“Time is money,efficiency is life”: The transformation of labor relations in China

The past twenty-five years of economic reform have seen the transformation of labor relations in China, with the widespread adoption of capitalist labor practices by firms of all ownership types. This transformation has occurred in the absence of both large-scale privatization and political change, but was part of a gradual yet dynamic liberalization and “opening up” to foreign trade and investment that occurred across both regions and across types of firms. The first half of this paper details this process of dynamic liberalization that has spawned competition and change in labor practices, including marked increases in managerial autonomy and labor flexibility. This explanation goes beyond the regional emphasis to also examine changes across types of ownership; the gradual liberalization of labor policies and convergence with capitalist practices can only be understood as part of a more general trend ofownership expansion, through the introduction of new types of firms, andownership recombination, which is the fusing of the public and non-state sectors through novel forms of organization. The much-needed panacea to this shift to capitalism—a state regulatory and legal regime that is capable of mitigating its excesses and effective organizations to represent labor—is not yet well established. The second half of this paper explores two institutions, the labor contract system and the official trade union organization, to show how labor relations have shifted dramatically toward flexibility, insecurity, and managerial control. The author would like to thank those who offered comments and criticisms, including Mark Frazier, Jaeyoun Won, Bill Hurst, Jacob Eyferth, Elizabeth Remick, Mark Selden, Ruth Collier, and two anonymous reviewers.