New Urban Poor

Migrant factory workers working in a clothing factory

China recently has triumphed to become the world’s second largest economy after three decades of economic reform. With the rise of the emerging middle class and the rich, Chinese people are eager to buy luxury goods.  China will become the world's biggest market for luxury goods in five years, according to a report from the Chinese Academy of Social Sciences. China's luxury goods market had increased to 9.4 billion U.S. dollars by the end of 2009, making up for 27.5 percent of the world's luxury goods market and replacing the United States as the world's second largest luxury goods market.  For instance, I was surprised to learn that Louis Vuitton and Burberry have their designate stores in Changchun, one of the second tier cities in China.  Many economic elites have grown accustomed to a western life style. They have their personal vehicles for daily transportation, take trips abroad, and dine at fancy restaurants, etc. However, the life of an average Chinese citizen is very different from what described above.

Like other developed countries, the rich and middle class only make up part of the Chinese population; many others are living in a life of poverty. A new urban poor has emerged in China. The new urban poverty is mainly composed of rural migrants, unemployed people, laid-off workers, poor workers, and retirees from failing or bankrupted enterprises. They are marginalized under the market transition of the economic system.

Here I am going to share with you some of the stories and scenes I heard and observed while I was in China last December. Associated with the last two decades of economic reform, many of workers from the factories used to be owned by the government lost their jobs. The security they were paid as a buy-out was far less than what is required to maintain a basic life in a long term. A considerable portion of them did not receive a desirable level of education due to the Cultural Revolution. The job opportunities for them are slim in the current competitive job market. Many of them end up with living with their parents for survival. The family of Mr. Lao Zhang, a long time neighbor of my family, is the perfect reflection of the reality. Mr. Lao Zhang has an enviable pension since he retired from a government institution. However, two of his three children have been jobless for years. Now the two children have to live with Mr. Lao Zhang in order to cover their food and shelter. This phenomenon is general in traditional industrial cities, like Changchun.

When we were waiting for our connecting train back to Changchun in Beijing, I saw a few people lying down on the cold, concrete ground in the hallway of the train station. From their appearances and the luggage they were carrying, I could tell that they were rural migrants who might be construction workers or small restaurant waiters waiting for their trains heading back to their countryside homes to reunite with their long-time-no-see parents, children and bring home well needed money. They are the group of people who do not really benefit from China’s explosive economic growth.  

The rural migrants became a large part of the workforce in China’s developing economy.  A lot of large cities suck in migrant workers with the demand for construction of new high-rises. They worked very hard with a low pay. Also, in cities located on the Pearl River Delta, such as Shenzhen and Guangzhou, industrial development attracts lots of young rural migrants. It is typical that the workers in this area were made to work long hours, sometimes in less than desired environment. It may be exaggerated to say that the expanding economy has improved the lives of millions of citizens while simultaneously crushing the dreams of others. However, it does reflect the unfairness in the distribution of the benefits from Chinese economic development.

The article I read for this topic states that the new urban poverty in China, which has been brought up in the market transition and social restructuring period, has had consequential impacts on Chinese socio-economic stability (Liu & Wu, 2006).  Researchers argued that the state is the manipulator of institutions and policies do matter in the creation of new urban poverty, and that the cleavages between the old and new institutions further intensify it (Liu & Wu, 2006. Authors suggest that the Chinese government should aggressively reform the current welfare system and establish a system based on citizenship which will provide basic living support and development rights for the urban poor group. Also, abolishing unjust policies, like the hukou system, and correlated unfair employment policies will let the migrant workers to be treated as regular citizens (Liu & Wu, 2006).

The social inequality has its root in a long standing policy, called hukou, in China. Hukou is a register household system according to a person’s birth place and serves as an “invisible wall” between the urban and rural sectors. It is extremely difficult to transfer one’s rural registration to an urban one.  In general the farmers in the countryside are not protected by the social welfare system. Because of hukou, the massive population of rural migrant workers in China has been excluded from receiving the full benefits, like healthcare and education, despite their remarkable contribution to the society since they remain their “peasant” status. They only can undertake the hard, dangerous and dirty physical, labor-intensive jobs. They do not receive equal employment opportunities and security of life in urban areas. Therefore, many migrant workers have to return to the countryside to retire, raise children or treat illnesses as their limited pensions are not enough to cover the high cost of living in cities.

In recent years, the Chinese government has introduced a series of anti-poverty programs, such as the three-tier social security system. Some programs have already started to have effects, while others are still in the development process.  However, the infrastructure of Chinese cities has developed far too quickly for the development of benefits for urban dwellers. It is the time to tell the government that more changes are needed in order to end the discrimination and the unequal treatment against migrant workers living in cities.

Work Cited:

Liu, Y & Fulong Wu. (2006, April). The State, Institutional Transition and the Creation of New Urban Poverty in China. Social Policy & Administration, 2006 Volume40, Issue 2, P121-137. Retrieved March, 21, 2011from Academic Search Complete Database.

Workers (2010, August). Chinahukoureform.wordpress.com  Retrieved April, 16, 2011 from Google Image, http://chinahukoureform.files.wordpress.com/2010/08/workers1.jpg?w=232&h=300