For three years now, the manufacturer of the iPhone has pledged to improve conditions in Chinese supplier factories. What’s been done? Not enough, as Hannes Koch found when he paid a personal visit to the factories themselves in September 2013
Pui Kwan Liang lets down the blind. It blocks out the sun, the dusty street on the periphery of the Chinese industrial city of Shenzen, as well as curious looks from passersby. Twenty-seven-year-old Liang needs to exercise caution due to the nature of her work. The labour activist from Hong Kong travels regularly to China to offer support to employees there.
She’s reserved a separate room in a restaurant. There’s rice, spicy vegetables and chicken on the revolving glass centre of the large round table. Whenever waiting staff open the doors to loudly announce the arrival of yet more bowls of food, the conversation falls silent. The information being exchanged here must stay within these four walls.
Liang is a petite woman with black hair; she’s wearing a light blue T-shirt emblazoned with the Beatles’ song title “We All Live in A Yellow Submarine”. But she is tense. Using her smartphone, she records the worker’s account. The 28-year-old man has been working at the iPhone factory just around the corner for one-and-a-half years. He originally came from the poor, crowded province of Hunan in southwest China. Like many Chinese, the nails of his little finger and thumb are long and well-groomed. But his skin is scarred, the hand stunted and crooked. He can barely bend his fingers at all. “The accident happened when I was working on the iPhone assembly line,” he says. He came away with a catalogue of complex fractures.
Now the iPhone employee is locked in a dispute with his employer over money. According to the law, he says, he should initially be on full pay following his accident – something that’s also policy in Germany. “But I’m actually only getting a third of it,” he says. He also claims the company is trying, with the help of doctors, “to get the injury and disability categorized as less severe so that they have to pay less," adds Liang. In he case of this particular worker, the outcome of the dispute will determine whether or not he is able to continue to provide for his child, who lives with his parents back in his home village.
The man is one of millions of people working in China producing iPhones, iPads and laptops for Apple, some of them most certainly destined for customers in San Francisco, Paris and Berlin. Public interest in factory conditions was first aroused in 2010.
This was the year when 13 workers took their lives by jumping from the rooftops of those very factories. The US-based NGO China Labor Watch says a total 18 employees of Foxconn, the largest supplier to Apple, are now known to have committed suicide.
Seven days working on the assembly line, frequent 80-hour working weeks, barely any holidays or days off, miserable wages of less than 1 Euro an hour, contact with toxic substances without adequate protective clothing, maltreatment at the hands of foremen, overcrowded residential quarters – this is how employees described their working lives in 2010. Apple and Foxconn then promised to improve conditions – by 1 July 2013.
So what’s happened? Has Apple kept its promise? “No”, says Liang. “What Apple has done is not enough.”
The activist is not alone in her opinion. Professor Huilin Lu is also critical of the iPhone concern. The 44-year-old sociologist works at Beijing University, an institution that enjoys the same prestige as Harvard in the US. Lu’s students regularly take up holiday jobs in the supplier factories and write seminar papers on their experiences. As a result, the academic is one of the few people to have a thorough insight into the company’s practices. He sits on his bulky black office sofa and says: “Apple has not fulfilled its promise.”
“The wages are only enough to cover bare essentials,” says Luo.
What should we make of this? Did Apple only issue its promise to reassure its customers in wealthy countries where its reputation could be damaged? Is the company telling lies?
The factory is to the right as you come out of the restaurant. There are thousands of bicycles parked outside the main gate, private security personnel in green uniforms stand guard, behind them rows of modern factory buildings as far as the eye can see. Exit the restaurant to the left, and after a few blocks you’ll come to a residential block for factory staff who find the workers’ quarters on the site too noisy. Narrow streets, cramped stairways, Liang has pre-announced the visit. On the second floor, Qingqing Luo* opens the door to her apartment, which consists of nothing but a room about 12 square metres in size.
Her husband Qian* struggles to his feet and sits on the side of the bed. He is weak, waiting impatiently to recuperate. There’s a low table placed against one wall with a laptop on it; next to that, two trolley bags piled on top of each other serve as a shelf. There are no chairs. The visitors sit on pink plastic stools that look a bit like upturned buckets. Then there’s a tiny kitchen with a double gas burner and a small bathroom. That’s all the iPhone worker and his wife can afford.
Qian Luo, 32, reports how, whilst working in the factory setting up and maintaining the production lines for Apple devices, one toe on his right foot was cut off with an angle grinder. He also blames the company for this: “They didn’t give us any protective shoes.”
Liang records the conversation again. She is collecting material for a new study for imminent publication by her organization Sacom (Students and Scholars Against Corporate Misbehaviour). She translates from the English into Chinese, and back into English. The injured worker reports that while he’s written off sick, he’s receiving 1,200 Yuan in social security payments, that’s 150 Euro a month. “It’s only enough to cover the absolute bare essentials,” he says, and Liang translates. Before his accident, he was earning around 3,500 Yuan, or around 340 Euro. “In a big city like Shenzhen with its relatively high cost of living, that’s enough for one person to live reasonably well,” says Liang, “but for two people it’s a bit tight.”
And how long did Luo have to work for this wage? His response: “Twelve hours a day, six days a week.” So 72 hours a week.
The long working day was one of the issues Apple promised to address by 1 July 2013. Chinese labour laws clearly state that weekly working hours must not exceed 49. But as Qian Luo and many other iPhone workers in China confirm, in August and September 2013 their working hours were often far in excess of this legal maximum limit.
Is this an unintentional oversight? “No,” says Professor Lu in his Beijing office: “Apple is responsible for the working conditions.” He goes on to say that the company knowingly determines the pace of the manufacturing process, which in turn leads to these unlawful working hours. New products are continually being put on the market – the iPhone 5, the 5s, and now the 5c, for example. Within a short period of a time dozens of millions of devices then have to be manufactured and exported all over the world. Under this kind of pressure, Chinese factories have little choice but to work around the clock, on Saturdays and often on Sundays too, says Lu.
Apple recently placed two-page adverts in German newspapers. They show, for example, two teenagers wearing white headphones listening intently to music on an Apple device. The copy reads that the company works so long on its products “until every idea enhances every life it comes into contact with.” An almost superhuman claim. But does it at least partly apply to those people who work for Apple?
The company now regularly sends inspectors out into its factories. In addition, managers at the California HQ commissioned the Fair Labor Association FLA, a US organization for “ethical working conditions”, to improve the situation. In May 2013, the FLA published a report on Foxconn. This is the Taiwan-based main supplier to Apple, the operators of the Chinese factories where some 1.3 million people work. The people who committed suicide had been working for Foxconn.
The FLA report claims that most of the problems have now been addressed. In pages and pages of tables, the inspectors document the initial shortcomings, their procedure and the outcome. One example: At the Foxconn plant in Chengdu in central China, some of the fire alarm buttons were broken and not marked with Chinese characters. The FLA inspectors insisted that these be repaired and properly labelled. In their report, the tables that are open to public view were then marked with the word “completed”.
One of the issues still left open in the report continues to be the long working hours. In its May 2013 report, the FLA criticizes the fact that many Foxconn workers are on duty for much longer than 49 hours a week. “That is in contravention of the law,” the report explicitly states. The labour rights organization China Labor Watch ascertained a similar situation in July 2013 at the company Pegatron, which operates Chinese factories manufacturing Apple products including the new iPhone 5s and 5c – factories where workers are routinely working as much as 69 hours a week.
Ask Apple directly, and the company insists it is doing everything it can to improve conditions and adhere to the law. In a statement issued in late July 2013, it pledged to “immediately investigate” the new accusations. As for a comprehensive report on whether the company has fulfilled its promises by 1 July 2013 as pledged, this has not been forthcoming.
In any case, Pegatron refuses to give any interviews whatsoever. And despite chasing responses promised by Foxconn, these had not been supplied before this paper went to press.
In any case, Liang the activist doesn’t have faith in the reports by Apple and the FLA. She pursued a cultural studies course in Hong Kong and wanted to do “something meaningful” after graduation. For her, this is about helping the workers “to raise their voices and represent their own interests themselves”. But, she adds, Apple and Foxconn continue to treat their employees like “replaceable tools”.
But does she not concede that the companies are at least trying to improve the situation? “I don’t know for sure,” answers Liang, “after all the workers were not able to make an active contribution to the reports.” Perhaps Apple is claiming progress that is actually not happening at all.
This is why Liang prefers to talk to the employees herself. She and her colleagues go to the factories and approach the staff. One place where it’s easy to do this is in an alleyway of shops opposite the Foxconn plant in Taiyuan, a city 400 kilometres southwest of Beijing.
It’s 7pm, and already dark, the night shift is about to begin. The workers – most of them younger than 25 – stream towards the factory between the two-storey buildings. There are charcoal barbecues mounted on the backs of electric scooters parked on the side of the road. Chicken and vegetable kebabs are popular provisions for the long nocturnal hours. There are hairdressers and Internet cafés close by, where workers can take a break on the way home in the morning. On one corner there’s a huge pile of coal. The air is dusty, there’s a permanent cloud of smog hanging over the city; Taiyuan is a coalmining region.
But activists like Liang also get to hear information that doesn’t actually fit into the general scheme. Zhi Wang*, 25, bright eyes, light brown imitation leather jacket, blue jeans, passes cigarettes around as he explains what he does at Foxconn – and that is to play software onto iPhone 4s. It’s been pretty quiet for a while, he says, no overtime, no more than 10 hours’ work a day. This could be due to the fact that demand for the older smartphone models is receding. Wang doesn’t appear to be stressed out. He stays here for some time chatting.
“What’s it like working for Foxconn?” Ask this question in the alley of shops opposite the plant and you’ll frequently hear the same response: “It’s OK.” Yes, for sure, there are complaints.
Sometimes the foremen yell too much, the wages don’t always go far enough, the odd worker says she sometimes wishes she had an extra day off here and there to escape the routine. But all in all, people here don’t appear to be desperate, or struggling to contain their anger.
The responses are similar by the entrance to the Pegatron plant in Shanghai. This is where many of the new iPhones 5s and 5c are made. Five minutes away from the main gates of the factory site where some 70,000 people work, there’s a market with snack vendors similar to the scene in Taiyuan.
It’s early in the morning but already 25 degrees, the sun is shining. Wei Liu*, 20, and his colleagues have just come off the night shift and are sitting down to breakfast.
Liu is training to be a mechanic at the local vocational college. He’s currently on a work placement with Pegatron; for three months now he’s been on the production line fitting the vibration mechanism into the 5s phones. His ears are pierced with diamante, there’s a pair of disposable chopsticks poking out of the pocket of his salmon-pink Pegatron workshirt.
“The iPhone is a status symbol,” he says. “Everyone wants one. It’s very expensive for me.” He says the latest model would cost him a month’s wages. Up to now, he’s done without.
Nevertheless: Liu feels he receives a fair wage. He earns 4,000 Yuan per month, around 500 Euros, for a 70-hour week. For this young man, it’s enough. And not only that: Last year he even managed to save money doing student jobs. He sends the money to his parents – for them, and for his own future.
Liu says: “I’ve got it better than my parents”.
Liu looks tired. “The work isn’t strenuous,” he says, in spite of this. He explains: In comparison to that of his parents, who are farmers living a day’s drive away from Taiyuan. Sowing seeds three times a year, working on the fields, all the time, not just 11 or 12 hours a day like he does, but all the time. “And even then they don’t have a secure income because of the weather,” says Liu. Yes, he is tired. But he adds, “I’ve got it better than my parents.” As far as he’s concerned, working for Apple represents personal progress.
Although essentially a critic of Apple, Professor Lu also sees progress. He can even demonstrate it in figures. Minimum wage in Shenzhen in 1992: 245 Yuan. Today: 1,600 Yuan. Almost seven times more within 20 years. But he explains why conditions must continue to see an improvement in the long-term. He says this is because the supply of industrial workers in China is gradually running out. Whereas the demand in mobile phone plants is growing, millions of new personnel are required. Major relocation to Laos or Vietnam isn’t an option for the companies. There are far too few people there, and no infrastructure to operate hi-tech factories. The managers of Foxconn and Pegatron are only too aware of all this, he says.
So progress has been made. But also: “Serious exploitation,” says Lu, “because the working wage in the Apple production chain is only enough to support one person. Employees can’t finance a family of their own on this level of pay.” Although people stand at the belts 12 hours a day, although all they do is work, eat, sleep and work again, their wage doesn’t cover the worker’s own reproduction costs. It could be said that the factory is eating their children. Because it doesn’t make it possible for them to have any of their own.
Liang, the labour activist, is on her way home. Looking out of the window of the bus, all you can see for hours and hours are new residential blocks for hundreds of thousands of people, shopping malls, factories. Progress? “In the old days, when China still believed in communism, the working classes were often treated better,” she says, the modern young woman from Hong Kong. “At least they were able to feed their families then.”
* Names have been changed
Profits on iPhones
The costs:
According to a US study published in 2011, work carried out in Chinese supply factories costs just 1.8 percent of the retail price of an iPhone 4. That’s almost 9 Euros of the product’s end price of some 450 Euros. Foxconn managers say the production costs are 3 percent of the retail price: This would make it 13.50 Euros.
“In both cases it’s clear: Apple could easily double or treble the working wage in supplier plants, or more specifically oblige suppliers to do this and pay them higher prices accordingly,” says Cornelia Heydenreich from the organisation Germanwatch.
The profits:
This would have a decisive effect on the retail price. Either the iPhone would become slightly more expensive, or Apple’s profits would be slightly lower – but still exorbitant. The Apple and Samsung trial revealed that in 2011 and 2012, iPhones generated a gross profit of some 50 percent of the retail price. Germanwatch employee Heydenreich says: “In view of such profit margins, there is an ethical responsibility to ensure staff at supplier companies are being paid a fair living wage.”