The story of Shenzhen’s boom is in a sense the first chapter in modern China’s industrialization. “During the founding period, Shenzhen people were bold and resolute in smashing the trammels of the old ideas,” says the English version of the city’s history, as recounted in Shenzhen’s municipal museum in an odd, modern-Chinese combination of Maoist bombast and supercapitalist perspective. “With the market-oriented reforms as the breakthrough point, they shook off the yoke of the planned economy, and gradually built up new management systems.”
What all this refers to is the establishment, in the late summer of 1980, of Shenzhen as a “special economic zone,” where few limits or controls would apply and businesses from around the world would be invited to set up shop. Shenzhen was attractive as an experimental locale, not just because it was so close to Hong Kong, with its efficient harbor and airport, but also because it was so far from Beijing. If the experiment went wrong, the consequences could be more easily contained in this southern extremity of the country. Nearly every rule that might restrict business development was changed or removed in Shenzhen. Several free-trade processing zones were established, where materials and machinery coming in and exports going out would be exempt from the usual duties or taxes.
Modern Shenzhen has traits that Americans would associate with a booming Sun Belt city—transient, rough, unmannered, full of opportunity—and that characterized Manchester, Detroit, Chicago, Los Angeles at their times of fastest growth.
The foreigners in their 30s through 50s who come to Shanghai are often financiers, consultants, or lawyers. They tend to be lean, with good suits and haircuts. Those in Beijing are often diplomats, academics, or from foundations or NGOs. They look a little less polished. The scene in and around Shenzhen is different. It is an international group—Americans, Taiwanese, Europeans, Japanese—of a single class. Virtually all of them are designers, engineers, or buyers from foreign companies who have come to meet with Chinese factory owners. The Americans in the group tend to be beefier than the Shanghai-Beijing crowd, and more Midwestern-looking. Some wear company shirts or nylon jackets with their company’s logo on the pocket.
That so many people are in motion gives Shenzhen and surrounding areas a rootless, transient quality. The natural language of southern China is Cantonese, but in the factory cities the lingua franca is Mandarin, the language that people from different parts of China are likeliest to share. “I don’t like it here,” a Chinese manager originally from Beijing told me, three years into a work assignment to Shenzhen. “There are no roots or culture.” “For the first few weeks I was here, I thought it was soulless,” Liam Casey says of the town that has been his home for 10 years. “But like any fast-moving place, the activity is the character. It’s like New York. You arrive at the airport and go downtown, and when you get out of that cab, no one knows where you came from. You could have been there one hour, you could have been there 10 years—no one can tell. It’s similar here, which makes it exciting.” Casey told me that, to him, Shanghai felt slow “and made for tourists.” Indeed, I am regularly surprised to find that people stroll rather than stride along the sidewalks of Shanghai: It’s a busy city with slow pedestrians. Or maybe Casey’s outlook is contagious.
Another great flow into Shenzhen and similar cities is of entrepreneurs who have come and set up factories. The point of the Shenzhen liberalizations was less to foster any one industry than to make it easy for businesses in general to get a start.
One is the enormous flow of people, mainly young and unschooled, from China’s farms and villages to Shenzhen and similar cities. Some arrive with a factory job already arranged by relatives or fixers; some come to the cities and then look for work. In the movie version of Balzac and the Little Chinese Seamstress, two teenaged men from the city befriend a young woman in the mountain village where they have been sent for rustication during the Cultural Revolution. One day the young woman unexpectedly leaves. She has gone to “try her luck in a big city,” her grandfather tells them. “She said she wanted a new life.” The new life is in Shenzhen.
Multiplied millions of times, and perhaps lacking the specific drama of the Balzac tale, this is the story of the factory towns. As in the novel, many of the migrants are young women. In the light-manufacturing operations I have seen in the Pearl River Delta and around Shanghai, the workforce is predominantly female. Signing on with a factory essentially means making your job your life. Workers who come to the big coastal factory centers either arrive, like the little seamstress, before they have a spouse or children, or leave their dependents at home with grandparents, aunts, or uncles. At the electronics and household-goods factories, including many I’ve seen, the pay is between 900 and 1,200 RMB per month, or about $115 to $155. In the villages the workers left, a farm family’s cash earnings might be a few thousand RMB per year. Pay is generally lowest, and discipline toughest, at factories owned and managed by Taiwanese or mainland Chinese companies. The gigantic Foxconn (run by its founder, Terry Guo of Taiwan) is known for a militaristic organization and approach. Jobs with Western firms are the cushiest but are also rare, since the big European and American companies buy mainly from local subcontractors. Casey says that monthly pay in some factories he owns is several hundred RMB more than the local average. His goal is to retain workers for longer than the standard few-year stint, allowing them to develop greater skills and a sense of company spirit.
A factory work shift is typically 12 hours, usually with two breaks for meals (subsidized or free), six or seven days per week. Whenever the action lets up—if the assembly line is down for some reason, if a worker has spare time at a meal break—many people place their heads down on the table in front of them and appear to fall asleep instantly. Chinese law says that the standard workweek is 40 hours, so this means a lot of overtime, which is included in the pay rates above. Since their home village may be several days’ travel by train and bus, workers from the hinterland usually go back only once a year. They all go at the same time—during the “Spring Festival,” or Chinese New Year, when ports and factories effectively close for a week or so and the nation’s transport system is choked. “The people here work hard,” an American manager in a U.S.-owned plant told me. “They’re young. They’re quick. There’s none of this ‘I have to go pick up the kids’ nonsense you get in the States.”
At every electronics factory I’ve seen, each person on an assembly line has a bunch of documents posted by her workstation: her photo, name, and employee number, often the instructions she is to follow in both English and Chinese. Often too there’s a visible sign of how well she’s doing. For the production line as a whole there are hourly totals of target and actual production, plus allowable and actual defect levels. At several Taiwanese-owned factories I’ve seen, the indicator of individual performance is a childish outline drawing of a tree with leaves. After each day’s shift one of the tree’s leaves is filled in with a colored marker, either red or green. If the leaf is green, the worker has met her quota and caused no problems. If it’s red, a defect has been traced back to her workstation. One red leaf per month is within tolerance; two is a problem.
As in all previous great waves of industrialization, many people end up staying in town; that’s why Shenzhen has grown so large. But more than was the case during America’s or England’s booms in factory work, many rural people, especially the young women, work for two or three years and then go back to the country with their savings. In their village they open a shop, marry a local man and start a family, buy land, or use their earnings to help the relatives still at home.
Life in the factories is obviously hard, and in the heavy- industry works it is very dangerous. As the foreman of a Taiwanese electronics factory put it to me when I asked him about rough working conditions, “Have you ever seen a Chinese farm?” An American industrial designer who works in China told me about a U.S. academic who toured his factory and was horrified to see young female workers chained to their stations. What she saw was actually the grounding wire that is mandatory in most electronics plants. Each person on the assembly line has a Velcro band around her wrist, which is connected to the worktable to avoid a static- electricity buildup that could destroy computer chips.
That so many people are in motion gives Shenzhen and surrounding areas a rootless, transient quality. The natural language of southern China is Cantonese, but in the factory cities the lingua franca is Mandarin, the language that people from different parts of China are likeliest to share.
Many entrepreneurs attracted by the offer came from Taiwan, whose economy is characterized by small, mainly family-owned firms like those that now abound in southern China. Overall, mainland China’s development model is closer to Taiwan’s than to Japan’s or Korea’s. In all these countries and throughout East Asia, governments use many tools to maximize industrial output: tax policy, trading rules, currency values, and so on. But Japanese and Korean policy has tended to emphasize the welfare of large, national-champion firms—Mitsubishi and Toyota, Lucky Gold Star and Samsung—whereas Taiwan’s exporters have been thousands of small firms, a few of which grew large. China is, of course, vaster than the other countries combined, but its export-oriented companies are small. One reason for the atomization is pervasive mistrust and corruption, plus a shaky rule of law. Even Foxconn, China’s largest exporter, was only No. 206 on last year’s Fortune Global 500 list of the biggest companies in the world. When foreigners have trouble entering the Japanese or Korean markets, it is often because they run up against barriers protecting big, well-known local interests. The problem in China is typically the opposite: Foreigners don’t know where to start or whom to deal with in the chaos of small, indistinguishable firms.
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