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CHINA: At Nike Plant, no Sweatshop, Plenty of Sweat

by Richard ReadThe Oregonian
June 27th, 2005

DONGGUAN, China -- More than 4,000 workers who churn out athletic bags in a huge Nike contract factory here breathe ventilated air. They wear earplugs when pounding rivets. They use bathrooms with running water. And they read their rights on wall-mounted bulletins.

Gone are the acrid fumes, the scant protective gear and the foul restrooms evident during past years in plants making Nike products. Workers flocking from poor villages to booming, smog-choked southeast China express eagerness for their jobs here, belying the image of sweatshop exploitation that has plagued the Beaverton-based company for years.

Yet the Golden Prene factory, which makes about 25,000 bags a day and generates $80 million in annual revenues, is hardly a carefree place. Assembly workers toil long hours at repetitive jobs. Many of them endure separation from families. Their wages are higher than incomes back on the farm, but meager by U.S. standards at an average of $5 a day, including overtime. Workers' modest dreams reveal difficult lives.

"My mother is raising our 3-year-old son back home," says Kuang Wangxin, a 27-year-old floor supervisor. Twice a year, Kuang rides a bus eight hours with his wife, an assembly worker, to see their child. "I hope when he grows up he can start as a manager," Kuang says, "and not go through what I did."

After Nike's recent disclosure of the names and locations of 705 independent contract factories in its network, a plant visit reveals significant improvements since the 1990s. The main issue to surface is one that Nike managers acknowledge as a widespread problem: overtime hours exceeding maximums set by Nike and local laws.

A few hours in one factory is not enough time to thoroughly assess working conditions, and the Golden Prene factory may or may not be representative. Nike still does not release audit scores for individual plants.

A Nike manager hosting the visit substituted Golden Prene for Bonny Sports, another Chinese factory requested from the disclosure list. He said Bonny made products for Bauer Nike Hockey, a subsidiary not yet fully covered by Nike's compliance standards.

At Golden Prene, randomly selected workers voiced few complaints during interviews with and without a Nike manager present. But fundamental issues of fairness linger from the days when activists dragged Nike into the headlines, contrasting factory workers' wages with rising sneaker prices and lavish endorsement contracts.

Nike public-relations officers once bristled at suggestions that their company, dedicated to lofty goals of athletics and achievement, would exploit workers who, in their view, were gaining economic opportunities. But today Caitlin Morris, Nike compliance integration and collaboration director, sticks to a positive message.

"The obligation that Nike has is to make good on the concept that foreign investment in these countries does raise standards of living," Morris says. "My aspiration as someone in Nike's corporate-responsibility department is to make a positive contribution to that."

Longtime critics acknowledge progress made by Nike managers, adding that it occurred only due to public pressure. "What they've eliminated is super exploitation, and now they're just down to plain exploitation," says Medea Benjamin, founding director of Global Exchange, a San Francisco human rights organization.

Benjamin says Nike, which reported record profits last year, could afford better wages for its contract workers. She says the company should shun China and other nations that ban unions; Nike managers maintain they can do more to support freedom of association by engaging with China.

Jeff Ballinger, director of Press for Change, a tiny but vocal activist organization in Toronto, says Nike executives should empower workers instead of imposing conveniently crafted initiatives. "They're skating by with some corporate social-responsibility template that's been hammered out by expensive consultants," Ballinger says.

Ballinger and Benjamin grant that consumer outrage has waned. Instead of actively targeting Nike, Global Exchange is pushing U.S. city governments to buy "sweatshop-free" products.

Contract payroll increases

Nike's contract work force, meanwhile, has grown to 653,000 in more than 50 countries. One of those workers, Lu Ling, a 26-year-old Golden Prene stitching operator, left her distant rural village eight years ago. She works a standard 60-hour six-day week.

As the eldest child, the middle-school dropout sends money home from her $145 monthly earnings so that her siblings can attend school. Hunched over a sewing machine, she races to exceed hourly production targets so her team can earn more. "Someday," Lu says, "I want to have my own bag factory."

Lu and other workers are so pressed that they don't glance up when visitors come by. They receive health benefits required by Chinese law. They earn enough to buy bicycles -- some workers buy motor scooters -- but not cars.

The Golden Prene factory, owned by the Guang Der Corp., comprises four hulking manufacturing buildings. The 15-year-old complex is located in the gritty Hua Nan Industrial Zone, one of the many huge new manufacturing districts that sprawl across a mainland Chinese region near Hong Kong.

Factory manager Charles Shang, a former Taiwanese army major who served in a military boot-making plant, says the decision to begin making Nike goods about seven years ago forced changes. Before then, he says, employees worked from 7:30 a.m. until 11 p.m. with two one-hour breaks -- every day of the month.

In those days, about 30 percent of the workers failed to return after Chinese New Year holidays. But now, Shang says, annual turnover is under 10 percent.

Nike accounts for between 55 percent and 65 percent of the plant's production. The factory also makes bags for Dakine Hawaii Inc., the Hood River sports-accessory company, and for other brands. Adidas moved out several months ago.

Golden Prene has followed Nike's transition away from oil-based solvents and other hazardous chemicals to water-based materials. Plant managers have grown accustomed to Nike audits, which Shang credits with helping attract customers.

"After they heard we were doing business with Nike," Shang says, "they understood we were qualified."

About 30 Nike employees work in offices inside the Golden Prene plant, with responsibilities ranging from conducting audits to readying Beaverton-designed products for manufacture.

Government, family connections

Golden Prene and other Guangdong-province manufacturers have faced a tightening labor market recently, as workers favor other industrial regions. Instead of raising wages, as some factories have done, the plant works through rural provincial officials, who steer workers its way.

Village and family connections also help. Wan Tianyan, a 21-year-old riveter who projects a macho air, followed his two older sisters to the plant from the family rice paddy. He's saving $97 a month so that he can get married by 25 and give his parents what they want most: a grandson.

"It's not easy here," Wan says.

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