Apple's Chinese labourers get 1.6 per cent of iPad loot - report

As Apple desperately tries to repaint itself as a caring company when it comes to workers’ rights, news has emerged that employees in its suppliers’ Chinese factories get just $8 of the $499 sale price of each iPad 2. Several news sources cite a Korea Daily report which claims that, based on average salaries, workers in the …

[Anonymous Coward]

Soooooo

The real story is that chinese suppliers pay their workers less than the South Korean manfacturers? This is an apple issue because?

Let's assume apple offer the chinese supplier more money, say oh 20 dollars per unit more. do we:

a) Believe that the supplier will suddenly give their people a raise

b) That they would give them an extra 20c and take the rest??

c) Apple insist on wage raises, which the supplier agrees to, and completely hides in some nefarious way?

Oh but Apple could insist they pay more, and monitor, and and and ... you say???? hmmm

Look I am all for bashing apple for:

Overpriced products

Outsourcing

Not caring about working conditions

Ridiculous lawyer baiting

Stupid attempts at blocking technological competitiveness

What I am not sure on is how they fundamentally affect a market economy?

PS It is also not clear how they are comparing the S Korean supplier to the Chinese supplier here, or am I missing something?

[Daf L]

Redstribution of wealth

I think the article is suggesting that seeing as the complete product is made there then Apple should be philanthropic and spread a little of its wealth back to the people who have helped make it so profitable.

However, Apple don't pay a dividend even to it's shareholders, so presuming they will pass some money charitably and on their own accord is fairly slim.

[Marvin the Martian]

"This is an apple issue because?"

What I find strange is that ElReg persists in making it an Apple issue, when Foxconn builds laptops for almost any brand.

[Geoff May]

How does their salary compare ...

I'm curious to know how much the $8 buys in China and how their (monthly) salaries compare to other people employed in factories in the same area.

It's all very well for us superior Westerners pass judgement on how much lower the salaries are elsewhere in the world but, for all we know, $8 in this area might buy you 80 loaves of bread, 8 diseases of your choice from the local hooker community and still leave money left over for that nice little retirement home ...

Or it might buy you 1 cigarette and a begging bowl.

[Anonymous Coward]

All it says is that they're getting $8 per iPad. If a worker bashes out 10 iPads a day....

[jonathanb]

I agree. Given that Foxcomm workers get free food, uniforms and accommodation, every Renminbi they get in their hand is spare cash for extras, or for saving up a nest egg for the future. $8 per iPad produced, for presumably more than one iPad per day probably isn't that bad considering how much things cost over there.

[popper]

are you serious jonathan, try reading some of the SASCOM (Students & Scholars Against Corporate Misbehaviour) reports and get far more realistic idea of workers conditions,pay, accommodation etc from their very mouths

iv not even begun to look in to them properly yet but they paint a very different picture to the one you seem to have and want to paint.

http://www.youtube.com/watch?v=V3YFGixp9Jw

"at foxconn there is a common saying:

women work as hard as men,

men work as hard as machines,

thats how it goes.

we wake up before the roosters,

go to sleep after the dogs,

Eat worse that the pig's."

http://sacom.hk/wp-content/uploads/2011/09/20110924-islave-behind-the-iphone.pdf

"Low wages

“We have to pay CNY 150 for dormitory and about CNY 200-300 for food. After these

deductions, our basic salary is only CNY 950,” said a female worker who had joined Foxconn 2

months prior.

Many workers have grievances about the low wages at Foxconn. They are particularly

disappointed about the false statements in the job advertisements. Zhang De-qiang, who left his former company to join Foxconn, complained, “The labour department made false promises to us about the salary at Foxconn. It claimed we could earn over CNY 2500 per month.” Zhang only knew about the real basic wage when he signed the contract. The Foxconn staff who handled the application sneered at him and asked him to leave immediately if he was not happy with the terms...."

[popper]

P2

http://sacom.hk/wp-content/uploads/2011/05/2011-05-06_foxconn-and-apple-fail-to-fulfill-promises1.pdf

"asic salary is far from a living wage

SACOM suggested that the living wage in Shenzhen was about CNY 2300 referencing to the Engel Law formula in last year.

Owing to skyrocketed inflation in the cities, the living wage in2011 should be CNY 2728.8 And the monthly living wage in Chongqing should be CNY 2192.

SACOM estimates the living wage in Chengdu should be CNY 2600.9 This echoes the aspiration of the workers that a monthly income should be around CNY 2500 in Chengdu and Chongqing, and CNY 3000 in Shenzhen.

In other words, the basic salary at Foxconn in the three cities lags behind the basic needs of workers. Eventually, workers have to earn a living from overtime work.

“I work very hard everyday and I deserve CNY 3000-4000 per month.,”..."

[cut lots as text is tight read the original]

Not many workers have experience to decline overtime work. During low season, a request for an un-overtime shift will be easily approved by supervisors. In contrast, if there is influx of order, workers must stay for overtime shift. Penalty may be imposed if workers decline overtime shift."

and far more, perhaps el reg should take a serious look and condense these and other figures and their meaning today into a condensed pocket edition.

[Daf L]

The figures are meaningless

They do not represent anything other than how little of the sale cost actually goes to those who create it and how they can afford to pass a greater percentage to other factories in other countries.

It is a cost per product so without knowing the number of employees, the number of products made etc then the article itself does not mean a lot as each employee will see only a few cents of that.

The questions to be asking are - is there an *exploitation* of those workers due to the lack of a welfare state that forces them to work in dangerous, sub standard conditions without adequate recompense due to the real and present danger that not working would mean 'real' and critical poverty (i.e. not Western definitions of poverty).

Also, should Apple consider whether a company that could have greater working standard with the same quality of manufacture would be worth paying $10 (or more) a unit for and take the hit out of their massive profits? If they can lose much more per unit in another country then perhaps, they could also do it in China?

[jonathanb]

Re: How does their salary compare ...

$8 gets 3.28 big macs, compared with 2.09 big macs in the UK.

Source http://www.economist.com/blogs/graphicdetail/2012/01/daily-chart-3

[Pete the not so great]

Quite right

How else are they going to make those massive margins?

[Chris Miller]

Quite right

>40% GPM last year, cf LVMH (handbags, perfume, premium booze) ~14%.

[Anonymous Coward]

In other news

Car workers only get a few quid for each car sold. TV workers only get a few quid for each TV sold. Etc.

I think you'll find that, for any mass produced product, an individual worker only gets paid a small % of the retail price per unit. That's sort of the point of mass production and globalisation. The very successful sales job that's been done to promote the global shafting of workers will accelerate this tendency for the foreseeable future.

While everyone decries the rates paid in China and clamours for onshoring, our political and business masters are plotting how to bring onshore conditions down to match those in China.

Feel free to shop around for a hand-carved mahogany motherboard for your next PC

[Chad H.]

China in low wages shocker

File this one under "we wouldn't give a rats ass if we couldn't link it to Apple"

[Anonymous Coward]

Re: China in low wages shocker

Do rats have asses?

[Anonymous Coward]

% of retail price

I hear that robots get paid 0% of the retail price of goods they produce.

Fight for robot rights.

[Anonymous Coward]

Well, quite

we just don't have the information to say *what* this $8 means. Or how much of the rest of the price is paying for depreciation on the plant (including robots.) We can safely predict that the rich will continue to get *relatively* richer at minimal effort.

[technohead95]

Apple is responsible

Apple has a huge influence over the work ethics used by the Chinese companies. They are morally responsible to ensure that the ground engineers are being treated fairly by making sure the Chinese companies they use are fair. I think some of this is caused by Apple's greed in squeezing every penny of profit from their devices. All companies are out to maximise profit, I get that, but there's a limit on how much profit you can squeeze before you hurt the very work force and supply chain.

[Jeebus]

It's about now that we get the Apple apologists running their mouths about how every company does it, which makes it morally and ethically fine, for some reason.

[David Evans]

@jeebus

I'm no Apple apologist (far from it as many comments on this very site will confirm), but this article does strike me as trying to make some kind of Apple-bashing point without any sense of context. Criticise the general principle of low-cost outsourcing to cheap labour countries by all means, but unless a Chinese employee's "cut" of an iPad is significantly less than for other foreign owned products (something this article singularly fails to address), then you really do have to cut Apple some slack on this one.

[CollyWolly]

I'm no apologist but......

In my experience, any comment starting with "I'm no fanboi / apologist but", will almost guarantee a faboi / appologist comment to follow.

And well done for almost doing exactly what the previous poster suggested some apologist would do next- claim that it is fine for Apple to do it because everyone else does.

[David Evans]

Re: I'm no apologist but......

well done for not actually bothering to read what I said. I never once said it was fine for Apple to do it because everyone else does, because without showing what everyone else does, you have no context. For all you or I know, they could be paying better than the norm. And yes you could still argue that Apple are wrong to source in China on general principles (and I wouldn't necessarily disagree - as I ALSO said), but what we have right now is only part of an article, not all of the facts.

[Anonymous Coward]

And you're posting this from your ethical PC?

The one with the CPU hand crafted in Norway by elves?

[Ted Treen]

@Jeebus

Not at all - we might point out that Dell etc., etc., also use Foxconn and others, where terms, conditions, pay rates & margins are ALL going to be much of a muchness.

We also point out that at least Apple are doing something - whether it's enough is a subjective matter, not an objective point - to deal with this issue, whereas the actions of pretty well every other manufacturer/assembler are conspicuous by their complete absence.

[porovaara]

Match your wage scales.

A typical, dine-out restaurant meal is anywhere from 80-150 CNY.

$8US is 50 CNY.

[jai]

Re: Match your wage scales.

so if you build 3 ipads in a day, you can afford a nice restaurant meal that night?

and lets face it, these guys aren't soldering the components, it's fitting together parts into the ipad casing. so you can probably build 10, 20, 30 a day? once you get used to it, I think 20 a day should be easy. so that's quite a good wage then, by comparison.

[Sir Runcible Spoon]

Sir

Quite a few people seem to be thinking that it is $8 per worker, per iPad.

I think it might be $8 per workforce, per iPad - workforce=unknown so the figure is meaningless at the moment as quite a few people have pointed out.

[steogede]

@jai

>> and lets face it, these guys aren't soldering the components, it's fitting together parts into the ipad casing. so you can probably build 10, 20, 30 a day? once you get used to it, I think 20 a day should be easy. so that's quite a good wage then, by comparison.

I would be very surprised if they are assembling a complete iPad. They will be perhaps 1 of (say) 25 cogs in a wheel. Assuming all 25 cogs are the same size, 20 a day would mean repeating their task 500. Sounds reasonable. $160/day seems like a reasonable wage.

The only way to come to this figure is to make a lot of assumptions - as many others have pointed out, the article is lacking on details. But even without the efficiencies of a production line, I reckon I could build 20 iPads/day if I were doing it day in day out (and I'm a stubby fingered westerner). It would be one every 30 minutes on a ten hour shift.

Ofcourse when they say $8 per iPad per worker does that equal take home pay per assembly worker? Or are there overheads which need to be paid out of that $8 first e.g. power costs, admin/support/cleaning staff, robot maintenance... - so, tell us how much per hour the assembly workers are getting, and maybe then we can comment on it.

[Anonymous Coward]

Surely this is what capitalism is all about?

If you don't like it, move to a communist country like - China. Oh, wait.

[French Tickler]

Seriously?

Yet again - a fact that we all know - chinese workers don't get paid well.......Shocker

But becuase they manufacture Apple products it becomes news?

Seriously do you have a load of ex NotW and The Sun reporters working at El Reg or are you that desperate to get a story out that you have to do this.

Get a grip guys, there are so many better thinhgs to write about....

[Ian Ferguson]

Meaningless

without comparison to what other manufacturers pay Chinese workers.

[deadlockvictim]

I believe that there is relevant saying from a holy man for this situation

No big deal.

We may have cared about wage-slaves in the Third World before, but we never did anything about it in a constructive way, except, possibly, feel a bit guilty. We still went on buying.

Could we have a hypocrisy check, please, before people are allowed to post their indignity on the topic of how poor the workers in China are, please? Only those wearing and owning nothing that was made by slaves for a mere pittance may post. Just check the labels on your clothes for Indonesia, Malaysia, China and so on.

Let he (or she for that matter) who is without sin cast the first stone.

[Crisp]

Makes me wonder

What would their quality of life be like if they were paid a little more.

It's not like Apple can't afford it. They turned far too much of a profit this year.

[Anonymous Coward]

Re: Makes me wonder

Obvious troll is obvious. Thankyou for showing us how poor their quality of life is compared to other chinese workers

[Crisp]

@AC 13:58

Yeah, what was I thinking? Those Chinese workers don't need that money. I'm sure Apple needs it all to fill a Scrooge McDuck style money pit.

[Law]

Forgive me if I'm wrong but...

... isn't that the whole reason why they make things in China to begin with... it's cheaper??

Not saying it's right - just that it would have been one of the major plus points of building in China over somewhere like Britain, Canada or the US?

[Van]

I think the reason theyre picking on Apple, is compared to the others mentioned, Apple are massively profitable. Selling products at the luxury end of the market, in the ipads case a product many people use as a toy.

New mass produced cars barely have a mark-up, for the person who brought that struggling industry into it.

[jai]

really needs a comparison to how much workers in factories for other products get.

workers in south korea get 6 times the pay of those in china. are they doing the same role? or are the ones in china just bolting together the screens and the boards and the casing and putting them in boxes, and the south korea workers are fabricating the LCDs? it'd be a great world if we were all paid exactly the same regardless of the work we did, but that's not how it works.

[Adam T]

Silly way to analyse salaries

If I work out the salaries of the people that work for me, they either make less than 1% of a single product's daily profit, or they make >1000% of the same product's unit cost.

Salaries aren't based on individual product prices, they're based on the value of the person in the chain. The price of an iPad may be exorbitant over here, but then we've only got ourselves to blame for buying them at that price haven't we.

[David Kelly 2]

So if Apple was not there they would get more? I think they would get even less.

[Field Marshal Von Krakenfart]

Blocking all imports and exports

"but Proview has already upped the ante by asking a Chinese court to block all imports and exports too. "

I wonder where they got that idea from, may I be the first to go:-

Ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha.

[Gil Grissum]

Really?

So, on one hand Apple is supposed to be responsible for how it's suppliers treat their employees and "reinvest" in China? Apple already is investing in China be paying suppliers to build their products there.

And on the other hand a Chinese company (Proview) can apparently marshall the local law enforcement to remove iPads from Stores while also petitioning to prevent them from being exported out of China, effectively cutting off the supply chain? That's an interesting response to all the legal filings to block Samsung (which is located in South Korea, not China) from selling their products.

Maybe Apple should just go ahead and rename the iPad 3 something else. Then, The Chinese government will have no legal reason to block sales or exports of the iPad 3, or whatever Apple chooses to call it. Maybe it's time to rethink the whole "i" thing now?

[Scott 1]

Re: Really?

Maybe Apple should just go ahead and rename the iPad 3 something else. Then, The Chinese government will have no legal reason to block sales or exports of the iPad 3, or whatever Apple chooses to call it. Maybe it's time to rethink the whole "i" thing now?

Let's not forget that El Reg has already claimed "Fondlestab" (or is that a general British thing? -- it's tough to tell on this side of the pond, sometimes).

[Mikel]

Making a business

Selling rocks to each other at a loss - but making it up in volume.

[mhenriday]

The choice of Foxconn to manufacture Apple products was, no doubt,

one of the reasons why The Jobs was lauded as a business genius. The brillance really comes through when one learns how Hon Hai/Foxconn's Guo Taiming (aka «Terry Gou» - another business genius and the same chap that requested advice from the head of the zoo in Taipei with regard to how handle his workers) manages to further lower the amounts paid to workers by the judicious use of «internships» (http://motherboard.vice.com/2012/2/15/foxconn-s-other-dirty-secret-the-world-s-largest-internship-program)....

But this worm may turn....