Chinese Supplier Gets Dumped By Apple For Fraudulently Using Underage Labor

jones_supa writes "Another report from Apple regarding Chinese labor practices surfaces. After conducting its 2011 audits to 339 sites, the company found that cases of underage labor had jumped from 6 to 74 in one year. It was concentrated in a single circuit board manufacturer, which Apple says was willfully conspiring with families to forge age-verification documents. According to a new report, Apple didn't find any cases of underage workers at its final assembly suppliers in 2012, but it plans to continue going deeper into the supply chain to ferret out violators. We are talking about Guangdong Real Faith Pingzhou Electronics Co., with which Apple has now terminated its relationship."

Comments

it's the children that suffer

[Anonymous Coward]

Hooray, instead of working they now can live on the street and starve to death.

Re:it's the children that suffer

[Impy the Impiuos Imp]

Indeed. The choice in places like this isn't slaving away for 22 hours a day in a Dickensian nightmare vs. kicking balls around in a field with butterflies and songbirds.

It's working in a factory vs. living in grinding poverty that makes Appalachian nightmares look like Bill Gates' guest house. The West lifted themselves out of this, now China is.

Imagine someone from the Galactic Federation pulling into orbit in 1850 and hauling out vicious criticism of England. No friend of humanity, that's for sure. If what you care about is actual measurements of well-being, which exploded thanks to factories at that time...vs. grinding poverty, not vs. imaginations of butterflied fields.

Re:it's the children that suffer

[ernest.cunningham]

Read the article idiot!

When new violations are found, Apple requires its suppliers to return the workers back to a school chosen by the family and finance their education. "In addition, the children must continue to receive income matching what they received when they were employed. We also follow up regularly to ensure that the children remain in school and that the suppliers continue to uphold their financial commitment," wrote Apple in its latest report.

Re:it's the children that suffer

[poity]

China is a bit behind, but it isn't in the 1850's. Child labor (defined as employment of people under 16 years of age) is illegal, and there exists compulsory education for children (as best as can be implemented in practice, of course), the same as any modern country* I'm quite certain that Apple and the Chinese government are on the same page with regard to their moral/legal stance on child labor. What bugs me is that there's no mention of the local government taking charge on the issue, and that Apple is tasked with doing what the government should be doing.

*Translate with your preferred service:
http://china.findlaw.cn/laodongfa/zhuanti/tonggong/
http://baike.baidu.com/view/63809.htm

Re:it's the children that suffer

[fuzzyfuzzyfungus]

1. Very few arguments apply 'without limit', and this one certainly doesn't. In broad strokes, it starts to break down once the supply of jobs available(given the narrowed definition of the labor pool) falls below the number of economic entities who need incomes(depending on the prevailing social arrangements, such entities might be individuals, nuclear families, extended families, or other). Exactly what equilibrium point is reached in practice is mostly empirical: child labor, at least outside the family, seems to have few moralists on its side and tends to significantly retard education, so it often gets the chop. Limits on working hours are another means of reducing the labor supply that has achieved broad adoption and popularity.

Restrictions on individuals within the adult population definitely exist; but tend to be carved out by much more idiosyncratic means; formally-illicit-but-common discrimination against certain groups, various professional exams and licenses, that sort of thing. Because they tend to badly fail the 'number of jobs roughly equals number of economic entities' rule, wholesale restrictions typically only achieve support if the group excluded is supposed to be a member of some already employed entity(exclusion of women, say, becomes deeply problematic if single-income families are not the ideal and the norm) or if the exclusion is from a specific profession rather than from the workforce entirely.

2. As with sellers of any other good, sellers of labor who wish to maximize their slice of the pie are striving to hit the optimal compromise between units sold and price per unit: If you simply gave labor away, you'd sure see a lot of new factories; but it wouldn't help you much. If you charge $1,000/hr, you probably won't have a job. Some number of new factories is clearly beneficial to workers; but the returns aren't unbounded: If the additional demand for labor produced by lowering its price doesn't make up for the lower price(and loss of time you could be using for other things) it isn't terribly helpful. Exactly how many factories constitutes a local optimum is, naturally, a messy empirical question.

Re:it's the children that suffer

[AlphaWolf_HK]

There's no "pie" to slice from, unless that pie dynamically shrinks and grows (it's not a zero-sum-game.) If you're a regular slashdot reader, I'm sure your familiar with the concept that a pirated song isn't a lost sale. If somebody didn't want to spend the money to buy it anyways, they still wouldn't have bought it. When you lower the price, you increase demand. In the case of a song, free is a pretty low price. As an anecdote, I recall one time a soda machine was misconfigured to sell sodas for 5 cents, and when people in my class found out, they all went to buy a soda where they wouldn't have otherwise. Anyways, if you accept that principle, then lets carry it over to physical luxury goods (which are what these factories produce, such as iphones.)

These same rules apply to labor, and likewise, decreasing the supply of labor doesn't (typically) result in higher wages when it comes to luxury goods, rather it most often results in lower supply, therefore higher prices, and therefore less demand (remember, people who already didn't want to pay the cheaper price still wouldn't have bought it anyways, and now even fewer people will buy it.) Overall, your revenue declines, and you still have the same number of employees, so you can't raise their wages even if you wanted to (and remember, you have lower demand, so your demand for more workers is also reduced.)

Often times even in short supply, the price won't go up. A real-world example of that is when e.g. the iphone, or the nexus 4 as a more recent example, although there isn't enough supply, they don't raise the prices because the demand will fall (that and it spells bad PR for the company.) And remember, these are Chinese made, so taking the kids out of the workforce again doesn't help wages any.

Now increasing the supply of labor does lower the prices for necessities that people are willing to buy with almost no concern of the price, like petroleum, but China doesn't deal in many of those goods. And if they did raise the price that much, they wouldn't hold their position very long. The reason why is because China holds their position entirely due to how cheap they can make stuff, and if they couldn't make stuff as cheaply, then other countries would compete (and readily so due to the west's general distrust of Chinese goods.) So in any case, you still don't increase the wages.

To add to that, in rural China there isn't much in the way of education.

Re:it's the children that suffer

[AlphaWolf_HK]

Limits on working hours are another means of reducing the labor supply that has achieved broad adoption and popularity.

At initial glance you'd think something like that increases wages and reduces unemployment, but in practice it does neither, and in fact results in the opposite in all cases of implementation. It's pretty easy to see why when you consider a few things:

As I explained in another post, the economy, and even resources in general, aren't a zero-sum-game. There is no "pie". By artificially decreasing the supply in labor, you're also decreasing the supply of goods produced. For necessity goods, this generally results in higher prices and therefore lower demand. In the end, the supplier will probably see the same revenue as they did before, only now there are fewer goods produced. But that's just for that one closed system; it also impacts the economy in other ways.

Due to lower availability of necessity goods, say capital goods like construction equipment, the construction companies will now find that it is harder to get contracts due to higher prices that fewer people can afford. This means that they have to lay off employees. Now that we have increased unemployment, we also have reduced consumer spending, which eventually ripples back around to the original company that made the construction equipment.

Now you might say that since these people work less, surely other people will take over where they stopped working. It doesn't work out that way in practice. I'm sure you've run across your fair share of people who either simply don't want to work, or just downright do their job half-assed. What you're doing is pushing these people into jobs that they otherwise wouldn't take, and likewise your production doesn't increase in the same way it would if the other workers could simply work as many hours as they wanted to.

This is why, for example, after France instituted the 35 hours a week limit, their GDP saw a decline and their unemployment rate increased. It absolutely did not result in what they had planned on.

Re:it's the children that suffer

[Anonymous Coward]

Months ago, when talking about underage workers was all the rage, people were decrying Apple for profiting from child labor. Now that Apple is taking a strong stance against it, they're causing the children to suffer. Right, that's not biased.

Re:it's the children that suffer

[vakuona]

Or it discourages them from employing underage workers.

Re:it's the children that suffer

[node 3]

Hooray, instead of working they now can live on the street and starve to death.

Gotta love Slashdot. Its hatred is for Apple runs so deep, there are many here who would rather children be forced into labor than admit that Apple does something non-evil, or even (dare one say it!) something *good*.

what's "underage"

[rubycodez]

how old were they, if poor teenagers want to help their families by earning some extra coin, better that than being punks in a street gang

They are making a living wage in China

[SuperKendall]

Companies paying a living wage, here and in China.

That's what Apple is doing already.

Apple is the ONLY company to give workers in China bonuses, and to make sure they don't work too much overtime. Workers in China are making less here, yet they are providing not just for themselves but for whole families.

Just how ignorant do you have to be to not understand that a living wage can differ drastically between countries?