The Half-year Period of Workers Returning to Work in 2020: Changes in Labour Conditions of Garment Industry in the Pearl River Delta Region, China

Researchers:Worker Empowerment (http://www.workerempowerment.org), TSE Fuk-Ying (University of Leicester)
Editor: May Tam

1.Background

In 2020, the COVID-19 pandemic had brought changes to the production, supply and sales activities of the global production chain, with workers’ livelihood badly hit by decrease in production orders and work suspension.  This came in a period of recent years when China, as the world’s major exporter of its manufactured products, has undergone draining of production orders away from home to overseas for certain industries like the garment one.  At the same time, China has also started to put weight on developing its domestic market.  All the above situations may, as projected, impose long term influence on the structure of China’s production value chain as well as employment of workers.

In such contexts, the labour organisation, Worker Empowerment, wanted to understand the labour conditions of various industries upon production resumed after the COVID-19 pandemic outbreak.  Worker Empowerment conducted an in-depth research on the garment industry in particular to examine the workers’ employment situation changes after the COVID-19 pandemic had somewhat been under control.  The research also explored the extent to which the pandemic-caused situations such as work suspension, unemployment and change of occupation among workers could be reverted.   

The research focused on the labour conditions during the half-year period (from Feb to Sept 2020) when workers returned to work in factories after the pandemic outbreak.  However due to limits of time and resources, the research did not explore how the garment industry would be affected by the pandemic in the long run.  The interviews told that there has already been moving of garment production lines out of China before the emergence of the pandemic, which has led to closing down of factories or massive diminution of production scale.  The pandemic is only to aggravate the existing operation difficulties, but has yet to bring a complete halt of production in the industry.  How the outlook of the garment industry is affected by the pandemic is beyond exploration of this study.    

2.Research themes

The research aimed to explore in-depth the changes in labour conditions, work quantity and quality during the period of workers returning to work under the pandemic at seven garment factories located in four cities of the Pearl River Delta region.  As most workers in the garment industry are female, the research also investigated the difficulties these women workers faced, their response to the challenges and expectations about their employment prospect.

The factories involved are mostly run by foreign invested enterprises focusing on manufacture and export of multinational brand garment upon serving overseas production orders.  The products made include knitwear, garment accessories, underwear and footwear.  Detailed research methods are described in the post-script note.    


Factory recrutiment notice, 2020

3.Findings

I. Impact of the pandemic on production and operation of the garment enterprises:

  • Resumption of production postponed: The pandemic broke out in China before Chinese New Year when migrant workers in cities had returned to their home villages for holiday.  In view of the pandemic situation, China’s State Council announced delay of the post-new year production resumption date to 3 February 2020.  The major enterprises involved in this research had postponed such a date to mid-February through the end of March. 
  • Orders and amount of production substantially reduced: There were orders of certain high-end brand products totally cancelled while demand for products of other brands decreased significantly.  However, the shortage of production orders seemed to have gradually moderated after the middle of the year.
  • Certain factories stood up to or tackling the adversity with new strategies: An interviewee in Dongguan mentioned that the handbag factory which s/he was working for did not see its production amount decreased but on the contrary, the workers were even busier.  This might be due to focusing on domestic market or producing local brand products.  Some other factories created new businesses during the pandemic period.  An example is Factory B in Shenzhen which produced new products of medical supplies such as face masks and eye masks, as well as keyboards.  It also promoted e-sales to boast the selling of its local brand garment in the domestic market.
  • Some factories closed down whereas other ones revived by developing e-sales: Lockdown led to shop closure which hindered sales and thus some foreign brand enterprises closed down, whereas other brands grabbed the opportunities of rising demand for low-priced clothes and home wear which was triggered by work-from-home measures.  These brands also developed e-sales that resulted in sales increase.

II. Impact of the pandemic on workers’ workload and manpower scale:

  • Workload and work hours reduced: Reduction of foreign trade orders led to significant decrease in workload and work hours.  Numerous interviewees said that overtime work was greatly reduced after they returned to work while some factories took two-day offs (on Saturday and Sunday) at weekend, and some factories suspended work in the daytime.  Overtime work resumed gradually only until the period from May to September, but the reason for such resumption might not be receiving production orders again from original clients.  The headquarters Factory D in Zhongshan is an example.  In order to maintain the production amount of the headquarters factory, orders from its branch factories in South-east Asia were transferred to the headquarters factory so as to ensure that workers at the headquarters got enough work to do.

However, two types of workers were exempted from the pandemic’s influence that their workload on the other hand increased substantially.  The first type are non-production labours such as workers for cleaning, security, despatch, warehouse, quality control and etc.  Some of them became even busier because draining away of these workers was not followed by replenishment of manpower.  Moreover, big increase in disinfection work put cleaning workers in heavy fatigue.  Another type of workers were those engaged in domestic sales or downstream processing of products.  Their overtime work hours did not shrink, while some even were busy enough to enjoy only one day of holiday for the National Day celebration.

  • Scale of manpower shrunk: Some factories cut the whole machine shop(s), or merged several of them, and thus led to layoffs.  There were managerial staff sacked and women workers aged 50 or above or having reached retirement age did not get their contracts renewed.  Some workers resigned on their own accord because the piece rate and overtime work wage were lowered following reduction of production amount after their returning to work.  However, some of these resigning workers were forced to quit their jobs.  For example, there was(were) worker(s) resigned after being re-deployed to other lower-paid positions  following the shrinking of machine shops. 

Yet layoffs or dismissal of workers was not in massive scale, whereas more workers quit their jobs due to various reasons, such as traffic hindrance or undertaking of family duties.  There are difficulties in tracing these workers in the research and thus the exact unemployment situation is hard to evaluate.

 

III. Impact of the pandemic on wages:

  • Wages lowered: Among the 26 interviewees who mentioned their wage amount, about 60% of them received approximately RMB3000 to 5000 per month before the pandemic.  An overwhelming majority of those workers from factories engaging in foreign trade reported wage reduction during the several months after the pandemic outbreak.
  • Reasons for wage reduction varied: (1) Fewer production orders led to wage decrease when manufacturing workers were paid on piece rate; (2) Piece rate-based wage usually can only be rewarded when a worker manages to fulfil a minimum amount of production; otherwise, the worker can only obtain the basic wage or time-based wage which is much lower than the piece-rate wage.  Owing to inadequate production amount after the pandemic outbreak, workers from those several factories involved in this research could earn only the basic wage during the several months after returning to work; and together with the loss of performance bonus, their income had dropped by at least a half.  (3) Some factories suspended the usual raise of wage and production unit price while some even lowered the production unit price.  (4) There were staff being re-deployed to positions with lower wage after machine shops being cut or merged.  (5) There were non-production staff working longer hours without pay rise after shrinking of manpower, which implied wage decrease for workers. 
  • Wage payment delayed: Factory A in Dongguan, as an example, had repeatedly delayed the issuance of wage payment, which even led to strike.

IV. Workers’ response to the impact brought by the pandemic:

  • Extra income sought: Some workers sought to increase income by doing part-time work apart from their main job, so as to address income instability caused by less overtime work or change of job.  The part-time work included factory jobs or home-based manual jobs.  There were workers even setting up WeChat groups to exchange part-time job information. 
  • Change of job or occupation: Those workers, who were affected by the pandemic went jobless upon layoffs or quitting the existing job due to wage decrease, responded by either seeking new jobs or change of occupations.  For instance, a Shenzhen garment factory foreman changed job to be an online-booked driver after being laid off.  (More details of the pandemic’s impact on female workers and their response are outlined in Part V below.)

V. Impact of the pandemic on female workers and their response:

Most garment workers are female.  Among the workers being interviewed in the research, two-third of them are females while one-third males (more details in the post-script note). Female workers not only experienced the labour situation stated above, but they also encountered specific challenges relating to their family and economic duties.  This study researched into the situations the female workers were faced with and how they tackled them, as summarised in the following table.  Generally speaking, younger women workers aged 40 or below suffered heavier blows from the pandemic in terms of these two types of duties.

                

Younger female workers
(aged 30-40)

Older female workers
(aged 40 or above)

Duties to take care of family members

(Family duties)

Situations faced and response:

  • Some of them accepted less favourable working conditions in exchange for availability to take care of children: Most of their children are left-behind ones (children who live in their home villages with parents leaving for cities to work) studying in primary or secondary school.  They are taken care by grandparents or other relatives.  These women workers have been constantly staying outside of family and thus the pandemic did not influence much on their existing family role and caring duties.  However, for those living with their families in the cities where they work, they had to accept less favourable working conditions in exchange of availability to take care of their children.  For instance, a female worker accepted an unfavourable wage in order to be allowed to go home at noon for two hours daily to cook for her child(ren).

Situations faced and response:

  • No big changes in family role, with relatively less responsibilities: Most of their children are grown-ups requiring less attention, and thus they shoulder less family responsibilities.  The long period of having left family for work also explains why their family role has undergone little change.

 

 

 

 

 

Financial support to the family

(Economic duties)

Situations face:

  • Already shouldering greater economic burden which was further aggravated by the pandemic::Wage income for these workers is mainly to pay for livelihood of their own and their parents, as well as children’s school fees.  The pandemic led to fewer production orders and other changes which had depleted their income, thus heightening their economic burden.
  • Fulfilling family duties leading to wage decrease: Some of these workers delayed the date of returning to work after Chinese New Year because of the need to take care of small children and this in turn affected the wage income.

 

Response:

  • Taking part-time jobs to earn extra income
    (Details in Part IV)
  • Seeking new jobs after being laid off, or changing jobs because of wage decrease resulting from the pandemic’s impact.
  • Certain individual(s) seeking loan(s) for urgent needs: There was a woman worker took 5-month no pay leave after Chinese New Year to take care of children and thus no income earned during the period while her husband’s wage income was also badly affected by the pandemic, eventually leading to a substantial reduction in family income.  They thus paid children’s school fees through loan(s).

 

Situations face:

  • Originally lesser economic burden which was enhanced by the pandemic: Wage income of these workers is mainly for reducing their grown-up offspring’s economic pressure, such as financing the cost of the children’s marriage and housing.  As the pandemic led to a lower wage, the original lesser economic burden got enhanced.
  • More prone to suffer from layoffs: This is due to their old age.  For example, there was/were factory(ies) experienced hardship caused by the pandemic and then cut manpower by denying contract renewal for those females workers aged 50 or having reached retirement age.
  • Less favourable in seeking new jobs after being laid off: There was(were) big factory(ies) rejected job seekers who were aged 47 or above, disfavouring their physical deficiency hindering work effectiveness.  However on the other hand, there was /were small factory(ies) welcomed older women workers with proficient skills.  Yet the labour conditions there were informal - they did not proactively purchase social insurance for these older workers and neither allow them to enjoy leave entitled by regulations.

 

Response:

  • Taking part-time jobs to earn extra income
    (Details in Part IV)
  • Accepting less favourable working conditions: :Although these workers were not welcomed by big factories upon seeking jobs after layoffs, they could switch jobs to small factories if they were willing to accept less favourable working conditions.
  • Enjoying more choices and freedom in deciding whether to work and the mode of work: With less family bondage upon children having grown to be adults, these workers face relatively less economic pressure.  Even if they get sacked, they enjoy more choices on whether to work and the mode of work.

 

VI. Workers’ expectation about their employment prospect:

Dim prospect anticipated upon downscaling of the industry already in place before the pandemic: Those factories serving foreign trade orders have already undergone downscaling caused by decrease in orders or have move business out to South-east Asia prior to the pandemic outbreak.  Together with the blows brought by the pandemic, workers see their employment prospect bleak in the future.

 

Summary and conclusions

The research findings can be summarised as below, which briefly outlines the changes in the garment industry and its labour conditions experienced by workers (comprising mainly females) from four cities of the Pearl River Delta Region during the first half-year period of production resumed after the COVID-19 pandemic outbreak.  The findings also show how the workers responded to such changes as well as their expectation about the future prospect.  

   I. Those factories focusing on foreign trade have already undergone downscaling caused by a gradual move of their business to overseas even before the pandemic.  The pandemic is only to aggravate their operation difficulties.  Their response to tackle the difficulties included cutting manpower and management cost, or launching new businesses.  However for those factories living on domestic market sales or local brand products were less affected by the pandemic, with some of them even experiencing growth in adversity.

II. Under the pandemic, there were layoffs and dismissal of workers but not in a massive scale.  More quitting of jobs were workers resigning on their own accord due to various reasons.  Yet these workers were difficult to trace in the research, making it difficult to evaluate the exact unemployment situation.  In another aspect, the pandemic led to fewer production orders and less business, which in turn shrank workers’ workload and wages.

III. The majority of workers in the garment industry are female who undertake the caring and economic duties for their families.  The pandemic brought forth layoffs and wage reduction, which had imposed greater economic pressure on younger women workers than the older ones because children of the former were still very young.  Older female workers were the priority group targeted for layoffs.  However, the caring and economic duties for family shouldered by these two types of female workers were varied, so their response to tackle the challenges were different as well.

IV. Workers were generally not optimistic towards the garment industry’s future prospect because downscaling of the industry has already emerged with production lines being moved out to overseas before the pandemic outbreak.  The pandemic attack only worsened workers’ job instability.

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Note: Research methods

The research started with surveys conducted during September and November in 2020, half a year after China Government’s announcement on resumption of production.  The surveys targeted at four major locations of factories supplying multinational-brand garment products (including brands of H&M、UNIQLO、GAP、Arcadia) for export trade orders.  The four locations are cities of Shenzhen, Dongguan, Guangzhou and Zhongshan which are major garment production areas in the Pearl River Delta Region.  In each city, one or two garment factory(ies) were selected.  Researchers interviewed workers from these factories as well as workers from other enterprises nearby via face-to-face and WeChat dialogues, so as to understand the operation of these factories and the workers’ labour conditions.  There were altogether seven factories involved.  

These seven factories were mostly export-oriented and specialised in manufacturing multinational-brand garment products including knitwear, garment accessories, underwear and footwear while certain of them focused otherwise on research and development, product samples manufacturing and domestic market sales.   

The research explored mainly female workers’ situation but male workers were also interviewed to supplement information.  There were finally 69 workers successfully interviewed through face-to-face talks, with 47 females (68%) and 22 males (32%).  The interview contents were recorded in writing but not voice recording.

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