It appears the miracle of unionization has not penetrated Chinese labor markets. Contrary to expectations that suicidal workers would be elated at news that the world's second biggest employer in the world (after Wal Mart) with 1.2 million workers, FoxConn, has given employees "landmark concessions" the reality is actually different. Very, very different. "At the Foxconn factory gates, many workers seemed unconvinced that their pay wouldn't be cut along with their hours. For some Chinese factory workers - who make much of their income from long hours of overtime - the idea of less work for the same pay could take getting used to. "We are worried we will have less money to spend. Of course, if we work less overtime, it would mean less money," said Wu, a 23-year-old employee from Hunan province in south China. Foxconn said it will reduce working hours to 49 per week, including overtime. "We are here to work and not to play, so our income is very important," said Chen Yamei, 25, a Foxconn worker from Hunan who said she had worked at the factory for four years." Hold on, Hold on... You mean to say that whatever values are cherished in the good old US of lazy A, such as bathroom, coffee and cigarette breaks, not to mention "democracy", "American Idol", "high cholesterol", $0.99 apps" and "liberated oil" just may not be appropriate to the 95% of other people around the world? But... But... how will America spread its deeply unique "humanitarian" values of globalized freedom and trade interchange (funded by cheap credit of course - those global debt slaves won't enslave themselves on their own - for more see here), and occasionally using kinetic intervention (never war: one needs Congressional approval for that) when said people dare to express a different outlook, and set of values on life? Preposterous. Nay, Inconceivable!
"We have just been told that we can only work a maximum of 36 hours a month of overtime. I tell you, a lot of us are unhappy with this. We think that 60 hours of overtime a month would be reasonable and that 36 hours would be too little," she added. Chen said she now earned a bit over 4,000 yuan a month.
Foxconn is one the biggest employers of China's 153 million rural migrants working outside their hometowns. Compared to smaller, mainland-owned factories, workers said, its vast plants are cleaner and safer, and offer more recreation sites.
But even so, for most employees at the Foxconn plant in Longhua, a part of Guangdong province's vast industrial sprawl, life is dominated by the repetitive routine of the production line.
Outside the Foxconn plant, off-duty employees crowded a small shopping mall. Their tightly packed apartment blocks are hemmed by hair salons, snack stores, gaming arcades and Internet "bars", where many while away leisure hours by playing computer games or watching Korean and Hong Kong soap operas.
"I don't go out that much as there is nothing much to do. I do go out for a meal once in a while," said Huang Hai, a 21-year-old man who said he had worked at Foxconn's factory for about two years.
"This is a good company to work for because the working conditions are better than a lot of other small factories."
But at least some deeply seated, no pun intended, US values are starting to seep through:
"I didn't like my first job at Foxconn because it was very repetitive. It was mainly manual work and I had to hammer nails everyday," said Huang. "Now it's better because I work with computers."
Well, as long as "working with a computer" is a good enough substitute for unionization, AAPL's margin expansion in perpetuity is guaranteed. In the meantime, the fact that Chinese wage parity with the US may come as soon as 2017 should not worry anyone who predicts that Apple will sell over $2 trillion in products over the next decade at flat or improving margins. After all when one has a "story" stock, the facts take a back seat.