hottest consumer goods on the market, symbols of modernity and good living. The juxtaposition of workers feeling so oppressed and alienated by their jobs that they took their lives with the elegantly designed Apple products—seamless, luxurious, futuristic—for a moment raised uncomfortable questions about the sausage factory in which the meat of modernity was being produced, and the human cost of stylish and convenient gadgets.1
The corporate reaction to the suicides proved almost as disturbing as the deaths. The companies that used Foxconn to produce their products, including Apple, Dell, and Hewlett-Packard, took a low-key approach, expressing concern and saying that they were investigating. Apple CEO Steve Jobs called the suicides “very troubling,” adding, “We’re all over this.” In 2012, after more bad publicity about Foxconn, Apple contracted with the nonprofit Fair Labor Association to inspect Foxconn plants and their compliance with the monitoring group’s workplace code of conduct. But none of Foxconn’s major clients, including Apple, stopped using its services.
Foxconn founder and chairman Terry Gou at first dismissed the suicides as insignificant, given the size of his workforce. But as the deaths and bad publicity mounted and Foxconn’s share price fell, the company began to act. In June 2010, Foxconn raised basic wages at its Shenzhen plants, where most of the suicides occurred, from the legally mandated minimum of 900 renminbi a month ($132) to 1,200 renminbi ($176) and in October raised wages again. It also set up a twenty-four-hour counseling center for its workers and put on an elaborate celebration at its largest plant, complete with a parade, floats, cheerleaders, Spider-Men, acrobats, fireworks, and chants of “treasure your life” and “care for each other to build a wonderful future.”2
But there was a darker side to the Foxconn reaction, too. The company tried to limit its liability for future deaths by requiring employees to sign disclaimers saying “Should any injury or death arise for which Foxconn cannot be held accountable (including suicides and self-mutilation), I hereby agree to hand over the case to the company’s legal and regulatory procedures. I myself and my family members will not seek extra compensation above that required by the law so that the company’s reputation would not be ruined and its operation remains stable.” Worker outrage soon led it to abandon the effort. The company also began moving production from Shenzhen to new factories in the interior of China, largely to lower wages but also believing that if its migrant workers—the vast majority of its employees—were closer to home they would be less likely to kill themselves. Finally, the company began putting wire mesh around the balconies and outdoor staircases at its dormitories and latches on upper-story windows to keep workers from jumping, while surrounding all its factory and dormitory buildings with netting twenty feet above the ground, so that if a worker did manage to leap they would not die. It used more than three million square meters of yellow netting in the process, almost enough to cover all of New York’s Central Park if a latter-day Christo got really ambitious. Foxconn’s Swiftian response—not to change a production regime that was leading young men and women to jump off buildings, but instead to try to catch them before they hit the ground—seemed a return to the warped utilitarianism of Charles Dickens’s Thomas Gradgrind, applied to factories so large that they made Manchester’s textile mills look like mom-and-pop shops.3
Although some of the stories about the Foxconn suicides noted the very large size of the factories involved, none mentioned that the company’s Longhua Science and Technology Park in Shenzhen, better known as “Foxconn City,” was, as far as can be determined, the largest factory, in number of employees, in history. Foxconn’s extreme secretiveness makes it impossible to be sure about even such basic information as the numbers of workers at its plants, but journalistic and scholarly accounts have reported that at the time Longhua had more than 300,000 employees, and by some accounts more than 400,000, dwarfing even such monuments to giantism as River Rouge and Magnitogorsk, which combined had far fewer workers than the Foxconn plant. A visiting Apple executive, finding his car stuck in a mass of Longhua employees during a shift change, declared, “The scale is unimaginable.”4
Though no other factory equaled Longhua in its number of workers, there are plenty of other supersized factories in East Asia. Foxconn itself owns many of them. In 2016, the company employed 1.4 million employees in thirty countries, over a million of whom worked in factories in China that ranged in size from eighty thousand to several hundred thousand workers. A second Foxconn factory in Shenzhen, run in close coordination with Longhua, employed 130,000 workers in 2010. One hundred and sixty-five thousand workers produced iPads at a Chengdu factory, a ten-square-kilometer complex several times larger than the Longhua campus. And at peak moments during 2016 an astounding 350,000 workers made iPhones at a Foxconn complex in Zhengzhou, one of the most populous factories in history.5
Other electronics firms also have very large factories in China. In 2011, after the trouble at Foxconn, Apple began shifting some iPad and iPhone production to Pegatron, like Foxconn a Taiwanese-owned firm. In late 2013, Pegatron had more than 100,000 workers at its Shanghai plant, including 80,000 living in overcrowded dormitories.6 Electronics plants with 10,000, 20,000, or even 40,000 workers are not unusual in China. Though small by Foxconn standards, they have more employees than almost any factory in the United States. The 2006 film Manufactured Landscapes, about Canadian photographer Edward Burtynsky, begins with a tracking shot moving slowly down the aisle of a factory in Xiamen City, Fujian Province, which housed some 20,000 workers making electric coffeepots, irons, and other small appliances. The shot goes on for nearly eight full minutes, giving a sense of the immensity of a factory with even just 20,000 workers.7
A few other industries in Asia besides electronics have very large factories. The Huafang Group, a leading Chinese textile producer, had one factory complex with more than a hundred buildings and 30,000 employees. A few toy factories also are very large.8 And there are some truly gigantic factories making sneakers and casual shoes.
The Foxconn of footwear is Yue Yuen Industrial (Holdings) Limited, a subsidiary of the Taiwanese firm Pou Chen Corporation, founded in 1969. A little more than an hour’s drive north of Foxconn City sits a Yue Yuen factory in Dongguan that in the mid-2000s had 110,000 workers, making it the largest shoe factory in history. Workers produced nearly a million pairs of shoes a month for international brands like Nike (which had offices inside the plant) as well as for Yue Yuen’s own YYSports brand, sold through a chain of company-owned retail stores in China. Like Foxconn City and many other Chinese factories, the plant included dormitories and dining rooms for its workers, as well as a reading room and disco built by Nike. Yue Yuen had five other factories in China, including three more in Guangdong Province. Pou Chen, which in 2015 had revenues of $8.4 billion, controlled shoe factories in Taiwan, Indonesia, Vietnam, the United States, Mexico, Bangladesh, Cambodia, and Myanmar as well. In June 2011, more than 90,000 workers went on strike at a Yue Yuen plant in Vietnam, probably the largest single-site strike anywhere in the world in decades.9
Two developments led to the latest chapter of factory giantism. First was the opening up, starting in the 1980s, of China and Vietnam to private and foreign capital, part of national efforts to boost living standards and embrace a modernity increasingly measured by global, largely capitalist, standards. Second was a revolution in retailing in the United States and Western Europe, as in many product lines merchants, rather than manufacturers, became the key players in design, marketing, and logistics. The convergence of these changes resulted in the construction of the biggest factories in history.
Twenty-first-century factory giantism in many ways resembles earlier moments of outsized industrialism, almost eerily so. But in some respects it is quite dissimilar, representing a new form of the factory behemoth. While contemporary Asian factory giants have built on past experience in their organization, management, labor relations, and technology, they play different economic, political, and cultural roles than earlier giant factories. Like the largest and most advanced factories in the past, today’s industrial giants embody the possibilities and horrors of large-scale industry. But they do so largely out of the spotlight, hidden rather than celebrated as factories once were.
Maoist Giantism
The giant factories built in China and Vietnam over the past two decades came after one of the last substantial efforts to reconceive the factory as a social institution. In the years following the victory of the communist forces in China in 1949, a complicated story of scale and struggle unfolded in the effort to modernize the country through industrialization. Fitfully, the Chinese communists experimented with new ways of organizing production, not content to simply transplant the factory as it developed under capitalism and Stalinism to revolutionary China. The attempts proved deeply controversial, contributing to divisions that nearly split the country apart and ultimately led to a radical political and economic reorientation.
At first, the factory story in communist China seemed like a rerun of the Soviet experience, much like what was occurring in Eastern Europe. After a period of economic recovery following the end of the civil war, in 1953 the communist government, with Soviet advice, launched a Five-Year Plan. Following the Soviet precedent, China’s plan placed heavy emphasis on industry, which accounted for more than half the planned investment in the overwhelmingly agricultural country. Producer goods, especially the iron and steel, machine-building, electric-power, coal, petroleum, and chemical industries, had priority. Six hundred and ninety-four large-scale, capital-intensive projects were to be the driving force for economic growth, a quarter of which were to be built with Soviet assistance. China imported much of the machinery and equipment from the Soviet Union using short-term loans. Like Eastern Europe, China became an heir to an industrial tradition that had traveled from the United States through the Soviet Union, with a stress on specialized tasks and equipment, high-volume output, hierarchical management, and incentive pay.10
But even before their Five-Year Plan ended, Chinese leaders began edging away from the Soviet model. First they rejected “one-man management” of factories, seeking broader party and worker involvement, and began abandoning individual incentive pay. Then, in the preliminary planning for a Second Five-Year Plan, priority shifted from huge, capital-intensive projects to smaller-scale, more widely distributed plants, seen as more appropriate for China’s limited financial capacity.
The Second Five-Year Plan never was completed because of a more radical departure, the Great Leap Forward, launched in 1958 in an effort to accelerate economic growth through mass mobilization and decentralized innovation. The Great Leap Forward had a deeply disruptive, antibureaucratic thrust. In industry, the new policy embraced “walking on two legs,” continuing capital-intensive, large-scale, modern factory development while also promoting small-scale, labor-intensive, technologically simple industry that used local resources. Microindustry was meant to take advantage of underutilized rural labor and materials, serve agriculture, and provide inputs to large-scale industrial concerns. Most famous were the several hundred thousand very small “backyard” blast furnaces built across the country, which, along with small mines to feed them, at one point employed sixty million workers. Local initiatives took on a more prominent role in industrial development, while the importance of central directives diminished.
In addition to experimenting with factory scale, supporters of the Great Leap Forward also tried to break down the division between management and labor within the factory and the unequal distribution of power and privilege between them. In May 1957, the Central Committee of the Communist Party directed that all managerial, administrative, and technical personnel in factories spend part of their time directly engaged in productive activities, exposing them to the conditions, concerns, and views of workers. At the same time, workers were given greater opportunities to participate in the management of factories, or at least to have some say over the behavior of managers. Periodic congresses of workers evaluated managerial action while wall newspapers provided a more immediate outlet for criticism. Some administrative tasks, including accounting, scheduling, quality control, job assignments, and discipline, were shifted from managers to teams of workers. To enable workers to engage technical and administrative issues in an informed way, the country launched a massive program of technical education, reminiscent of the Soviet Union during the 1930s.
The efforts to create small-scale rural industry and give workers greater say over factory management reflected a Maoist belief in the centrality of popular mobilization to economic development and building socialism. But the Great Leap Forward, including its radical experiment with industrial scale, proved a disaster. Output of some goods soared, but they were of such low quality and often in unneeded varieties that they proved virtually useless. Meanwhile, pulling labor out of agriculture to local industry, along with the chaos that came with a weakening of central planning and wild misestimates of upcoming harvests, led to a severe famine. Even the strongest backers of the Great Leap Forward, including Mao, had to acknowledge that economic growth could not be achieved simply through mass mobilization.
Yet even as the Chinese leadership shut down most of the backyard iron furnaces, reasserted central control, and put experts back in charge of industry, experimentation continued, promoted particularly by Mao, in an effort to avoid what were seen as the flaws in the Soviet model and the hardening of hierarchy and bureaucracy at the expense of communist ideals. While again embracing industrial giantism as a path of national development, Mao hoped to grant large enterprises considerable autonomy in order to diminish the complexities and rigidities of central planning and create an environment for greater worker involvement in management.
The Anshan Iron and Steel Company, along with the Daqing Oil Field, became a model for the leftist approach to industrial management promoted by Mao. Anshan, located in the northeast, had been one of the two largest steelmakers in precommunist China, expanded with Soviet help during the First Five-Year Plan. In 1960, Mao approved a “constitution” for the management of the mill, supposedly written by its workers. Though its details were not published, its general principles stressed putting politics in command, relying on mass mobilization, bringing workers into management, avoiding irrational rules and regulations, and creating work teams that joined together technicians, workers, and managers. The “Anshan Constitution” was presented explicitly as a counter to the management approach at Magnitogorsk, which subordinated workers through restrictive rules and regulations.11
Giant industrial enterprises, Mao believed, could become anchors for new social arrangements. Rather than simply pouring out a narrow range of goods, a steel plant could also operate machinery, chemical, construction, and other enterprises, in effect becoming an all-purpose commercial, social, educational, and even agricultural and military organization. The factory would be the core of an all-encompassing community, going beyond even the expansive role of large factories in the Soviet Union and Eastern Europe. The Daqing Oil Field, like Magnitogorsk, developed in what had been a sparsely settled area, presented an opportunity to conceive a new type of settlement to break down the urban-rural divide. Unlike at Magnitogorsk, where the Soviets built a new city along conventional lines, at Daqing the Chinese developed dispersed residential areas, while providing support for agricultural production and a range of social and educational services.12
Mao believed that the key to the advance to a socialist society, with both greater equality and more rapid growth, lay in the relations of production, not simply in the level of material development. Who ruled the factory made all the difference. But there were plenty of critics among Chinese leaders as a debate unfolded in the late 1950s and early 1960s—somewhat reminiscent of the debate in the Soviet Union during the 1920s—over economic policies and industrial practices. Many Chinese leaders, in the wake of the Great Leap Forward, rather than promoting enterprise self-sufficiency and worker self-rule, called for greater specialization of enterprises and workers and greater use of material incentives.
Minister of Labor Ma Wen-jui represented one side of the debate when in 1964 he argued—much like Trotsky four decades earlier—that modern industry, with its complex machinery and coordinated activity of large numbers of workers, required a particular form of organization, regardless of whether it operated in a capitalist society or a socialist one. Maximizing output “to satisfy the needs of society” remained the “basic task” of state-owned enterprises. Socialism eliminated the inherent class conflict within the factory under capitalism because all output was for the benefit of society as a whole—workers and managers no longer had different interests. But the actual internal organization of the factory need not differ significantly from capitalist models. Ma endorsed worker involvement in overseeing managers but did not anticipate eliminating the distinction between them.
For others, though, a change in ownership constituted only the first step in the transformation of the factory and the larger society. Politics, they argued, needed to take command inside the factory as well as outside of it, promoting not only greater equality but also “the revolutionization of man.” Socialism should lessen the distinctions between mental work and manual work and between manager and worker. Practically, that meant requiring everyone associated with the factory to do some physical labor, bringing workers into administrative and leadership bodies, and having the Communist Party oversee factory management. Workers might continue to engage in highly specialized activities within a detailed division of labor, but that would not be all they would do. With their colleagues, technical personnel, and political cadre they would join with managers in determining all aspects of plant operation.13
The Cultural Revolution that began in 1966 intensified the struggle over who should run the factory and what it should be doing. The factory, though slow to be drawn into the escalating political strife, eventually became a center of battle as the turbulent political climate encouraged attacks on entrenched factory leaders and the powers and privileges they enjoyed. Worker critics and their allies challenged what they saw as bloated bureaucracies, full of officials doing little of real use, while workers were locked out of participation in such key areas as technical innovation. More radically, supporters of the upsurge questioned the notion that the factory should be understood simply as an economic unit responsible for maximum production. Harking back to Mao’s view during the Great Leap Forward, they argued that the factory should be a social institution, serving the multiple needs of its workers and the surrounding community, even at the cost of diminished production and profit. Some pushed for the despecialization of factories, especially in rural areas, so that their equipment and expertise could be used to serve local needs and make varied products for local consumption, rather just a narrow range of products for the national market.
The period of radical experimentation proved short-lived. As political conflict in schools, government agencies, and factories intensified and threatened to spin completely out of control, top communist leaders moved to reassert their authority using the army as their agent, as local Communist Party units were hopelessly sundered. As order was restored, so was hierarchy, though with great variation from factory to factory, as some degree of worker participation in management and experimentation with organizational forms continued. Still, the shift in the tide was clear.14
“Feeling the Stones”
The Cultural Revolution led to a break between the first Chinese industrial revolution, based on capital-intensive, state-owned enterprises making producer goods like steel and petrochemicals, and a second, based on labor-intensive consumer-goods manufacturing by privately owned enterprises. The chaos of the Cultural Revolution, followed by Mao’s death in 1976, left an opening for reformers, led by Deng Xiaoping, who sought to revive the stagnant Chinese economy and improve Chinese life. In many cases themselves victims of the Cultural Revolution, the reform leaders rejected basic Maoist tenets, including the centrality of mass mobilization and the need to reject all capitalist forms of organization. By the late 1970s, many communists came to believe that China’s continuing poverty, and its lag behind not only developed Western countries but also rapidly developing Asian nations like Singapore, stemmed from the country’s lack of markets.
To stimulate growth, the reformers sought at least the limited introduction of markets. They also pressed for a shift away from state investment in heavy industry. Somewhat like Bukharin and others in the Soviet Union a half century earlier, they argued that labor-intensive production of consumer goods would provide a more effective path to economic growth and rising living standards in a country lacking in capital but with plenty of underutilized labor. Over time, funds generated by light manufacturing could be channeled into more advanced, capital-intensive endeavors.15
Deng and his allies sought foreign capital and expertise to help expand industry without having a long-term blueprint. Instead, Deng called for “crossing the river by feeling the stones.” As an experiment, in 1979 the government established “special economic zones” in Guangdong and Fujian provinces, designed to attract foreign businesses. Within these zones, firms would be taxed at lower rates than elsewhere in the country. Additionally, companies could obtain tax holidays of up to five years; repatriate corporate profits and, after a contracted period, capital investments; import duty-free raw materials and intermediate products going into export products; and pay no export taxes. Local authorities within the zones were granted considerable autonomy and generally aligned themselves with the privately owned businesses being courted. Seen as a success, additional special zones were established over the course of the 1980s in other coastal areas and, in 1990, in the Pudong New Area of Shanghai. Two years later came a new set of zones in other parts of the country.16
During the 1980s, Chinese leaders came to share the cultlike faith in the power and efficacy of markets associated in the West with Margaret Thatcher, Ronald Reagan, and their followers. The dream of modernity in China, wrote Hong Kong–based social scientist Pun Ngai, became associated with “the great belief in capital and the market,” a one-hundred-and-eighty-degree shift from the prior belief that socialism represented a more advanced phase of history. “Search for modernity” and “quest for globability” became catchphrases as the marketization of a once almost completely socialist economy began.17
A similar swing took place in Vietnam. The long war with the United States, the subsequent wars with Cambodia and China, and the international boycott after the Cambodian conflict had severely drained the Vietnamese economy. Communist leaders had great difficulty integrating the capitalist economy in what had been South Vietnam with the socialized economy in the North. Measured by per capita income, Vietnam was one of the poorest countries in the world.
In an attempt to revive the southern economy, in 1981 and 1982 local authorities allowed Chinese merchants in Saigon to resume their activities, leading to a burst of prosperity. By 1986, the communists who had led the Saigon effort had won national-leadership positions, promoting pro-market reforms. The Doi Moi (“renovation”) policy, meant to move Vietnam toward a “socialist-oriented market economy,” included reforms in the state sector and opening up the country to foreign investment, market activity, and export industry. As in China, ideological change accompanied the shift in practical policies, with the Communist Party speaking of the objective laws of the market with a certainty once reserved for the virtues of central planning. Membership in the World Trade Organization (WTO) in 2007 deepened Vietnam’s integration into global markets and further facilitated export manufacturing.18
In China, the new market-oriented policies rapidly transformed the Pearl River Delta region in Guangdong. The region was selected as one of the first special economic zones because of its relative isolation from the major population and power centers of the country and its proximity to Hong Kong and Macao, and that proved critical to its success. At the time, the economy of Hong Kong (still under British control) depended heavily on manufacturing, trade, and transportation. With land and labor costs rising, the opening up of the adjacent part of the People’s Republic provided an opportunity to shift manufacturing to a much lower-cost area with which many Hong Kong businesspeople had family ties. At first, Hong Kong–run businesses largely aimed their operations within China at its domestic market, but by the middle and late 1980s, as the Chinese government eased restrictions on direct foreign investments, export-oriented manufacturing became increasingly prevalent, first in the garment industry, then in footwear and plastics, and finally in electronics.
The Hong Kong–Guangdong combination proved a remarkable profit machine, reflecting the advantages for capitalists of uneven global development. Hong Kong businesses, in many cases with extensive experience in international trade, initially moved their simplest, most labor-intensive operations to the People’s Republic, taking advantage of far lower labor and land costs and the free reign they were given in managing labor relations. They kept their administrative, design, and marketing operations in Hong Kong and used the territory’s advanced infrastructure, including the world’s busiest container port and extensive airfreight capacity, for exporting Chinese-made goods. As the authors of a study of the Pearl River Delta put it, “Third World level costs are combined with First World caliber management, infrastructure, and market knowledge.”19
As the initial Hong Kong–based forays into manufacturing in China proved successful and the Chinese government further loosened regulations and spent heavily on infrastructure serving the special economic zones, more investment flowed in. Hong Kong firms began shifting more complex manufacturing processes, logistics, quality control, sourcing, and packing to China. At the same time, companies based in Taiwan began manufacturing in mainland China, too, soon followed by companies from Japan and Korea, at first almost always operating through Hong Kong or Macao middlemen. Many of the Taiwanese firms were headed by executives with family ties to the mainland. Terry Gou, head of Foxconn, which built its first Chinese plant in Shenzhen in 1988, was a charismatic army veteran whose family came from north-central China and whose father fought with the Kuomintang before fleeing with Chiang Kai-shek to Taiwan in 1949. Once the United States granted China permanent normal trade relations in 2000 and China joined the WTO the following year, American companies began shifting manufacturing operations to China as well.20
A measure of the explosive growth of export-oriented Chinese manufacturing can be seen in the dizzying rise of Shenzhen’s population, which shot up from 321,000 in 1980 to more than seven million in 2000, one of the most rapid urban growths in history. Most of the new residents were migrants from elsewhere in China who came to work in the factories that were popping up all over.21 With the local labor pool quickly exhausted, a system of migrant labor developed that has been central to China’s second industrial revolution and which has made possible the hyper-giantism of twenty-first-century Chinese manufacturing.
Soviet and Eastern European factories recruited peasants displaced by the collectivization of agriculture. In China, it was the decollectivization of agriculture that freed up a workforce no longer ensconced in the benefits and obligations of the collective farm. After Mao’s death, communal farms were broken up, with small parcels of land leased to individual farmers under the “household responsibility system,” which allowed them to sell produce exceeding quotas on the open market. Initially, the new system brought a rapid boost to the rural standard of living. But further changes, including opening the country to food imports and rising costs for health care, education, and other social benefits, left the countryside far poorer than the cities. Many children from farm families, seeing limited economic and social opportunities at home, moved to the new export-oriented manufacturing centers to take factory jobs.
But usually only temporarily. Unlike those in England or the Soviet Union, Chinese peasants were not dispossessed of their property; though the state continued to own all agricultural land, thirty-year leases gave families effective control. Workers could and did move back and forth between farms and factories, knowing that they had something to return to in their home villages.22
In most cases they had to return home, like it or not, because of the Chinese hukou system of residency permits, instituted in the 1950s. Chinese citizens need a permit to live in particular areas and most social benefits, including health care and public schooling, are linked to the specific hukou they possess. Migrant workers received temporary residency permits arranged by their employers, which expired when they left their jobs. Obtaining a permanent shift of residency permit to a city was all but impossible. For the first generation of migrant workers, factory jobs (and urban construction work and service jobs) were necessarily interludes, usually lasting a few years, often between the time of finishing or dropping out of school and beginning a family, much as had been the case for New England mill workers.23
Migrant factory workers had a different and inferior social status than workers in state-owned enterprises. Until reforms that began in the late 1980s, state-owned and collective employers in China provided a broad range of benefits, including permanent job tenure, training, housing, lifetime medical care, pensions, and other welfare provisions, even subsidized haircuts. Generally, the intensity of work was light and managerial discipline minimal.24 This was not the case in the privately owned factories that blossomed as the state-owned enterprises began to shrink. Job turnover in the special economic zones was astoundingly high. Many companies provided dormitory housing to migrant workers for free or a fee but otherwise took no responsibility for their welfare. Whatever benefits workers were eligible to receive—including educational opportunities for their children and pensions—came from their home area, where they were registered under the hukou system. Private employers were legally required to contribute to social benefit funds for their workers, but like minimum wage and overtime regulations the requirement was frequently ignored. The intensity of work in private-sector factories was high and discipline harsh.25
In effect, China developed two quite different systems of factory production, one state or collectively owned, the other privately owned, with different informing ideologies, laws, customs, standards of living, and workforces. Even the terminology for workers differed. Employees at state enterprises were gongren (“workers”), holding, at least in theory, the highest social status in China during its communist heyday. Rural migrant workers, by contrast, were often called by newly coined terms dagongmei or dagongzai (“laboring girl”) or (“laboring boy”) with the connotation of hired hand, a low-status appellation.26
The migrant labor system provided employers with a vast workforce, expandable and shrinkable at will. The pool of rural young men and women was so large that it took nearly two generations before labor shortages began. And it was a pool of cheap labor. Most factories paid migrant workers the legal minimum wage (which in China is set by local governments) or less, as enforcement generally was minimal. Recruiting out of a rural labor market, where living standards and wages were far below urban norms, the coastal export factories did not have to match wage levels for local workers or what state-owned enterprises paid, able to attract workers because the low wages they offered were substantial by village standards. Furthermore, because the factories did not pay for most social welfare benefits for their workers, they were effectively being subsidized by the rural governments that did, allowing their labor costs to be below the cost of social reproduction in the areas they were located. Like Stalinist industrialization, Chinese industrialization has depended on squeezing wealth out of the countryside.27
Lodging workers in company dormitories was both a necessity and an advantage for big export factories. Migrant workers, because of housing shortages in the factory boomtowns and their lack of permanent resident status, often had difficulty finding lodging. To attract workers, factories provided it themselves, just as the Lowell mills and the Soviet industrial giants had done. Doing so allowed them to pay workers less than they would have to if those workers had to obtain housing on the open market.
In the early years of private factory growth, most of the migrant workers were young women, so lodging them in company dorms also had an element of providing a chaste environment. One large electronic firm required as a condition of employment that all young, unmarried, single women live in dormitories within the factory complex. Even after men began to be hired for production jobs, dormitories generally remained sexually segregated.
The dormitory system gave companies extraordinary control over their workers. As in the Lowell-style mills, many Chinese factories had (and have) detailed rules for behavior, imposing fines not only for being late to work, poor-quality work, or talking on the job but also for littering or leaving dormitory rooms untidy. Foxconn forbids workers of the opposite sex from visiting one another in their rooms, bans drinking and gambling, and imposes a curfew.
Having workers in company housing allows factories to mobilize large numbers of workers rapidly when rush jobs come in and makes it easier to have large numbers of young women working night shifts. Extremely long working hours—sometimes twelve hours at a time or more, a common practice, especially during busy seasons—are easier to demand if workers live right at the factory.28
In the mid-1990s, there were an estimated 50 million to 70 million migrant Chinese workers. In 2008, 120 million. By 2014, more than 270 million, nearly double the number of employed civilian workers of any kind in the United States, an oceanic movement of population from farms to factories and back.
Hometown networks play an important role in the movement, as migrant workers tell sisters and brothers and neighbors about the opportunities and city life and help them find jobs. Provincial and local governments have facilitated the flow. Interior provinces helped recruit workers for factory labor elsewhere, prizing the remittances they sent back home. Some local governments set up offices in Shenzhen to connect workers from their region to foreign-owned factories. Without active state support, the whole system would not have been possible.
The urban employment of rural workers has turned the Spring Festival week around Chinese New Year into an epic of logistics, emotion, and labor recruitment. Each year, millions upon millions of migrant workers return home for the holiday, to be reunited with parents, children, and village friends, in what has become the world’s largest, regular human migration. In 2009, the Chinese railway system expected to carry about 188 million passengers during the holiday period. Huge crowds fill stations and spill over into neighboring streets. Ticket systems crash under the weight of demand. Trains and buses are crammed and overcrammed with people and baggage (though the recent expansion of the Chinese railroad system has somewhat eased the chaos). When the holiday ends, not everyone goes back. Each year, millions of migrant workers decide to stay home, forcing factories and other employers to scramble to find replacements.29
Why So Big?
Migrant labor made possible the rapid expansion of export-oriented manufacturing in China—and also Vietnam—but it does not explain the creation of factories larger than any ever seen before.30 For the most part, their size is not a result of technical requirements of production. Look at a photograph of a large sneaker factory in, say, Vietnam and what you will most likely see will be rows of workers sitting at individual workstations assembling precut pieces. (Sneakers and casual footwear are made by gluing and stitching together pieces of rubber, synthetic fabrics, synthetic leather, and sometimes actual leather.) Masses of workers may be under the same roof, but for the most part their labor is individual or in small groups, doing work identical to other individuals or groups nearby, without interacting with them.31 In this respect, these plants are less like River Rouge or Magnitogorsk and more like the early English textile mills, where weavers or spinners stood side by side doing individual tasks.
Even when products require more complex assembly, there is often no clear relationship between the number of workers needed to make a particular product and the size of a factory. In the EUPA factory, the Taiwanese-owned small appliance plant featured in Manufacturing Landscapes and one of Edward Burtynsky’s best-known photographs, assembly workers are housed in a vast, modern, single-story shed. But each assembly line within it is short and relatively simple. Thirty lines made electric grills, but each had an average of only twenty-eight workers, not the hundreds found on integrated assembly lines in automobile or tractor plants. Rows of assembly workers face each other across a slowly moving belt. For the most part they use simple hand tools, without mechanical pacing of production, taking pieces on and off the belt rather than working on moving components, as in an auto plant.
Figure 7.1 Workers making Reebok shoes in a factory in Ho Chi Minh City, Vietnam, 1997.
Electronics firms are notoriously secretive, so it is difficult to get a full sense of their manufacturing processes. But one account of an Apple production area within the Foxconn Longhua complex described assembly lines ranging from dozens to more than a hundred workers each, larger than the lines in shoe or small appliance factories but still very modest in size compared to the overall size of the factory, with its several hundred thousand workers.
Vertical integration adds to plant size. Some footwear plants make the synthetic materials that go into sneakers and shoes, mold and cut pieces, and embroider logos. EUPA manufactures most of the parts used in the goods it produces. Foxconn makes some of the components that go into the devices it assembles, though most of the high-end elements come from elsewhere.
Still, even adding in parts manufacturing, technological requirements do not explain giant plant size. Rather it is like Alfred Marshall’s comment about cotton spinning and weaving, that “a large factory is only several parallel smaller factories under one roof.” At Foxconn City, that was almost literally the case, with separate buildings used to assemble similar products for different companies.
Beyond some point, economies of scale in production diminish or disappear. In his classic study Scale and Scope Alfred D. Chandler, Jr., after noting that at one point close to a quarter of the world’s production of kerosene came from just three Standard Oil refineries, wrote: “Imagine the diseconomies of scale that would result from placing close to one-fourth of the world’s production of shoes, textiles or lumber into three factories or mills! In those instances the administrative coordination of the operation of miles and miles of machines and the huge concentration of labor needed to operate those machines would make neither economic nor social sense.” Yet something close to that has happened in the production of electronic devices and some types of footwear. In the case of Apple, production concentration has gone beyond what Chandler imagined as absurd; every iPad is assembled in a single factory and most iPhone models in just one or two.32
Why are the factories so large? The answer seems to lie in economies of scale and competitive advantages, not for manufacturers, but for the retailers that sell the products they make. This reflects a fundamental shift in relations between the two parties. Until fairly recently, the design, manufacture, and marketing of consumer products generally occurred within the confines of one company. But since the 1970s they have been delinked. And, as sociologist Richard P. Appelbaum has argued, in contemporary global supply chains it is retailers and branders (designers and marketers that depend on others for manufacturing) who have the most power to establish the arrangements and terms of production, not factory owners. Factory giantism serves their interests.33
Early in the history of factory production, some of the most successful manufacturers established their dominance by selling their products under brand names and controlling distribution networks. In the United States, the Lowell mills pioneered this approach, which was adopted by such iconic companies as the McCormick Harvesting Machine Company. The Singer Manufacturing Company extended the model to a global scale, as its salesmen and distribution agents sold sewing machines across Europe and the Americas, largely produced in just two factories. The big automobile manufacturers used the model as well, selling cars that they branded—Fords and Chevys, Chryslers and Cadillacs—through independently owned dealerships that they effectively controlled. General Electric, IBM, and RCA likewise sold or leased their products under their own names and exerted considerable influence, if not total control, over distribution networks.
The manufacturer-dominated system of branded products stayed in place in Europe and the United States through the 1970s. Goods producers like Volkswagen, GM, Siemens, Sony, Ford, Whirlpool, Levi Strauss, and Clarks shoes (which first garnered wide attention when its products won awards at the 1851 Crystal Palace exhibition) persisted as household names. The companies, their products, and the factories that produced them remained tightly bound to one another in reality and image.34
The severe global recession of the 1970s and a series of subsequent developments unraveled the ties. With profit rates declining as a result of increased international competition, rising energy and labor costs, tight credit, and inflation, many American corporations, under pressure from corporate raiders, sought to reduce costs and shed less profitable operations. To become leaner and more flexible and show a rapid drop in spending, they began outsourcing to other firms functions they had traditionally performed themselves. They tended to start with support services, such as data processing and communications. But over time, companies began outsourcing core functions, too, including manufacturing.35
Take sneakers. From their introduction in the nineteenth century through the 1960s, sneakers generally were designed and made by the same companies, mostly large, stodgy rubber firms like United States Rubber Company (Keds) and BF Goodrich (PF Flyers). But then dominance shifted to companies like Adidas, Puma, Reebok, and Nike that were built around athletic footwear and clothing rather than rubber and focused on technological innovation, fashionable design, and marketing. While into the 1980s most of the industry leaders, including Nike, did at least some of their own manufacturing, increasingly they contracted out production, until they became essentially just branders.36
In the electronics and computer industries as well, leading corporations began contracting out some of their manufacturing. Sun and Cisco, two Silicon Valley success stories, worked with specialized contract manufacturers, like Solectron and Flextronics (before the rise of Foxconn, the largest such firm), to manufacture advanced products, sold under their brand names. Some companies, including IBM, Texas Instruments, and Ericsson (a large Swedish telecommunications manufacturer), sold off individual factories or even whole manufacturing divisions to smaller firms, with which they then contracted to do their manufacturing. Over time, contract manufacturers became increasingly sophisticated in their design and logistics capacities, partnering with their clients in integrated, multifirm production systems, stitched together by electronic data communication.37
During the same years, a revolution in selling took place as well. It had two facets, the rise of new, giant, low-price retailers and the burgeoning of global brand companies that did little or no manufacturing themselves.
In the United States, the new mass retailers had their origins in the 1960s, when a series of discount store chains, including Wal-Mart and Target, were founded. But it was not until the 1980s that they really took off. Wal-Mart, using a combination of low-wage labor, low prices, advanced technology, and highly efficient logistics, grew into the largest retailer in the world. In 2007 it had 4,000 stores in the United States and 2,800 elsewhere. Though no company came even close to Wal-Mart in size, other retailers based in Europe and the United States, like Carrefour, Tesco, and Home Depot, ballooned through expansion and acquisitions.
With their massive purchasing power, giant retailers won an edge over their suppliers, whether well-known companies like Levi Strauss or obscure firms that made products sold under the retailers’ house labels. New communications and logistics technology, including bar codes, computer tracking systems, and the internet, allowed retailers to monitor, communicate with, and direct suppliers on an almost instantaneous basis. Faced with the possibility of the loss of massive orders, companies that made goods for megaretailers were at their mercy and often restructured their operations to meet their needs and desires.38
A parallel process developed in the growth of branded product companies like Apple, Disney, and Nike. Such firms achieved massive global sales by concentrating on product design and, above all else, marketing, making their products symbols of hipness, worldliness, modernity, and fun. Some of the big brands at one point or another did some of their own manufacturing, but typically they eventually outsourced most or all of the production of the goods they sold. Koichi Nishimura, the CEO of Solectron, in 1998 said of his customers that “The more sophisticated companies work on wealth creation and demand creation. And they let somebody else do everything in between.” Apple initially manufactured its own products, some in factories near its Silicon Valley headquarters. But in the mid-1990s it began selling and shutting down plants, contracting out almost all of its physical production. In 2016 Apple made only one major product, a high-end desktop computer, in the United States. Similarly, in the 1990s Adidas, which had made most of its footwear in factories in Germany, began getting out of the manufacturing business, closing down all of its plants except for one small operation it used as a technology center.39
One advantage of contracting out manufacturing was that it distanced brand companies from the work conditions under which their products were made. Seeking lower labor costs usually meant relocating manufacturing to low-wage regions, often with autocratic or corrupt governments; avoiding unions; and paying less attention to worker health, safety, and well-being. If child labor, excessive hours, use of toxic chemicals, repression of unionists, and the like took place within the facilities of a brand company, its image—its most important asset—might well be damaged. But if the problems could be blamed on a contractor down the supply chain, the damage would be less costly and more easily contained. Nike and Apple were both able to survive with remarkably little long-term harm revelations about work conditions and worker treatment in the plants that made their products by blaming contractors, promising better oversight and more transparency, and issuing new codes of conduct.40
The location and size of the contract factories serving large retailers and brand companies varied greatly and changed over time. Early on, many American electronic companies contracted with local firms, some in or near Silicon Valley, to build their products. But logistical and political changes made it ever easier to locate manufacturing plants at great distances from contracting firms. Container shipping and expanded airfreight capacity increased the speed and lowered the cost of shipping. Cheap international telephone rates, satellite connections, and the internet improved communications. Lower tariffs reduced the surcharge on manufacturing across borders.
As retailers and brand-name firms like Wal-Mart and Apple relentlessly pressured their suppliers and subcontractors to lower their prices, firms scouted the world for low-wage regions to locate their factories. Mexico was one favored site. So, following the collapse of Soviet communism, were Eastern European countries. Textile and garment manufacturers built plants in Central America, the Caribbean, South Asia, and Africa. Malaysia, Singapore, and Thailand attracted contract electronics manufacturers. And, more and more, manufacturers looked to China to locate their plants, with its vast, cheap labor pool and cooperative government authorities.41
The staggering size of orders from transnational corporations like Hewlett-Packard, Adidas, and Wal-Mart made it convenient for them to depend on concentrated production centers, minimizing the administrative and logistical tasks that would result from using many widely scattered suppliers. The changed economics of shipping made it possible for them to concentrate manufacturing in a single small region or just a single factory. In the nineteenth and twentieth centuries, even companies known for centralized, vertically integrated production, like Ford, set up branch plants to assemble products for markets distant from their main factories. But the radical reduction in shipping costs and increase in shipping speed, largely as a result of container shipping and highly efficient port logistics, meant that companies like Apple could supply a particular product to retail stores and internet customers around the world from just one or two locations.42
Concentrated production did not necessarily mean big factories. Sometimes it meant industrial districts or centers where many small plants and ancillary services clustered together. In the mid-2000s, over a third of the world’s socks—nine billion pairs a year—were produced in Datang, China, not by one company but many, supplying retail giants, including Wal-Mart. Production of neckties began in Shengzhou, China, in 1985 when a Hong Kong company moved its production there. Soon various managers left to start their own companies and tie production grew until the city became the global leader, able to meet orders of hundreds of thousands of units at a time. At one point Yiwu, China, had six hundred factories where workers, who in many cases did not know what Christmas was, produced over 60 percent of the world’s Christmas decorations and accessories.43
But sometimes scaling up meant just one giant factory. For some products, including footwear and electronics, big buyers, especially brand marketers, have preferred very large factories, which can consistently provide the vast quantity of goods they sell and quickly gear up to make new products or meet rush orders. Apple represents this tendency taken to the extreme. It produces only a very limited number of products but in mind-boggling quantities. Its marketing strategy depends on carefully choreographed, highly publicized annual or semiannual product introductions, stimulating global stampedes by consumers eager to get the newest product and demonstrate their position on the leading edge of technology, style, and modernity. In June 2010, Apple sold 1.7 million iPhone 4s in the three days following its introduction. In September 2012, it sold five million iPhone 5s on the first weekend of sales. Three years later, the company sold more than thirteen million iPhone 6 and 6 Plus units during the first three days after launch. With final product design often locked up only shortly before sales begin, Apple needs to mobilize a vast amount of labor in a very short time to produce inventory for the sales rush to come. Factory giantism has been the solution Apple has adopted, though the giant factories are not its own.
Using giant contract manufacturers, like Foxconn and Yue Yuen, has allowed Apple, Nike, and their ilk to operate without large standing inventories of products that tie up capital and run up warehouse expenses. Even more important, just-in-time production avoids the possibility of being stuck with piles of outdated cell phones, laptops, or sneakers in what are essentially fashion industries. Tim Cook—the Apple executive who masterminded the company’s shift from in-house production to contracting out before succeeding Steve Jobs as CEO—once called inventory “fundamentally evil.” “You kind of want to manage it like you’re in the dairy business. If it gets past its freshness date, you have a problem.”44
Foxconn and Pegatron keep Apple’s milk fresh by rapidly mobilizing hundreds of thousands of young, poorly paid Chinese workers, often under harsh conditions (perhaps closer to evil than inventory). In 2007, just weeks before the scheduled unveiling of the first iPhone, Jobs decided to switch from a plastic to a glass screen. When the first shipment of glass screens arrived at the Foxconn Longhua plant at midnight, eight thousand workers were awoken in the dormitories, given a biscuit and a cup of tea, and sent off to begin a twelve-hour shift fitting the screens into their frames. Working around the clock, the plant was soon pouring out ten thousand iPhones a day. On occasion, to fulfill an order, Foxconn moved large groups of workers from one factory to another in an entirely different part of the country. Meeting surges of demand requires not only a vast army of labor but also a large corps of junior officers, thousands of industrial engineers to set up assembly lines and oversee them, something that China, with its massive program of technical education, can provide. It is this ability to quickly scale up (and, when the rush is over, quickly scale down) production that Apple and other customers prize in the giant contract manufacturing plants that have sprung up in East Asia.45
A combination of Fordism and Taylorism facilitates the rapid mobilization of unskilled workers. Apple is ideal for this approach, because it makes a very limited number of highly standardized products, just as Henry Ford did. Some of the final assembly procedures for Apple’s computers and mobile devices are highly automated, but most are not. Rather, they involve an extreme division of labor, very simple tasks repeated over, and over, and over again. Workers can be taught them in virtually no time—critical given the very high turnover of workers at factories employing Chinese migrant workers (who have no reason to be loyal to their employers and frequently switch jobs) and the need to bring on fleets of new employees rapidly when big orders come in. The orientation for new hires at Foxconn involves lectures about company culture and rules, but no training in actual production tasks.46
Many large contract manufacturing firms cope with big rush orders by subcontracting some of the work to small companies with which they have relationships. Rather than either/or, large and small factories often work in symbiotic relationships, with the bigger companies helping small ones, sometimes just family workshops, to set up as parts suppliers or as subcontract assemblers or processors. Such networks enhance the ability of big firms to quickly scale up production without adding to their fixed costs.47
Some contract manufacturers have preferred large-scale factories for their own convenience or out of a kind of corporate vanity, separate from the preference of their customers. The head of a firm that made cases for PCs and game consoles related that he preferred to buy land in low-wage areas close to major markets, build a large factory, and set up suppliers right there. Rather than many small factories, his company runs six big industrial parks spread around the globe. Yue Yuan built gigantic factories in part simply as a strategy to quickly raise its capacity to produce a vast volume of shoes in its successful quest to become the world’s largest footwear company. Foxconn’s Longhua plant grew very large out of a rush to scale up production, as well as to serve as a showcase for the company and its CEO, Gou. The manager of the complex felt it far too big for efficient operation. Most subsequent Foxconn factories have been considerably smaller, though still very large.48
Asian industrial giantism requires state support. In recent decades, the Chinese government has maintained the Soviet and early Mao-era view that very large concentrations of productive capacity are the quickest route to industrial advance and economic growth (a policy Vietnam has followed as well), with distributed, small manufacturing no longer a major thrust. Concentration has not necessarily meant giant factories. The Chinese government actively encouraged the creation of the sprawling clusters of small and midsize firms making specialized products, providing big parcels of land for development, creating industrial parks, building infrastructure and transportation, and providing tax benefits. But often it has meant outsized plants. One manager in the Chinese automobile industry, which is partially owned and heavily guided by government entities, told sociologist Lu Zhang “the government wants big firms. To achieve large scales and high volumes in a short time, we rely not only on highly advanced machinery, but also on our hard-working workers—our comparative advantage.” Provincial Chinese governments have embraced industrial giantism as a development strategy. Companies seeking to build large new plants have been offered land (sometimes for free), tax breaks, reduced-cost electricity, and help in recruiting a workforce (including student interns, an increasingly important source of cheap labor for manufacturers).49
Inside the Behemoth
What is it like to work in the industrial behemoths of modern Asia? In some ways, the experience is remarkably like that of factory workers generations and even centuries ago in England, the United States, and the Soviet Union. As was the case with nineteenth-century Lowell-style mills, many young women and men have been attracted to twentieth- and twenty-first-century Asian factories by the opportunity to earn money and help their families, build houses or pay for a sibling’s education, or amass savings to start a business or bring to a marriage (providing women some protection in case it goes bad). Some women sought to escape arranged marriages, patriarchal control, or family disputes. Just as in the Lowell-style mills, most workers returned to their home village after a few years of factory work to settle down to marriage and family in the countryside, farming or sometimes setting up small businesses.
But factory work in China has not only been a means to make money but also a way to escape rural provincialism and experience city life and what is seen as modernity. The first generation of migrant workers, in the 1980s and 1990s, had little idea of what to expect. Returning migrants were living billboards for a different world. One teenaged woman from an ethnic minority in Guangxi Province recalled that when young people from her village came back for the New Year celebrations in their new clothes, she was envious, echoing the experience of New England teenagers nearly two centuries earlier. She soon left to take a job in an electronics factory. Later migrants were more sophisticated, having seen images of city life and modern factories on television and become at least superficially familiar with fashion and fashionable products through smartphones. One young female worker from Hunan Province, who took a job in an electronics factory near Guangzhou, recalled “When I saw factories on TV, they always seemed so nice: well-built buildings, tiling, and a clean environment, so I thought it would be fun.”50
Going from the countryside to a factory hundreds of miles away, teeming with tens or even hundreds of thousands of workers, could be deeply disorienting. Recently industrialized Chinese cities do not look like modern equivalents of Manchester. Because so many low-paid workers live in company dormitories, there are not sprawling districts of slums. Some industrial centers, like Shenzhen, contain within them neighborhoods or villages filled with migrant workers and businesses serving them, which reproduce something of the feel of village life. But most new industrial regions are modern and large scale. Upriver from Shanghai, sociologist Andrew Ross reported “Spotless, newly laid highways reached out in all directions. Crowding out all the other buildings were the industrial newcomers—fat, squat warehouses with high-tech roofs, rows of factories as long as freight trains, and a multitude of postmodern boxes that carried the brand of their corporate owners but said nothing about what was done inside their walls.” Driving across Dongguan, Nelson Lichtenstein and Richard Appelbaum saw “broad but heavily trafficked streets, continuously bordered by bustling stores, welding shops, warehouses, small manufacturers, and the occasional large factory complex. This is how the cities of the old American rust belt must have once looked, smelled, even vibrated.”51
Simply finding the way around vast factory complexes like Foxconn City could be bewildering to teenagers who had rarely left their small villages, if ever. The Longhua plant covers over two square kilometers; it takes an hour to walk from one side to the other. Many signs at Foxconn plants were English acronyms, meaningless to newcomers. Frustration and anomie from sudden immersion in an alien world contributed to the rash of Foxconn suicides.
But there was excitement, too. Many migrant workers marveled at new sights and experiences. One worker from Hunan, assigned to a factory dormitory, recollected, “I had never lived in a multi-story building, so it felt exciting to climb stairs and be upstairs.” Just as had been the case in the Soviet Union in the 1930s, something as simple—and taken for granted—as a staircase could be the divide between two universes.52
The factory giants in China and Vietnam are not sweatshops. Generally, they are recently built and modern looking, though undistinguished. Inside they are mostly clean, orderly, and well lit. Some are air conditioned. As a rule, conditions, pay, and benefits are better in foreign-owned large factories than in locally owned small plants and workshops. And large factories are less likely than small ones to cheat workers out of what they are owed, a big problem in China.53
Still, work inside large factories often is difficult and the atmosphere oppressive. Many Taiwanese-owned industrial giants use quasimilitary discipline to control their workforces, full of newcomers. Workers at EUPA, Foxconn, and other large plants wear company uniforms. Plant security is intense. The entire perimeter of Foxconn City is walled, with barbed wire topping some sections. Like River Rouge, entry is only though manned security gates. Identification cards are necessary to enter most large factory complexes and sometimes again to enter particular buildings. At Foxconn plants, surveillance cameras are ubiquitous.
Foxconn puts particular stress on following detailed rules and work instructions—a kind of hyper-Taylorism—enforced by a multilayered management hierarchy. Line leaders, themselves poorly paid workers, supervise individual production lines, in turn overseen by layers and layers of higher-level supervisors. Workers are forbidden from talking on the job (though in practice enforcement varies greatly) or moving about the plant. Slogans adorn banners and posters on factory walls, some reminiscent of Alexei Gastev: “Value efficiency every minute, every second,” others more hyperbolic, “Achieve goals or the sun will no longer rise,” and still others crudely threatening, “Work hard on the job today or work hard to find a job tomorrow.”
At Foxconn and other foreign-owned factories in China, there is no echo of the experiments with worker involvement in management that took place in state-owned enterprises. The genealogy of the internal organization of modern Chinese factory giants lies in Western and Japanese systems of management, not in the earlier years of communist China. Hierarchy is unquestioned, rules and regulations extensive. Quality-control systems, imported from developed capitalist countries, further top-down organization.54
Assembly-plant jobs that require the rapid repetition of a series of motions for long periods of time are exhausting and even debilitating, reminiscent of early English textile mills where child workers suffered physical damage from doing the same tasks over and over again. At the Foxconn Chengdu plant, some workers’ legs swelled so badly from standing all day that they had difficulty walking. Extremely long working hours compound the problem. Though Chinese laws stipulate a normal workweek of forty hours and limit overtime to nine hours a week, factories routinely ignore them, scheduling much longer workweeks. Schedules of well over sixty hours are not uncommon. At Foxconn, workdays of twelve hours (including overtime) are common, but there and elsewhere, when order deadlines approach, workdays can stretch even longer. Foxconn workers switch between day and night shifts once a month, much like American steelworkers used to rotate shifts every two weeks, leading to sleep loss and disorientation. Though workers like extensive overtime for the boost it gives to their earnings, they have fought to control their hours and raise wages so that huge amounts of overtime are not necessary to make a decent living. At one giant Yue Yuen factory, workers found the mandatory overtime so exhausting that they struck in protest. Just as in Marx’s time, much of the struggle between labor and capital in today’s megafactories revolves around the length of the working day.55
Discipline is another point of contention. In many giant Chinese factories, discipline is harsh and degrading. Firms commonly impose fines for negligent work and even minor rule violations, like talking or laughing on the job, recalling English textile factories, where, Marx noted, “punishments naturally resolve themselves into fines and deductions from wages, and the law-giving talent of the factory Lycurgus so arranges matters, that a violation of his laws is, if possible, more profitable to him than the keeping of them.” (By contrast, fines as a form of labor discipline are illegal in Vietnam.) Some foreign managers believe that especially strict disciplinary measures are required in China because of a lax pace of work inherited from socialism, along with a culture of everyone “eating from the same rice bowl,” collective rather than individual effort and reward.
At Foxconn, supervisors verbally abuse workers for breaking minor rules. In one instance, a supervisor forced a worker to copy quotations from CEO Gou three hundred times—a cross between schoolhouse punishment and the Cultural Revolution. Security guards sometimes beat up workers suspected of theft or simply violating a rule (shades of the Service Department at River Rouge). Some Chinese factories hire off-duty policemen as guards, giving them a sense of impunity.56
Xu Lizhi, a Foxconn worker who committed suicide in 2014, addressed factory discipline in a poem, “Workshop, My Youth Was Stranded Here,” published in the company newspaper, Foxconn People:
Beside the assembly line, tens of thousands of workers line up like words on a page,
“Faster, hurry up!”
Standing among them, I hear the supervisor bark.
In “I Fall Asleep, Just Standing Like That,” he wrote:
They’ve trained me to become docile
Don’t know how to shout or rebel
How to complain or denounce
Only how to silently suffer exhaustion.57
Some giant Asian factories have had severe health and safety problems. In 1997, an internal report commissioned by Nike found serious problems with toxic chemicals in a large Korean-owned contracting plant in Vietnam. Levels of toluene in the air far exceeded both U.S. and Vietnamese standards. Pervasive dust and oppressive heat and noise added to the poor conditions. In China, too, exposure to toluene, along with benzene and xylene, created hazardous conditions in footwear factories. Chemical solvents used to clean screens are a hazard in electronics factories. Aluminum dust, from making and polishing cases for iPads, presents another danger; workers breathe it in and it can be highly explosive. A 2011 blast at the Foxconn Chengdu plant caused by the dust killed four workers and severely injured eighteen others.58
In Lowell, boardinghouses, centers of sociability and relaxation albeit strictly regulated by the companies, provided something of a respite from the monotony, fatigue, and regimentation of the factory. At many Chinese factories that is less the case. About a quarter of Foxconn’s Shenzhen workers live in company housing, one of the thirty-three dormitories inside its factory complexes or the one hundred and twenty dorms it rents nearby. Foxconn dorm rooms typically house six to twelve workers, more than housed in Lowell boardinghouse rooms, though unlike in Lowell, each worker has her or his own bunk bed. (Many Taiwanese-owned factories also have higher-grade housing for managers.) Workers are assigned to rooms randomly, so that friends, relatives, workers from the same production area, or workers from the same region rarely bunk together. With some roommates working day shifts and others at night, disruptions come regularly and rooms cannot be used for socializing. As in Lowell, strict rules regulate dormitory behavior: curfews are enforced, visitors restricted, and cooking forbidden.59
But many industrial giants, including some though not all Foxconn plants, have extensive on-site social and recreational facilities that provide opportunities for relaxation, socializing, and entertainment. Foxconn City, in addition to dormitories, production buildings, and warehouses, includes a library, bookstores, a variety of cafeterias and restaurants, supermarkets, extensive sports facilities including swimming pools, basketball courts, soccer fields, and a stadium, a movie theater, electronic game rooms, cybercafés, a wedding-dress shop, banks, ATMs, two hospitals, a fire station, a post office, and huge LED screens that show announcements and cartoons. In 2012, a central kitchen used three tons of pork and thirteen tons of rice every day to feed workers. Another company’s factory complex, where workers made small motors for electronic devices and automobile accessories, contained a skating rink, basketball courts, badminton fields, table-tennis courts, billiards, and a cybercafé (though workers complained about the lack of Wi-Fi in the dormitories).
At Foxconn City, the giant outdoor television screens and extensive shopping and recreational venues brought consumer modernity into the plant itself, offering workers a taste of the world they left their villages seeking. Migrant workers often quickly assimilate to it. Journalist James Fallows wrote after visiting Longhua in 2012, “At factories I’d previously seen across China, workers looked and acted like country people weathered by their rough upbringing. Most of the Foxconn employees looked like they could have come from a junior college.” Many second-generation migrant workers own—or are saving to own—the products they themselves make that symbolize modernity, like smartphones and stylish footwear and apparel.60
Militant Workers
Fallows sees China as a feel-good story, a country rapidly moving from working-class living conditions like those in William Blake’s England to those like in the United States in the 1920s, and continuing upward. Since China began allowing foreign entities to build and run factories, there has been an enormous decline in poverty, also the case in Vietnam. According to World Bank data, between 1981 and 2012 more than a half billion Chinese rose above a poverty line defined as living on the equivalent (in 2011 dollars) of $1.90 a day or less. Life expectancy at birth rose from sixty-seven in 1981 to seventy-six in 2014. Nonetheless, even at the most modern industrial giants in China and Vietnam, factories with pay and conditions above local norms, workers have repeatedly expressed their dissatisfaction through high turnover rates, strikes, and protests.
In recent decades, China has experienced a massive, if not well publicized, strike wave. The China Labour Bulletin details 180 strikes in 2014 and 2015 that involved a thousand or more workers, estimating that it has information on only 10 to 15 percent of all strikes that occurred. By contrast, during those same two years, there were only thirty-three strikes with a thousand or more workers in the United States.61
All kinds of factories in China have been hit by walkouts—large and small, state-owned and privately owned. Strikes have occurred at leading industrial giants in the electronic and footwear industries over pay, benefits, and working hours. Tactics, beyond stopping work, have included threatening suicides, blocking roads, and marching on government offices. With many strikers living in company dormitories, stoppages often become de facto occupations or sit-downs.
Even the largest contract manufacturers have been affected. In 2012, 150 workers at a Foxconn plant in Wuhan spent two days on a building roof threatening to jump off to protest a pay cut that accompanied their transfer from Shenzhen and conditions in the new plant. In the Spring of 2014, most of the forty thousand workers at a Yue Yuen factory in Guangdong Province struck to demand that the firm comply with a law obligating it to make pension contributions, one of the largest single-site strikes China has seen. Some protests have been violent. Workers at the Foxconn Chengdu plant rioted several times in fury over uninhabitable dormitory conditions and pay cuts. In one case, it took two hundred police officers to end the protest.
Chinese strikes occur in a legal gray zone. For years, workers had a right to strike, encoded in the constitutions of 1975 and 1978. But in 1982, as the government moved to attract foreign investment and reject the mass mobilizations of the Cultural Revolution, the right was removed from the fundamental law. Now workers cannot openly organize or publicize job actions. But they strike nonetheless. Most walkouts arise with little if any prior organization, no union involvement, and no clear leaders, and last a day or two at most. Often they end when the government intervenes to mediate.
As long as the stoppages are local, short, and nonpolitical, the government generally tolerates them. But if they get out of hand or last too long, physical force and arrests are used to break them up. Authorities want to make sure that labor turbulence does not drive away foreign investors or threaten the political status quo. For their part, foreign factory owners seem confident that the government will keep labor militancy under control, not hesitating to concentrate production in very large plants that if shut down would halt most or all production of particular goods.62
Strikes are even more common in Vietnam than China. Workers there have a legal right to strike, though in practice most walkouts have taken place without the elaborate steps necessary for authorization. Worker strikes hit large South Korean and Taiwanese-owned factories making shoes for Nike, Adidas, and other global brands in 2007, 2008, 2010, 2012, and 2015. The gigantic 2011 strike at the Yue Yuen factory, protesting low wages, captured international attention for its sheer size.
Even more startling were the riots three years later, which damaged or destroyed scores of foreign-owned factories outside of Ho Chi Minh City. The disturbances began with a rally of workers protesting China’s deployment of an oil rig into waters claimed by Vietnam. But the protesters soon turned against nearby sneaker and clothing factories, many of which were Taiwanese, South Korean, Japanese, or Malaysian owned, angry about stagnating wages and foreign exploitation. A staff person at the Taiwanese Chutex Garment Factory reported that some eight thousand to ten thousand workers were involved in an attack on the plant, burning “everything, all of the materials, computers, machines.”63
In China, worker militancy has pushed up wages and improved conditions, aided by pressure from international labor rights groups and brand companies afraid of their reputations being sullied by stories of worker abuse. Even so, by the 2010s large factories were having difficulty recruiting and retaining migrant workers. The rapid expansion of manufacturing, a shrinking rural population, a gender imbalance favoring men, and the growth of service-sector female employment meant that the pool of young women from the countryside that the factories preferred was effectively tapped out. Foxconn and other firms were forced to broaden their hiring practices, turning to men—who now constitute the majority of Foxconn employees—and older workers.64
Companies responded to rising wages and labor shortages by building new plants in lower-wage regions of central China. Many also turned to semicoercive measures to recruit and retain workers, echoes—though much attenuated—of practices from the earliest days of the factory. Some companies insisted that migrant workers make “deposits” to obtain their jobs, which would only be refunded if they left with permission of the firm. Similarly, companies withheld parts of workers’ wages, promising to pay them at the end of the year.65 Larger factories, under greater scrutiny and more attuned to international standards, were less likely to engage in such tactics. Instead, they turned to student interns as a new, cheap labor supply.
Chinese vocational schools require completion of a six-month or one-year internship before graduation. Foxconn and other firms have exploited this requirement by working with government and educational authorities to have large numbers of student interns sent to their factories, along with their teachers, who serve as de facto foremen and forewomen. In the summer of 2010, Foxconn had 150,000 interns, including more than 28,000 making Apple products at its Guanlan factory in Shenzhen. Generally, interns engage in basic production jobs that have no relationship to their field of study. Instead, the internships are simply enforced labor—students can leave, but doing so jeopardizes their ability to graduate. Interns receive basic entry-level wages but no benefits, making them cheaper than regular employees. Though not bound labor like parish apprentices in English textile mills, the students, who have become an increasingly important component of the Chinese factory labor force, are not exactly free workers hired through an open labor market, either. Rather, they are mobilized by state-company institutional arrangements that give them no real freedom of choice.66
Hiding in Plain Sight
The giant factory in China and Vietnam has not received the kind of notice it did in its earlier incarnations in England, the United States, the Soviet Union, and Eastern Europe. Considerable attention has been paid to the plight of migrant Chinese workers, particularly in film, but much less to the factories they work in.67 Part of the reason is the secretiveness of factory owners, who for the most part see only a downside in allowing their facilities to be visited or documented. In the nineteenth and twentieth centuries, companies saw their factories as good advertising, symbols of their position at the cutting edge of industry and a way to get their products better known among consumers. Soviet and Eastern European authorities viewed their giant factories as showcases for socialism, also appealing, in a different way, to a broad public. By contrast, owners of giant Chinese and Vietnamese manufacturing enterprises do not want anything to do with the public. For the most part, their customers are not end users but other companies. And as far as those companies go, by and large the less known about the manufacturing processes the better.
For one thing, companies like Apple and Adidas want to keep secret proprietary methods and details about products about to be introduced. For another, they fear criticism of the working conditions under which their products are made, including by international social-justice groups adept at circulating images and information about worker abuse. While ordinary tourists could visit River Rouge, and still can, the idea is unthinkable with Foxconn plants or most other giant factories in China. Scholars, journalists, and documentarians have great difficulty getting past factory gates, and when they do, they are closely guided by minders, not given full access. The leading media of their day were awash with images of English textile mills, Lowell, Homestead, the Stalingrad Tractorstroi, and Nowa Huta. By contrast, photographs of factories owned by Foxconn, Pegatron, and Yue Yuen are surprisingly uncommon, and pictures of what goes on inside them rarer still.68
Because the largest Asian factories do not serve as advertisements or symbols for the products made within them, there is no incentive to invest in distinctive or innovative architecture, as leading manufacturers did in the nineteenth and twentieth centuries. There is no Belper Round Mill or FIAT Lingotto in China. Instead, there are generic factory buildings, modern looking but utterly lacking ornamentation or distinguishing features, even the distinctive fenestration that once marked major manufacturing sites. Many Chinese plants look like they could be suburban office buildings. Bloomberg Businessweek described Foxconn City, with its multistory buildings faced in gray or white concrete, as “drab and utilitarian.” In recent decades, China has been the leading world center for hiring celebrity architects to build unusual, large-scale, modernist structures, but they are office buildings, concert halls, stadiums, museums, libraries, shopping malls, and hotels, not factories.69
Recently built factories in China and Vietnam are not held up as sources of national pride, as steel mills in Braddock, Pennsylvania, and Nowa Huta once had been. Unlike the showcase factory giants of the past, the new massive factories in China and Vietnam are largely foreign owned, run by foreign managers, making goods largely for consumption out of the country. Rather than symbolizing how advanced their host countries are, they serve as reminders of how much catching up they have to do to match countries like South Korea, Taiwan, and Japan in technology, design, and management.
Many leaders in the developing world, including China, do not see having locally owned, large-scale manufacturing as their real target nor as a badge of entry to the club of First World nations. They are acutely aware that rich countries like the United States have been shedding mass-production manufacturing, concentrating instead on higher-end production of specialized goods, design, technological innovation, marketing, services, and finance. Basic manufacturing, for better or worse, seems like yesterday in much of the advanced world, especially the United States, an attitude picked up in less developed countries. Modernity does not mean the assembly line for Chinese policy makers and elites. Rather, they see mass manufacturing as a stage to go through and leave behind in achieving modernity. Chinese officials still see a role for mass production in raising living standards; they hope to hold on to lower-end, lower-paid manufacturing by moving it into poorer interior regions. But in wealthier parts of the country, including pioneer special economic zones, the push is to move beyond basic assembly-line production. In Shenzhen, the epicenter of the explosion of Chinese industrial giantism, older factories are being knocked down to build upscale residential and commercial buildings.70
Seen more as a necessity than a triumph, giant Chinese and Vietnamese factories are devoid of the heroic overtones associated with earlier large-scale industrial projects or with modern Chinese infrastructure projects like the Three Gorges Dam or the skyscrapers, bridges, and high-speed rail lines that have remade the landscape. In part, this is an issue of gender; modern apparel, footwear, and electronic plants are heavily staffed by women, unlike steel and automobile factories and big construction sites, where men have dominated the workforce, and largely still do. Heavily female industries sometimes have been associated with utopian dreams, like the early New England textile mills, but Promethean daring generally has been associated with brawny male workers, workers resembling the common portrayal of Prometheus himself.71
The nature of the products that pour out of Asian factory giants contributes to their banality. The twenty-first-century factories with the most employees typically churn out small things, like coffeepots, sneakers, or smartphones, which could fit into a small box or the palm of a hand, not the large, awe-inspiring cannons, beams, machines, vehicles, and aircraft produced by the largest nineteenth- and twentieth-century factories. Billions of people worldwide may want iPhones or Nike sneakers and see them as symbols of modernity, but these accessories lack the world-historic aura of the products that came out of the giant steel mills and auto plants of yore.
Rather than representing an enlargement of the human spirit, modern factory giants often seem to symbolize its diminishment. Images of Chinese factories typically do not celebrate machinery or man’s mastery of nature but instead document bland, boring structures or portray repetitiveness—size as endless replication.72 What makes Burtynsky’s photographs of Chinese factories so extraordinary is not the extension of human power through the mastery of materials and machines or the beauty of the machinery itself, themes of so many earlier factory portrayals, but the shrunken scale of people, regimented in lines and grids within the vast confines of factory sheds. Burtynsky, like Andreas Gursky, also known for his spectacular photographs of factories and public spaces in Vietnam and China, generally takes large-format pictures from a distance, showing humans in almost abstract patterns, rarely focusing on any individual, the way earlier factory photographers like Margaret Bourke-White and Walker Evans did, at least occasionally.73
Foxconn, Yue Yuen, and the other modern giants of Asian manufacturing represent a culmination of the history of industrial giantism. They build on the past, incorporating all the lessons about assembling and coordinating masses of workers, the detailed division of labor, externally powered equipment, mechanical transfer of components and pacing of production, economies of scale, and shaping every aspect of workers’ lives. All of the past lives in the present. But the future does not, except in the most limited, technical way. The giant factory no longer represents a vision of a new and different world a-coming, of a utopian future or a new kind of nightmare existence. Modernity, Foxconn-style, may be associated with higher living standards and innovative technology but not with a new phase of human history, as giant factories once were, whether it be the coming of a new type of class society in England and the United States or a new type of classless society in the Soviet Union and Poland. The future has already arrived, and we seem to be stuck with it.