Strike! China’s Growing Labor Unrest

Labor unrest is on the rise in China, driven by its economic slowdown and rising expectations for wages and labor rights, and exacerbated by problems in both local governance and China’s social safety net. Risks for businesses – both those with operations in China and those whose supply chains depend on Chinese manufacturing – are proving increasingly problematic.
Incidents of labor unrest in China are increasing. According to the China Labor Bulletin (CLB), Chinese workers engaged in around 185 strikes in 2011. In 2015, the CLB reported 2944 strikes – 16 times as many. Better reporting and data collection may account for some of this growth – but even taking this into consideration, the increase in the frequency of labor protests is alarming.
Another indication of mounting unrest is China’s increasing public security budget. The Chinese Communist Party (CCP) fears that labor protests could escalate and broaden into political uprisings. As such, the CCP places a high priority on policing strikes and labor unrest. The growing need for repressive measures at home to cope with more frequent strikes is reflected in China’s expanding public security spending. National public security spending increased by 15.3 billion RMB (2.4 billion USD) in 2015 and local public security budgets have increased by over 200 billion RMB (30.7 billion USD) since 2010.

This post was published at FinancialSense on 03/11/2016.