Foxconn Henan encountered labor shortage: government subsidy of hundreds of millions recruited

After Apple released the iPhone 5 on September 12, it was ordered by more than 2 million consumers within a day and was optimistic about the best-selling mobile phone in history.

From August, Foxconn’s production bases in China have received Apple’s iPhone 5 production mission. Among them, Foxconn Zhengzhou has a production capacity of 200,000 iPhones per day. In order to ensure maximum production capacity, Foxconn Zhengzhou Company needs to recruit 200,000 workers to ensure production capacity to complete orders, of which only need to recruit 50,000 people in September.

The governments of all levels in Henan Province have become the main force in fulfilling this recruitment task. This is one of the many preferential measures that Henan Province initially attracted Foxconn to settle in Zhengzhou.

However, as a traditional labor-exporting province, Henan has not been able to recruit workers for Foxconn on schedule, despite spending billions of dollars in financial subsidies.

The wave of east-west industrial transfer represented by Foxconn's investment in the central and western regions is creating a wave of investment promotion in the central and western regions. The increase in labor demand created by a large number of newly-built factories is triggering a wave of intensified "labour shortage."

100 million yuan in financial subsidies

Informed sources said that on August 4th the provincial governor's office held in Henan Province decided that the Henan provincial government would assist Foxconn recruit 200,000 workers. This task was assigned to 18 cities and counties in Henan Province. Counties and cities that do not fulfill their recruitment tasks will be criticized.

The relevant department of Zhumadian, one of the 18 cities in Henan Province, confirmed the news. The mission of the Zhumadian city government is to ensure that Foxconn recruits 10,000 workers before the end of the year. The Zhumadian city government once again divided the task into 9 districts and 1 district under the jurisdiction of the city. The county government allocates tasks to each township. On average, each township needs to recruit 20 or 30 workers to Foxconn.

In addition to dividing the recruitment tasks according to administrative levels, the government also reduced the recruitment tasks to a number of professional intermediary agencies. Once the local government has sent the recruited workers to the Foxconn factory in Zhengzhou, after Foxconn’s confirmation, Foxconn will use the standard of RMB 400 per person to bring the employment introduction fee to the Labor Bureau account. These expenses, in accordance with the Labor Bureau's interpretation, are used as subsidies for the recruitment of workers to work at Foxconn, advertising on TV stations, printing of color pages, and accommodation and transportation expenses incurred in the recruitment of local people.

It is understood that in order to increase the enthusiasm of migrant workers to Foxconn's work, the Henan provincial government will also give new workers a subsidy of 200 yuan per month per worker received by Foxconn. This subsidy will be paid until the end of this year. The expenses will be paid by the Department of Finance of Henan Province and issued by the Department of Personnel and Labor of Henan Province. According to a rough calculation by the reporter, if the 200,000 employees are employed by the end of the year, by the end of the year, the financial subsidies that Henan Province needs to pay may reach 100 million yuan.

The reason why they did not hesitate to use financial subsidies to help Foxconn recruit labor, Henan, in the eyes of Foxconn settled in Zhengzhou, so that more than 200 supporting enterprises in the upper and lower reaches also settled down in Henan, the formation of the demonstration effect of investment.

However, Zhang Guoxuan, director of Zhumadian Career Center, told the “China Business” reporter that the task was not completed successfully. Some counties had also tasked the villages and townships to complete the task. The same village committee also received the recruitment task from the township government. . The recruitment task assigned to Zhumadian in Henan Province was to hire 3200 people for Foxconn in August, but the Zhumadian only completed half.

The recruitment task in Shangqiu, Henan is also not optimistic. The Ningling County under the jurisdiction of Shangqiu City issued a task of recruiting 700 people before the end of the year. Not long ago, the government of Ningling County met again and asked the labor department to complete the recruitment of 300 people by September 14. In fact, from August 10th to the present, Ningling County Labor Bureau has helped Foxconn recruit fewer than 100 people.

“We can’t recruit people, only the leadership criticizes.” Zhang Guoxuan said, “Although September is the most needed time, the number of workers recruited in some counties is still zero.”

Job War

In order to recruit workers, enterprises, labor agencies, and even the government launched a battle to rob the labor force.

In order to recruit workers, Zhumadian South Zhongtian Textile Group relaxed its recruitment age to 16 to 45 years old, and its educational level is not limited. Normal corporate recruitment will require 18 to 35 years of age, and at least junior high school or above. The Zhongtian in the South also provided good treatment, with a monthly minimum salary of 1,800 yuan, employment at home, social security payments, and signing formal labor contracts. However, the reality is that the South China Sky’s “utility gap is still large”.

Shenzhen Quanshun Human Resources Co., Ltd. uses its commitment to “guarantee the bottom” to increase the competitiveness of its own company in the battle for migrant workers. The minimum price for one month is not less than the amount of money, no matter whether it is live or not. The manager of the company, Yang, said that the salary treatment he introduced for migrant workers has been rising for the past few years. From 1300 yuan in 2009, it rose to RMB 2,400 yuan from RMB 2-3 per year.

Zhang Guoxuan, director of the Zhumadian City Labor Career Introduction Center, lamented that there are too many places to employ people now and recruitment is very difficult. “We ran every day in the villages of the county and asked everywhere in the village who had no migrant workers at home and specifically lobbied for employment youth to work for Foxconn.”

Ningling County, Shangqiu City, Henan Province is a major agricultural county. The export of labor services has always been the most important industry in this county. Ningling County had a total of 210,000 people migrant workers last year. So far this year, 180,000 people have gone out to work. This means that there are few remaining surplus laborers in Ningling County. However, the autumn corn will soon mature, which will attract about 230,000 migrant workers to return home to collect corn. This is the last chance to recruit migrant workers within a year.

However, even if it is “deep into the countryside” to recruit workers, the effect is still not good. Ningling County, who is responsible for coordinating and assisting Foxconn’s recruitment of labor and employment bureau staff Wang Shijiang, stated that Ningling County’s emphasis on helping Foxconn recruiting has even surpassed some routine work, but now Foxconn is increasingly unable to recruit people in Ningling County. .

Wang Shijiang said that before Foxconn recruited, many people took the initiative to apply to the Labor Bureau, but those who are now willing to work at Foxconn are less likely to work. On the one hand, the competitiveness of Foxconn's salary treatment is not higher than that of a large number of electrical and electronic factories along the coast. On the other hand, Foxconn uses the order processing model. There is no order, and employees will not get the final salary, but also deduct a certain cost of living. This is also the reason why people who voluntarily go to work at Foxconn have weakened their enthusiasm.

Zhang Guoxuan said: "The job responsibilities of the Labor Bureau are exactly the same as they were before. They used to find ways to promote the employment of migrant workers, but now they are busy for companies that cannot recruit people."

"Labor shortage" or will continue to upgrade

With the expansion of Foxconn and other labor-intensive enterprises, West China, the speed of China's east-west industry transfer has accelerated in recent years. This industrial transfer has given Henan a lot of benefits. In the first eight months of this year, Henan actually used foreign funds outside the province to account for a quarter of the province's urban fixed asset investment. In July and August, Henan actually spent 42.2 billion yuan of funds outside the province, an increase of 35% over the same period of last year.

Zhang Guoxuan's analysis of the causes of the “labor shortage” is that investment is now being introduced throughout the country. The government gives the company many preferential policies, and the factory buildings are built, let alone the land. As long as people are recruited, they can produce immediately. This has led to a sudden increase in the demand for labor in enterprises that have settled in Henan.

Although there is no accurate and comprehensive data to show that investment contributes to the contribution of jobs, but from a relatively micro perspective, we can still see the huge absorption of labor by industrial transfer. Taking Wulu County in Henan Province as an example, the county has a surplus labor force of 170,000, of which half of them work outside the province. However, when several frozen food companies settled in Wushu, they will bring more than 60,000 jobs to the local area in the short term. It is obviously more difficult to recall migrant workers who have already worked in other provinces in the short term.

On the one hand, along with the intensification of labor shortages in coastal areas in recent years, the treatment has also been improved. On the other hand, whether migrant workers are skilled in processing frozen foods is also a problem.

Therefore, in the view of some labor intermediaries, the increase in the number of labor positions created by investment in factories is merely an aspect of “employment shortage”. The deviations in the employment needs of enterprises and the selection of enterprises by migrant workers also amplify the “labor shortage”. "phenomenon.

The transfer of industries obviously has greatly increased the selection space for migrant workers. Many migrant workers are more willing to choose to work at home. However, whether migrant workers can do the work at their doorsteps also requires a process.

Statistics show that in 2010, the total employment of rural laborers in Henan Province was 23.63 million, of which 11.42 million were transferred within the province, accounting for about half. Before 2010, nearly 70% of rural laborers in Henan Province were employed in the Pearl River Delta, the Yangtze River Delta, and the Bohai Rim.

Since 2008, the proportion of laborers in Henan province has increased year by year. This trend has become more apparent in the past two years. In 2011, the number of people employed in the province's labor service province increased by 1.26 million compared with 2010, of which about 240,000 were transferred from outside the province to the province. The data shows that after the Spring Festival in 2012, 1.8 million people are reluctant to continue to work outside Henan Province.

“Companies usually like to work hard, skilled workers with skilled training, and able to work long hours at the factory. But young people today are very different from the past, and their ideas are more active. Young migrant workers in the 80s and 90s I am more willing to choose my own work style and lifestyle, and there is also a wide range of choices for the job position. Which is low wages or unsatisfactory work, I would like to jump to another company at any time.” Yang Quan, Manager of Shenzhen Quanshun Human Resources Company, said, “Now There is fierce competition and companies would rather earn less but also give employees some benefits. If they do not do so, the company will close down."

At the same time, older migrant workers are more willing to do manual work at construction sites. They are also groups of migrant workers who do not want to be bound by factories. "This is also a fairly large group," said Yang.

Liu Er-fu, deputy dean of the School of Labor and Human Resources at Renmin University of China, believes that since 2005, the "labor shortage" has begun to attract people's attention on a large scale, but the grim situation of this "labor shortage" has not slowed but has become increasingly serious. "This comes from the family planning policy. The new labor force has been reduced, but the demand for social workers has not changed and the labor supply demand has become more and more inconsistent."

According to a set of data provided by Liu Erxuan to reporters, since the 1990s, the number of newborn babies in China has declined year by year. The number of births of newborn babies in 1990 was 25 million. By 2009, it had dropped to 15.8 million. In 19 years, it had dropped by 10 million. The baby born in 1990 is now 22 years old. It is the right-worn workforce at 22 years old.

The reporter learned from Henan Provincial Family Planning Commission that the total number of elderly people aged over 60 reached 15.92 million in Henan Province, accounting for 15.2% of the total population in Henan, which is 0.4% higher than the national average.

"This just shows that the lack of labor in the future will be a long-term existence. The only way for companies to solve employment difficulties is to increase treatment. If they cannot improve treatment, it means that the company is less competitive and the industry needs to upgrade, otherwise it will only be able to The industry moved to a more backward place to produce," said Liu Ye.

Data link

Chuanyu labor supply approaches "ceiling"

Over the years, labor exports in Henan and Sichuan provinces have each accounted for 1/10 of the national scale.

In Henan, the largest exporter of labor services, the total number of rural labor transfer workers reached 24.65 million in 2011. However, according to sources from Henan Renshe Office, from 2013 to 2014, the total supply of labor in Henan province will soon “peak”. At that time, the total number of surplus laborers in the province will shift to a peak of about 25 million.

From the data of recent years, the growth of the total labor supply in Henan Province has obviously begun to decrease. In 2007, Henan added more than 2 million laborers. By 2011, it was only 1 million. This representative precursor to the saturation of the supply of labor and even the beginning of decline has begun to appear in some traditional labor export counties and cities.

Sichuan, another major labor export province, faces the same situation. Wu Xiangyu, director of the Sichuan Office of Agriculture and Labor Affairs, said: “The current scale of rural labor transfer in Sichuan has reached about 23 million people, and we estimate that the province’s labor export limit is between 24 million and 25 million, and the growth space is very limited. Now it is new every year. Increasing the size of the rural labor force is only around 500,000."

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