Abstract
Sarosh Kuruvilla, Ching Kwan Lee and Mary E Gallagher (eds), From Iron Rice Bowl to Informalization: Markets, Workers and the State in a Changing China , Ithaca, NY, and London: ILR/Cornell University Press, 2011; vii + 233 pp., US$39.95 (hbk).
This edited collection addresses a significant theme through a series of interesting studies. The variety of topics, approaches and intellectual traditions makes for stimulating reading. The book nonetheless benefits from consistency of focus and style.
The editors’ starting point (Chapter 1) is that China’s dramatic transition to a market-based economy has generated a particular type of capitalistic labour market: one permitting employees to suffer pervasive, exploitative ‘informalised’ experiences. Long-standing strategic choices by China’s party-state – at national and local levels – have created the particular dynamics among state, employers and workers that the book investigates.
Informalisation here (p. 2) means employment lacking: (a) stability or security; (b) a written agreement or contract; and (c) access to social insurance or benefits. The editors appear to believe that only one of these criteria is necessary for informalisation, hence the catastrophic dimensions of the phenomenon they present: between 35% and 39% of the urban workforce is informal. Yet this definition is too broad. Lack of employment security does not make one ‘informal’, just insecure. Similarly, the editors and authors of some other chapters confuse informalisation with labour market segmentation, resulting in a secondary labour market of often contingent employment; the two may coincide but need not.
The book tells a story of sometimes shocking suffering, exploitation and exclusion. As the editors note, this also reflects China having become, in just 30 years, one of Asia’s most unequal societies. The interactions of the party-state – at different levels, and product and labour markets – including employers (of all stripes) and contract labour agents, hold the book’s centre stage. Nevertheless, the employees most directly affected, including the masses of migrant workers, never appear as just mere statistics. This book gives them a voice.
Following the Introduction, the book has three sections (nine chapters) that respectively address the core elements in the social dynamics the editors laid out: the party-state, employers, and prospects for workers. Each chapter explains the historical development of its topic since Maoist times and has something thoughtful to say about current and likely future developments. Furthermore, each introduces something of their authors’ own research that extends or enriches current understandings. The editors have delivered a well-designed and organised research project.
In Chapter 2, Albert Park and Fang Cai provide a series of data useful for understanding the extent, main locations and demographic characteristics of informalisation (understood through a range of criteria). Mary E Gallagher and Baohua Dong then present an interesting (if repetitive) explanation of labour law reform, focusing on the Labour Law 1994 and, particularly, controversy and contest during development of the Labour Contract Law 2008. They pay particular attention to how recent legislation sought to respond to public dissent over compromised implementation by local administrations. Tracing countervailing pressures from employers (particularly associations representing foreign-based multinationals), different segments of the party-state, and its official union (the All China Federation of Trade Unions (ACFTU)), the authors present a more optimistic scenario for future regulatory protection of employees, albeit one still potentially hostage to local governmental perfidies.
Mark W Frazier delivers a wonderful exploration of the troubled development of social security policy and practice (and gaps between), particularly in regard to retirement pensions. His is one of the few contributions providing (welcome) international comparisons. Frazier also provides his own data and discussion on public expectations as to who should be responsible for retirement pensions: central government, local government, employers and employees jointly, or individuals. Responses suggest a deep social-democratic sensibility; people may begrudgingly accept a capitalist labour market but place responsibility on the government to provide for their retirement security. The Social Insurance Law 2010 appeared late in the book’s preparation, and perhaps to Frazier’s surprise (p. 66). It seems to meet the criteria that he and public opinion require (as gauged by his research), particularly by covering migrant workers. Will it reduce this dimension of informalisation? Again, this depends on implementation, and the goodwill and good governance of local government.
Part 2 contains three industry studies examining how employers have contributed to dystopian outcomes of the party-state’s embrace of neo-liberalism. The three sectors are well chosen for their diverse product and labour markets, mix of ownership types, and type and scale of economic activity. Kun-Chin Lin examines the oilfields and refineries sector under corporatised state ownership. Here, pernicious corporate restructuring – via contracting between profit and cost centres within corporations – directs all product and labour ‘market’ advantages to profit centres, and all disadvantages to cost centres. Their respective workforces share these fates. Discussion of how one ends up on one side rather than the other and whether there is movement across that divide would have been a better use of words than the author’s confusing diversion into network theory. Lin’s contribution is valuable, but it is not about informalisation; the inequalities presented are embedded through formal arrangements, as were the mass retrenchments visited on cost centres.
Lu Zhang examines labour force dualism in China’s automobile industry, the world’s largest. One might not usually expect pervasive informalisation in a ‘capital-intensive pillar industry’ (p. 106) driven by heavy state and foreign private investment. Indeed, it appears that the contingent employment effects of dualistic discrimination lay behind the industry’s major strikes during 2010, not informalisation. Zhang’s exemplary account makes the causes clear: employers, seeking production and cost flexibilities, increasingly use short-term contract employees or agency labour alongside better-placed, long-term and permanent employees. Those in the secondary segment are formally employed but receive inferior treatment, and employers use them to drive down wages and conditions in the primary segment.
Sarah Swider examines, with great originality, how further segmentation within the construction industry’s secondary and informal labour market creates ‘permanent temporariness’ among migrant workers from rural areas. Ghettoised by their ‘mode of employment’ into a series of fenced, urban construction sites where they live as well as work, these workers never attain knowledge or inclusion within host locales while gradually losing their human connection to their hometowns. They are victims of China’s locationally uneven development, lax labour regulation enforcement and the rigidities of the hukou local registration system that ties a person’s access to state-provided benefits – like education, health care and housing – to his or her original registered locality.
What can be done? The central state has created the elements underlying market dynamics that favour miscreant employers. Local governments, competing to attract investment for economic growth, constitute one major problem. Can they be part of the solution? Some chapters suggest that China’s neo-liberalism must, at times, confront the residual, powerful effects of widely shared socialist beliefs. The book provides plentiful evidence of local protests, demonstrations and strikes targeting local authorities responsible for their problems. Similarly, it identifies how mounting, active unrest from below is generating anxiety among a central party-state leadership for whom regime legitimacy remains crucial. They could do much more to ensure proper local implementation and enforcement of employment regulation. Some chapters suggest that they do intend to deliver improvements.
Part 3 presents other options: action by unions and non-government organisations (NGOs). China’s neo-liberalism represses autonomous unionism while trying to keep the ACFTU captive and indolent. As Mingwei Liu points out in his chapter on unions, this is what party officials attempt at national and local levels. Company managements either repress or co-opt enterprise-level unions. Nevertheless, Liu finds causes for optimism. Regional ACFTU bodies have developed new types of inter-firm union structures that effectively organise and even collectively bargain. Intriguingly, much of this new activism receives crucial support, including funding, from local governments. Yet, as Liu admits, this dependence, for legitimacy and resources, presents another potential constraint.
Much impressive workers’ resistance runs outside union channels. Can they sustain this? From where will they draw resources? Ching Wan Lee and Yuan Shen critically discuss the role of labour-oriented NGOs, important sources of advice, labour-law education, advocacy and publicity for those ignored by formal organisations. The authors clearly disapprove of some of these NGOs’ objectives and programmes, including tendencies that foster anti-solidaristic influences or that reinforce the legitimacy of the party-state.
The editors’ Conclusion evokes their Introduction’s pessimism, claiming support from the other chapters. My reading suggests the opposite. None of the other chapters are as pessimistic. Whether explicit in their discussions or implicit in their evidence, the other chapters provide ample signs for optimism. Indeed, as the editors end their conclusion, they too appear to see such signs.
A few weaknesses undermine this book’s important contribution and high standards. For a 2011 publication, much of the primary data used is quite old, mostly earlier than 2005. Discussion in the present tense is often referenced to the late 1990s or early 2000s. Much of the long-run financial data is not indexed for inflation, making meaningful comparisons difficult. Some chapters needed closer editing: Chapter 5’s concluding pages seem hurriedly cut and pasted from elsewhere; some tables in Chapters 4 and 5 are assembled incorrectly. Nevertheless, this volume will be of great interest to scholars and students of contemporary China, employment relations and state–market relations.