Feeds

Foxconn pay hikes 'driving tech titans into Philippines'

China's wage bump is a boon, says Manila's top trade wonk

Choosing a cloud hosting partner with confidence

More signs have emerged that China’s rising labour costs are driving electronics firms out of the country: Philippine officials claim that foreign biz barons are looking to relocate to the small south-east Asian nation.

Philippine trade secretary Gregory Domingo reported “very strong interest” from Japanese electronics, ship building and steel companies, and more investor fact-finding missions from foreign firms than ever before, according to news wire AP.

To an extent, Domingo is doing what all trade secretaries do, hyping up the opportunities for investors in his own country, but there is no doubt that China is being increasingly squeezed.

The People’s Republic has for some time now attracted major investment from the likes of Apple contract manufacturer Foxconn thanks to low production and labour costs, but things are beginning to change.

The country’s five-year plan, ending in 2015, mandates that minimum wage increases should top 13 per cent on average each year and in Shenzhen, where Foxconn has its main plant, the local government has already forced pay up by nearly 16 per cent to 1,500 yuan (£150) per month.

On a nationwide basis, average minimum wage rises topped 20 per cent over the past two years, according to the Financial Times.

Granted, 20 per cent of not very much is still not very much, although that has never bothered shareholders and board members of large tech companies.

In fact, HP and Dell both warned last month that prices at the till may have to rise as a result of Foxconn increasing its workers’ pay packets by up to 25 per cent, with salaries starting at 1,800 yuan (£181) per month.

Campaigners, most notably the non-profit Students and Scholars Against Corporate Misbehaviour (SACOM), have argued that the wage hikes at Foxconn and generally across China still don’t go far enough, and that working conditions generally are not up to scratch.

However, the depressing fact is that unless there is a consumer backlash a la Apple, technology companies are always likely to shop around for the cheapest sources of production, and don’t much care whether that’s Shenzhen or Manila. ®

Remote control for virtualized desktops

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
UK.gov pushes for SWIFT ACTION against nuisance calls, threatens £500k fines
DCMS seeks lowering of legal threshold to fight rogue firms
Just don't blame Bono! Apple iTunes music sales PLUMMET
Cupertino revenue hit by cheapo downloads, says report
Hungary's internet tax cannot be allowed to set a precedent, says EC
More protests planned against giga-tariff for Tuesday evening
US court SHUTS DOWN 'scammers posing as Microsoft, Facebook support staff'
Netizens allegedly duped into paying for bogus tech advice
ISPs handbagged: BLOCK knock-off sites, rules beak
Historic trademark victory, but sunset clause applies to future blocks
prev story

Whitepapers

Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
How to simplify SSL certificate management
Simple steps to take control of SSL certificates across the enterprise, and recommendations centralizing certificate management throughout their lifecycle.