Trying to fight a hazy future

SUN JOURNAL

Layoffs: With many state-owned companies in China cutting labor forces, out-of-work employees wonder how they'll make ends meet -- and how to push for changes.

April 12, 2002|By Frank Langfitt | Frank Langfitt,SUN FOREIGN STAFF

JILIN CITY, China - Chanting "Raise our pay!" thousands of workers took to the streets here last spring, blocked traffic for hours and made their complaints about their employer known to everyone. Jilin Chemical Industrial Co., a state-owned company, was about to cut them from the payroll. They wanted higher severance pay.

Some workers believed that their demands would be met.

But when the protests resumed for a second day, police armed with submachine guns surrounded the demonstrators and detained those leading the chants. When a group of workers blocked a train, police detained them, too.

By the fourth day, the protest had been crushed.

"At first, everyone had a pretty unified heart," said Lu Chunji, a laid-off factory worker who had joined the crowds outside the gates of the company's headquarters. But "when they saw so many police and plainclothes officers, they were very afraid."

That is how most Chinese labor demonstrations end: with a mixture of intimidation, arrests and small payoffs to disgruntled employees. Since the mid-1990s, local governments have used those tactics to defuse protests here in the country's northeastern rust belt and elsewhere.

In the past month, tens of thousands of laid-off laborers have demonstrated in the northeastern cities of Daqing, Liaoyang and Fushun against what they said were stingy severance packages, late payment of living allowances and corporate corruption. Local officials brought the protests under control by promising more money, dispatching police and arresting a few protest leaders.

The Chinese government's consistent carrot-and-stick approach has prevented workers from forming independent labor unions and halted any organized challenge to the Communist Party's monopoly on power. The regime's control over state-run media - no other kind is permitted - appears to have helped prevent word of demonstrations from spreading and inspiring workers in other cities.

Since 1995, China's state-owned enterprises have laid off more than 40 million employees, more than the combined populations of New York and Texas. The restructuring is part of a long process to transform a command economy into a more market-oriented one. The layoffs have caused enormous distress among state workers who grew up in a socialist system that guaranteed them jobs for life.

One of the hardest hit parts of the country is the northeast, an area once known as Manchuria, where local economies were built around state-run industries now saddled with more laborers than they need.

Companies began laying off millions of workers in the 1990s but continued to pay them small stipends. The recent round of demonstrations has come as companies move to end their financial responsibilities to employees through a process known as mai duan, literally "buy and cut."

Companies are offering workers one-time severance payments and ending free services, such as heating workers' apartments. Workers, many in their 40s, complain that the lump-sum payouts are too small.

The Jilin company, for instance, offered laborers $235 for each year of service, a bit more than two months' salary for some employees. Workers say they cannot get other jobs with the tight economy, in which recent graduates struggle to find employment.

"If they are laid off after the age of 40, there is no chance for them," said Frank Prasmo, deputy general manager at the Century Swiss-Belhotel, the city's leading hotel, which laid off 60 workers last month. "It's tragic here in Northeast China."

The situation in Jilin City, which lies more than 700 miles northeast of Beijing, illustrates the difficulties that laid-off workers face as they try to adjust to China's rapidly changing economy and stand up to state-run companies.

The city lies along the sandy banks of the Songhua River. On the northern edge of town sits Jilin Chemical, one of the largest companies of its kind in the country. The main compound, surrounded by brick walls, is a collection of smokestacks and decrepit factories with broken, soot-stained windows. Since the beginning of 2000, Jilin and its affiliated companies here have laid off 20,000 to 30,000 laborers, former employees say.

Last April's demonstration began after Jilin workers learned that laborers at a sister company in Daqing were offered more than twice as much money in severance packages. Lu said the protest collapsed quickly because organizers were too frightened to lead.

"If they had called people together and put forward several requests and told us what to do, we would have followed them," said Lu, sitting in the back of a grocery store in one of the company's apartment complexes. "The result would have been different."

Most workers are understandably reluctant to lead protests, which are virtually banned. Anyone who tries to organize demonstrations risks years in prison.

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