Factory worker Huang Xuefeng has seen his salary cut by 50%
Huang waits on a workbench for the welder to pass the next metal tray. There are only a handful of staff in the factory. Half of the building is in darkness.
The boss is stranded in Europe. They haven’t received new orders from their American customers for months.
This is a business that desperately tries to keep the lights on.
“So far we have not received any substantial mass production orders to keep the factory running and to be able to pay wages and to stay afloat,” Yuliya Yakubova told me. She was frank about the business she runs.
Speaking from Italy, he said: “The last [thing] What I really want to do is fire or let the employees go. “But she doesn’t have much left.
Lotus United is a business that is holding up. In an industrial park in Jiangsu, near the east coast of China, he makes the rails and shelves for the stores that some of you go to. Or at least he used to.
Two manufacturing plants, about 100 employees, have been reduced to just a handful of staff showing up every day.
Most of the machines are now turned off, cardboard boxes stacked, piles of rusty inventory on the floor.
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Huang Xuefeng is not very busy. Before we met, there were some sparks flying around a corner. The white glow of welding on a workbench.
Pay cuts
But the disastrous shutdown caused by the virus has reduced this company to a handful of workers, hiding in a corner.
Huang has had a 50% pay cut. You are now spending the equivalent of just over $ 200 (£ 160) a month.
“The money I earn now can only guarantee basic life,” he said. His family has been very affected because his wife also works in the factory.
They are a very small part of China’s great wave of migrant workers.
When I met him they had lunch together during a 25 minute break.
If the company goes down, they will lose their pay and their free lunch. There will be nothing to send back home with your daughter. “I came here in 2012. [She is being] raised at home since I can’t afford it. “
Retail accessories maker Lotus United has been hit hard by the coronavirus pandemic
Private companies like Lotus create most of the new jobs in China. But they are particularly vulnerable in this crisis.
In recent years, the government and the Communist Party have focused more on consolidating and protecting state-owned companies – the industrial, transportation, telecom, and financial giants they own.
In addition to over-reliance on small businesses to do business in the U.S., it only has U.S. customers, and it’s clear that Lotus is very, very vulnerable. One hundred jobs are on the line.
Employment of “prime importance”
An impending unemployment crisis is a nightmare for China’s leaders. The ruling Communist Party worries incessantly about the effects on social stability.
Small but visible protests erupted in Wuhan in April. Workers in a shopping center rallied to demonstrate against rents they could no longer afford.
Total official unemployment in China’s cities has already met the government’s target. There are independent predictions that it could go much higher.
Only a handful of the 100 employees of Lotus United continue working
China’s number two politician, Prime Minister Li Keqiang, acknowledged the magnitude of the problem last month when he said: “The truth is that in April that figure already reached 6% … Employment is the biggest concern in life of people. It is of primary importance to all families. “
Addressing workers at companies like Lotus, Li said: “Many export companies do not have orders now, which has greatly affected their employees.”
“We must support all of these struggling people and businesses, but most importantly, we must help them find jobs.”
But there is one group that the party is particularly concerned about: the graduates.
Under pressure
There are almost nine million graduates entering the Chinese job market this summer.
There are fewer jobs for everyone. Li has admitted that the prospects for them are “bleak.”
Zhang does not expect job situation to improve for graduates within a year
Outside a recruiting fair in Shanghai, 23-year-old Zhang told us, “Yes, we are under pressure. We cannot find work, but we also do not want to stay home and do nothing.”
She is pessimistic. “I hope it won’t improve in a year.”
Many of the job fairs have been connected online. Graduates are looking at a phone camera wearing a mask in hopes of landing their first great job. “We don’t have any internship experience and we didn’t go to the fall job fair,” Zhang explained.
In China’s past, the government used to assign jobs to them. But that is gone.
Provincial governments and state companies are encouraged to recruit graduates. There are tax exemptions on offer.
This is a critical issue for economic recovery and political legitimacy. Young, educated, unemployed, restless and resentful graduates have repeatedly been a problem for the ruling party.
If Huang Xuefeng loses his job at the factory, he will return to agriculture.
Back at the factory, across Italy, Ms. Yakubova has her head up. “I am hopeful that after one, two, I don’t know, three months, let’s say in the near future, that we can restart.”
Some employees have already quit to find another job. The minimum wage that she was forced to impose on them was not enough.
Huang and his wife remain, but they have a plan. “We are under great pressure to live here,” he said. “The rent, the cost of living … if we can’t bear it, we’ll go.”
They will return to the north if the work is done, and become corn and wheat farmers again.
Millions of migrant workers like them could do the same. It would be an unpredictable reversal of China’s vast decades-long urbanization.
