Foxconn Suicides
Suicides at Foxconn
(A causal analysis)
MBAMGT-665
International & Cross-Cultural Management
Fall 2010
Contents
Introduction 2 Wages and Working Hours 2 Workers were kept uninformed about wage increase plan 2 Basic wage is just slightly more than minimum wage and far below living wage 2 Excessive overtime 2 Deduction of overtime premium 2 Frequent change of work shifts 2 Management 2 Punishments 2 Extensive work pressure 2 Reward system 2 Trade Unions 2 Health and Safety 2 Student Workers 2 Relocation Plans 2 Social Factors 2 Conclusion 2 References 2
Introduction Foxconn Technology Group, a subsidy of the Hon Hai Precision Industries Ltd. is one of the world's largest electronics manufacturers. It ranks 112th among Global Fortune 500 Companies. Currently, Foxconn has a workforce of 900,000 workers all over China. The company plans to expand its workforce to 1.3 million people by the end of 2011 (Culpan, 2010). It manufactures hardware for a prestigious list of clients, including Apple, HP, Dell, Nokia and Nintendo. Despite the fall of profit margins over past few years, Foxconn’s business has been growing. This implies that Foxconn will keep lowering labor costs to maintain its competitiveness in the industry.
The recent uproar in media about Foxconn has not been because of its huge workforce or its profits. Rather, it is the seventeen young Foxconn workers who committed suicides between January and August 2010 that has brought into light the plight of frontline workers at Foxconn and other such factories. The suicide rate for China stands at 12 for every 100,000 people per year. With a workforce of 420,000 and 13 suicides this year, the suicide rate at Foxconn is approximately one-quarter the national average (Brook, 2010).
Profit maximization is the ultimate corporate principle, under which workers’ welfare is not given importance. Foxconn is known for its ability to cut costs by mass production, earning big profits for clients
(A causal analysis)
MBAMGT-665
International & Cross-Cultural Management
Fall 2010
Contents
Introduction 2 Wages and Working Hours 2 Workers were kept uninformed about wage increase plan 2 Basic wage is just slightly more than minimum wage and far below living wage 2 Excessive overtime 2 Deduction of overtime premium 2 Frequent change of work shifts 2 Management 2 Punishments 2 Extensive work pressure 2 Reward system 2 Trade Unions 2 Health and Safety 2 Student Workers 2 Relocation Plans 2 Social Factors 2 Conclusion 2 References 2
Introduction Foxconn Technology Group, a subsidy of the Hon Hai Precision Industries Ltd. is one of the world's largest electronics manufacturers. It ranks 112th among Global Fortune 500 Companies. Currently, Foxconn has a workforce of 900,000 workers all over China. The company plans to expand its workforce to 1.3 million people by the end of 2011 (Culpan, 2010). It manufactures hardware for a prestigious list of clients, including Apple, HP, Dell, Nokia and Nintendo. Despite the fall of profit margins over past few years, Foxconn’s business has been growing. This implies that Foxconn will keep lowering labor costs to maintain its competitiveness in the industry.
The recent uproar in media about Foxconn has not been because of its huge workforce or its profits. Rather, it is the seventeen young Foxconn workers who committed suicides between January and August 2010 that has brought into light the plight of frontline workers at Foxconn and other such factories. The suicide rate for China stands at 12 for every 100,000 people per year. With a workforce of 420,000 and 13 suicides this year, the suicide rate at Foxconn is approximately one-quarter the national average (Brook, 2010).
Profit maximization is the ultimate corporate principle, under which workers’ welfare is not given importance. Foxconn is known for its ability to cut costs by mass production, earning big profits for clients
References: (2010). “Let Labourer Work with Dignity”. Xinhua Net. Chan, J. (2010, November 4). China: Report exposes Foxconn’s oppressive work regim. Retrieved from World Socialist Web Site: http://www.wsws.org/articles/2010/nov2010/foxn-n04.shtml Chan, J. (2010). Opposing Military Management at Foxconn Factories in China. wordpress. Culpan, T. (2010, August 18). Foxconn to Hire 400,000 China Workers Within a Year. Bloomberg Businessweek . Moore, M. (2010, June 3). Steve Jobs says Apple is 'all over ' Foxconn suicides. The Telegraph . Pete, B. (2010, November 19). Inside Foxconn City: A Vast Electronics Factory Under Suicide Scrutiny. Retrieved from www.wired.com: http://www.wired.com/rawfile/2010/11/thomas-lee-foxconn/?pid=411 SACOM. (2010). Workers as Machines: Military Management in Foxconn. Hong Kong. Tam, F. &. (2010, May 27). New Foxconn suicide after boss visits Shenzhen plant. South China Morning Post .