Next Score View the next score

    Workers on strike at Chinese IBM factory

    HONG KONG — More than 1,000 workers have gone on strike this week at an IBM Corp. factory in southeastern China in the latest sign of labor activism as companies’ acute shortage of blue-collar workers makes employees increasingly willing to take to the streets.

    IBM is selling Lenovo its x86 computer server business, which includes the factory in the southeastern city of Shenzhen, where the strike is unfolding. Lenovo agreed in January to pay $2.3 billion for the business in a transaction that is still subject to regulatory approval.

    A video posted on Chinese social media shows hundreds of workers in blue factory smocks standing Tuesday in front of an IBM building in Shenzhen, a sprawling electronics industry hub adjacent to Hong Kong with more than 10 million permanent residents and migrant workers.


    “Workers are not a commodity,” read one homemade banner; another said, “Give us back our respect.”

    Get Talking Points in your inbox:
    An afternoon recap of the day’s most important business news, delivered weekdays.
    Thank you for signing up! Sign up for more newsletters here

    IBM said in a news release that it hoped workers for the wholly owned subsidiary being sold, International Systems Technology Co. in Shenzhen, would be willing to continue working for Lenovo but that it would offer them compensation if they did not accept the new employer.

    “Employees currently involved in x86 operations in Shenzhen have a personal choice of remaining with I.S.T.C. under terms and conditions comparable in aggregate to what they currently are receiving, or they can voluntarily choose what we believe is an equitable severance package and resign from I.S.T.C.,” the IBM statement said.

    Strikes are especially common in China when factories are sold to new owners, a result of fears of layoffs among workers.

    Geoffrey Crothall, the communications director at the China Labor Bulletin, a nonprofit in Hong Kong that advocates for independent collective bargaining and other legal protections for workers in mainland China, said that the latest strike was reminiscent of one by thousands of Nokia workers in November in Dongguan, next to Shenzhen.


    In that case, Nokia shareholders had approved the sale of their employer, Nokia’s handset division, to Microsoft.

    “We’ve seen so many similar cases over the last two to three years,” Crothall said.

    A quadrupling of college enrollments over the past decade, together with the beginnings of a decline in the number of young Chinese as a result of the country’s one-child policy, has left a dearth of young people willing to take factory jobs. Age discrimination is also widespread in China, where factories seldom hire anyone older than 40.

    Demographic issues have affected the Chinese workplace faster and to a greater extent than almost any experts expected. Wages for blue-collar workers have increased about fivefold over the past decade before adjusting for inflation and at least threefold after adjusting for inflation.

    Workers have also become quicker to object if they think their legal rights are being abused.


    “Over the last five years, there has been a noticeable upswing in worker activism across China,” Crothall said.

    A report from the China Labor Bulletin on Feb. 20 said that the group had recorded 1,171 strikes and worker protests from mid-2011 until the end of 2013.