Chinese Manufacturing Feels Brunt of Global Slowdown

Amid the manufacturing slowdown and decrease in demand for Chinese goods abroad, factories in Guangdong have experienced a recent wave of labor strikes. The strikes recall the labor unrest last year which was primarily due to poor working conditions and mistreatment of workers. The Sydney Morning Herald reports:

Thousands of workers clashed with police on Thursday at a footwear factory in the city of Dongguan after 18 workers were reportedly laid off and overtime was cut. A thousand workers went on strike on Tuesday at the Shenzhen factory of a Taiwanese electronics company. A day earlier, hundreds reportedly struck at a Shenzhen company that makes underwear and lingerie.

The broad unrest this time is thought to be directly linked to the sluggish state of the global economy, particularly the continuing crisis in Europe, which accounts for just over one-fifth of all Chinese exports. Analysts have reported that the euro zone’s debt crisis has already taken a toll on China’s exports, with year-on-year export growth to the European Union down to single digits for the past two months, a sharp fall from August.

As orders have dropped, factories have started to lay off workers, cut overtime and in some cases withhold pay. In Dongguan, scene of the most violent of last week’s strikes, some 450 small and medium-sized factories have closed in the past 10 months as the overseas market has shrunk.

See also: Is Winter Coming for China’s Economy? via CDT.