The Social Marginalization of Workers in China’s State-Owned Enterprises

Michael Zhang The Social Marginalization of Workers in China’s State-Owned Enterprises THE PROCESS OF RESTRUCTURING CHINA’ S STATE-OWNED ENTERPRISES (SOEs) has seen workers at these enterprises stage repeated collective actions since the late 1990s. Scholars have attributed these sponta­ neous collective actions—especially the massive protests with more than 10,000 participants each in 2002 in northeastern and southwest­ ern China—to a number of factors, including a subsistence crisis, antagonism with capitalist private ownership, and outrage at the corrupt behavior of SOE managers (Chen, 2000, 2003; Lee, 2005; Pan, 2002; Pringle, 2002). In response to the pressures exerted by these collective actions, the government, while still maintaining a nega­ tive attitude toward the actions, has become more tolerant. It has changed its tactics to deal with the workers’ actions and has set up and revised some systems of public administration and social secu­ rity in the hope of nipping such collective actions in the bud for the general purpose of “maintaining social stability and constructing a harmonious society.” This paper will use primary data to present a picture of the social marginalization of the workers in the course of SOE restructuring and define the aftereffects of this process as the root cause of the workers’ collective actions. The author believes that the workers have been grad­ ually deprived ofthe rights and interests entitled to them under China’s labor laws. In addition, the rights and interests given to the workers by the restructuring policies lag behind the restructuring practice. These social research Vol 73 : No 1 : Spring 2006 159 rights and interests have been eroded by the policy implementers in the course of execution, thus triggering intense indignation that has finally evolved into recurring collective actions that are, in fact, the cry of workers who are being marginalized. This paper is divided into four parts. Part 1 describes the influ­ ence of the SOE restructuring policies on the social marginalization of workers and points out that one of the aftereffects of the enactment of these policies is the deprivation of workers’ legal rights and interests. Part 2 illustrates the damage done to the workers’ rights and interests in the course of SOE restructuring and highlights that the restructur­ ing operators have worsened the marginalization of the workers by exploiting their own information advantage. Part 3 describes the work­ ers’ reemployment after restructuring and points out the consequences of marginalization. In the last part, the author concludes, based on a summarization of the foregoing discussion, that the social marginaliza­ tion of the SOE workers is the root cause of the collective actions taken by Chinese workers at the beginning of this century and that those in power should adopt a tolerant attitude and provide such “disadvan­ taged groups” with substantial assistance when such marginalization has become irreversible. The author’s analyses and discussions are mainly based on the records of interviews with workers by Han Dongfang, founder of China Labour Bulletin. Since its launch in 1994, China Labour Bulletin has been concerned with protecting workers’ rights and interests in the course of China’s economic reform and is devoted to promoting a true work­ ers’ movement in China. Han Dongfang has interviewed hundreds of workers by telephone since 1998 and the records of approximately 400 such telephone interviews (some of which have been transcribed) have been broadcast on Radio Free Asia and are also published on the China Labour Bulletin website (http://big5.china-labour.org.hk/public/main). These interview records reflect the workers’ psychological changes during the restructuring and their situation since it took place. They also reveal the deep-seated cause of the collective labor actions that have taken place in the course of restructuring.1 160 social research SOE RESTRUCTURING POLICIES HAVE HAD SIGNIFICANT EFFECTS ON THE SOCIAL MARGINALIZATION OF WORKERS China has entered the final stage of its SOE reform, with a majority of the small and medium-sized SOEs undergoing bankruptcy, closure, or privatization. The reform is intended to lead either to the strategic retreat of the state-owned economy by turning small and medium-size SOEs over to private management by means of sales, transfer, or a jointstock system or...