Socio-Economic Transformation and Industrial Relations in China

Principal Investigator (PI): PD Dr. Boy Lüthje

Funded by Hans-Böckler-Foundation

Period of funding: January 2008 until December 2010

The purpose of this research project was to provide a systematic study of the changing shape of industrial relations in China under the conditions of globalization. The project undertook a broad-based empirical investigation of the emerging patterns of industrial relations in industries which play a key role for the development of China as a global manufacturing base and towards a science and innovation-based society, as proposed under recent economic development strategies.

The project was developed in cooperation with Prof. Chang Kai, School of Labor Relations and Human Resources at Renmin University, Beijing. Renmin University also hosted the field research during the main phase of the project in 2008-09. The final stages of the research were supported by the Joint Center for International Labor Research at the School of Government of Sun Yat-Sen University, Guangzhou.

For the first time, this study provided a comparative analysis of industrial relations in the context of new forms of work organization in a relevant sample of modern Chinese manufacturing industries, including multinational corporations, Sino-foreign joint ventures, Overseas Chinese-invested companies, as well as Chinese State Owned Enterprises (SOE). Field work was conducted by a joint team of Chinese and German labor researchers, special support was given from international works councils and trade union organizations.

As opposed to most mainstream and neo-liberal analysis of China’s reform and opening, the project departs from the assumption that China has moved beyond the stage of a »transformation economy«, in which economic and social development is primarily determined by the transition from »plan« to »market«. Rather, we see an emerging post-socialist market-economy which is producing its own distinct forms of economic development and institutional regulation centered on a strong developmental state. This new formation of capitalism is based in the specific conditions of a country in which the planned economy had performed the historic task of industrialization and modernization, substituting for indigenous capitalist development over a long period of time. In this context, a specific system of industrial relations is emerging, shaped both by government policies to ensure »harmonious« development of market relations and to mitigate the contradictions of the capitalist world-market.
The rapid transformation has produced widespread insecurity in the field of capital-labor relations – Chinese scholars even speak of a »crisis of industrial relations in China«. This perception relates to an increasing social inequality and polarization within the workforce, but also to the vulnerability of the industrial relations system established since the 1990s to the pressure of multinational companies including the threat of disinvestment (as in the recent debate over the labor contract law). Moreover, the regionalization of industrial development of competing industrial centers along the East Coast and now in inner China is producing an increasing variety of industrial relations practices across industries, companies and regions – ranging from established Chinese models of union workplace representation over European-style corporatism and bureaucratic paternalism as known from Asian countries to distinctively non-union regimes.

This process is accompanied by the adaptation of all kinds of foreign concepts of work organization and human resource management, producing new patterns of industrial conflict and regulation especially in leading-edge industries dominated by multinationals. Labor migration and diverse strategies at the local and company level to integrate migrant labor into the production process are adding further varieties as well as social contradictions to this picture.

This situation calls for a new view on Chinese industrial relations focused on the contradictions between capital and labor in an advanced post-socialist economy, the divergence and convergence of labor relations in indigenous state-owned and private, mostly foreign-owned enterprises, and the variety of labor policies across regions and industries. Such a perspective has to reach beyond traditional industrial relations research focused on corporate, contractual and government institutions. The analysis of shop-floor and company level labor relations has to be based on a thorough understanding of the changing shape of global production systems. At the same time, the changing organization of work in Chinese enterprises has to be taken into consideration, in order to assess the question whether and how modern forms of work organization can emerge or whether we will see a large-scale return of neo-Taylorist mass production work in China.

The research program is based on the existing work of the authors on industrial relations in China and on global production networks. It will consist of three »building blocks«:

(1) A reassessment of current international and Chinese academic research on the development of industrial relations during the reform period in China, in order to sharpen the conceptual framework for the field studies. This included discussions of key concepts of contemporary international industrial sociology and industrial relations literature and their applicability to China. One key question was, whether concepts of corporatism can offer a better understanding to describe the contradictory relationship between confrontation and consensus in Chinese industrial relations at the plant, corporate and local level.

(2) Empirical research on regimes of production in key manufacturing industries. The research started from a sectoral analysis of labor relations in the automobile, the steel, the chemical, the electronics and the textile and garment industry. The sectoral perspective was accompanied by in-depth case studies of the regime of production in leading companies in each sector, representing the different types of enterprises, ownership and integration into global production networks prevalent in the respective industries. The research initially covered multinational, Chinese and Overseas Chinese flagship firms in various regions, smaller and medium-sized companies were considered at a later stage.

(3) In-depth discussion of the implications of the changes found in Chinese industrial relations with regard to the relocation of production and employment from developed countries to China, international labor-standards in the respective industries and corporations, and trade union cooperation and organizing. This section of the research elaborated on the complex relationship between international labor standards and the dynamics of building institutionalized labor relations and trade union organization in China, as developed in the context of earlier academic and trade union exchange projects supported by Hans-Böckler-Stiftung.

The project was concluded in 2010, the research report was delivered to Hans-Böckler-Stiftung and approved by the project advisory council in the summer of 2011. An edited version of the full research report is due to be published in June 2013 under the title:

Lüthje, Boy/Siqi Luo/Zhang Hao (2013): Beyond the Iron Rice Bowl. Regimes of Production and Industrial Relations in China. Frankfurt/New York: Campus.



Chen, Weiguang und Boy Lüthje 2011: Trade Unions and Worker Struggles in Guangdong. Chen Weiguang interviewed by Boy Lüthje, in: Global Labour Column 55, 3.

Lüthje, Boy 2010: Belegschaften und Gewerkschaften in China in der Wirtschaftskrise. Tripartis­mus mit vier Parteien?, in: WSI-Mitteilungen 9, 473–479.

Lüthje, Boy 2010: »Sag mir, wo Du stehst« – Lehren aus den Streiks bei Autozulieferern in Südchina, in: Express 12.

Lüthje, Boy 2011: Auto Worker Strikes in China: What Did They Win?, in: Labor Notes.  | mehr …

Lüthje, Boy 2011: Which Side are you on? Lessons from the Strikes at Auto Suppliers in South China, in: Asian Labour Update 78, 15–20.

Lüthje, Boy 2012: China. Woran scheitert der Umbau des Wachstumsmodells?, in: Gegenblende. Das gewerkschaftliche Debattenmagazin 13.

Lüthje, Boy 2013: Why is there no Fordism in China: Regimes of Accumulation and Indus­trial Reorganization in Chinese Manurfacturing Industries. IfS Working paper 2. Submitted for publication to: Socio Eco­nomic Review.

Lüthje, Boy 2013: Corporatism with Chinese Characteristics? Regimes of Production in German Transnationals in China, in: Anita Chan (Hg.): Chinese Labor in Comparative Perspec­tive. Ithaca, NY: ILR Press.

Lüthje, Boy 2013: Labor Relations, Regimes of Production, and Labor Conflicts in the Chinese Automotive Sector, in: International Labour Review.

Luo, Siqi 2011: Collective Contract, but no Collective Bargaining, in: Christoph Scherrer (Hg.): China’s Labor Question. München und Mering: Hampp, 49–69.

Luo, Siqi 2013: Collective Bargaining and Changing Industrial Relations in China. Lessons from the U. S. and Germany. Frankfurt a. M.: Peter Lang.