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Written by Wu Di
Editor / Dong Yuqing
In May, Zhengzhou Foxconn was once on a hot search for “grabbing people at high-speed intersections”. As the world’s largest iPhone production base, Foxconn in Zhengzhou Port recently ushered in the “unblocking”. Compared with the summer vacation in previous years, the recruitment season has arrived earlier, the expansion of recruitment is continuing, and Foxconn’s recruitment rebate amount has also continued to rise.
Not long ago, U.S. technology stocks plummeted. Apple’s stock also fell by more than 5% on May 11, and its market value fell from the world’s No. 1 throne. But the iPhone is still very popular in the market, and Apple’s share in the high-end market has reached more than 60%. This allows companies in the Apple industry chain to “drink soup” together.
At Foxconn in the Zhengzhou port area, many employees must pass through the recruitment center every day, and batches of job seekers are brought in by bus. They will be sent to the production line of the iPhone 12, 13 series, and possibly even as reserve workers for the iPhone 14 series. Then, working in two shifts, working “8+2” for ten hours or more every day, to ensure that Apple iPhones can be continuously sent to the world from here.
Foxconn’s Employment Anxiety
More than a week ago, the Foxconn Zhengzhou Airport Factory was “unblocked”.
Previously, due to sporadic outbreaks, the Zhengzhou Airport Plant has implemented a period of “only entry, no entry” closure and control measures. During this period, the related products have not been discontinued.
Yang Xiaomeng, a front-line worker in the factory, told Caijingxia Weekly that after the outbreak, only the related dormitory buildings were closed, and an isolation belt was set up in the factory, leaving only one passage from the dormitory area to the factory area. The control service personnel held a loudspeaker to maintain order.
After the “unblocking” of Foxconn in Zhengzhou port area, there is no isolation belt on the way to and from work. Respondents provided
Yang Xiaomeng has not been home for several months. Although she is a local. “Before, the factory was closed and I couldn’t go back.” However, after the factory was unblocked, “it caught up with the tightening of community epidemic prevention and control policies.”
Zhengzhou is the largest production base where Foxconn manufactures iPhones for Apple. About half of the world’s iPhones come from the Foxconn factory in Zhengzhou every year. In Zhengzhou, Foxconn has three factories, of which the airport factory (also known as Hong Kong Foxconn) is the main factory for assembling Apple’s iPhone.
Based on the hot sales of the iPhone 13 series, the recruitment of the Digital Products Business Group (iDPBG), which is responsible for the assembly of finished iPhone products at Foxconn in Zhengzhou this year, started earlier than before. On February 4th, the fourth day of the first lunar month, before the Spring Festival holiday ended, Zhengzhou Foxconn launched an internal push channel. The launch time is nearly half a month earlier than in 2021.
In order to cope with production peaks, Foxconn has implemented an internal referral and rebate recruitment system. Each employee who pulls one person into the factory and has been on the job for one full month can get an incentive of 500 yuan. New employees will also receive thousands of yuan or even tens of thousands of yuan in rebates after meeting the specific working hours of 90 days and 55 days on the job. The level of rebates often directly reflects Foxconn’s “lack of people”.
On February 4 this year, the initial rebate amount was between 6,800 yuan and 7,500 yuan. But just two days later, the figure was further raised to 8,000 yuan. Yang Xiaomeng joined Foxconn in Hong Kong at the end of February, and has been working continuously for more than a month. Since she moved in, there have been two vacant beds in the 10-person dormitory. The high rebates came ahead of schedule, but there is still a labor gap, which shows that it is not easy to recruit workers this year.
In May after this, Zhengzhou Foxconn was once again on the hot search for “grabbing people at high-speed intersections”. But in fact, the truth is that due to the high demand for labor and the needs of epidemic prevention and control management, the Zhengzhou Foxconn iDPBG Business Group specially arranged a free bus at the connection point of the high-speed toll gate to pick up job seekers to report to Foxconn in the port area. However, this recruitment service operation did not last long, and was soon suspended due to epidemic prevention and control.
However, after the recent unblocking of Foxconn in Hong Kong, Yang Xiaomeng told the “Financial World” weekly that Foxconn’s recruitment work has also resumed quickly. In the recruitment center, which she must go through every day when she goes to work, she often sees batches of new job seekers.
Another Foxconn worker told Caijing Daily that “the rebate fee has reached about 9,500 yuan, and it is normal for thousands of people to enter and exit.” In previous years, only in July and August when Apple rushed to manufacture the next-generation new iPhone, the rebate amount would reach around 10,000 yuan.
A person close to Foxconn confirmed to “Financial World” Weekly that the demand for labor is large and the recruitment will continue to expand. “This year, there are already many orders, and by June, a large number of people will meet the conditions for rebate incentives, and they will leave after taking the money. There is still a large shortage of front-line workers.”
Although Foxconn will provide renewal conditions after the rebate lock-in period expires, most people are still more inclined to “run away with a bucket”. Zeng Kai, who has been in and out of Foxconn many times, told Caijing Daily that regular workers have hard work and low pay. Except for the rebate season, it is not attractive to work at Foxconn. Getting in and out is the norm, and someone he knows has been in and out of Foxconn more than a dozen times.
Not surprisingly, Yang Xiaomeng will get her rebate reward in early June. She had already made up her mind that she would be leaving. “This job is not suitable for long-term work.”
Apple’s order transfer
But in any case, Foxconn ushered in the peak of employment earlier than in previous years.
According to the above-mentioned sources close to Foxconn, the main reason is that factories in many places are facing uncertainty due to the epidemic, and many Apple orders have been transferred to Zhengzhou this year.
In March, the Shenzhen epidemic forced Foxconn to suspend production at its Longhua and Guanlan plants. The shutdown of the two major factories in Shenzhen, another major iPhone manufacturing base, forced Foxconn to urgently make production deployments. As a backup factory, Foxconn in Zhengzhou took over part of the production tasks.
The following month, Apple’s second-largest assembly plant, Pegatron’s Kunshan and Shanghai factories, was also temporarily suspended due to the local epidemic situation. Another Apple foundry that has encountered the same shutdown problem is Wistron.
The above-mentioned person said that although Apple is promoting Foxconn’s overseas layout, such as the Indian factory, the operation and production situation are worse than expected. “India can only be responsible for the assembly of some mid-to-low-end iPhones. The local epidemic and the inefficiency of local workers make it impossible to undertake the production tasks of high-end iPhones such as the iPhone 13 series.” The orders for high-end iPhones are still mainly domestic foundries. Various factors eventually lead to Foxconn’s iPhone production task.
However, Apple’s order transfer has exacerbated the labor shortage at Foxconn in Zhengzhou.
Figure/Visual China
The main model produced in Yang Xiaomeng’s workshop is the iPhone 13 Pro. Her job is to drive screws. Almost after March, she felt that her work intensity had increased significantly. After the outbreak of the epidemic in the factory in April closed individual dormitory buildings, the overtime situation became more and more serious.
Yang Xiaomeng’s workshop has been operating at full capacity for more than a month. Yang Xiaomeng, who has been working night shifts for a week in a row, told Caijingxia Weekly that the usual working hours are 8 hours, but in the past month or so, she has been required to work at least 10 hours a day. Her most recent night shift was from 8 pm to the next day. 7:30 in the morning. At this point, the colleagues on the morning shift the next day have completed their work and took over.
The high-intensity work of continuous rotation was attributed to her as “dry and eat, eat and sleep, and sleep and work”.
According to market reports, in the first quarter of 2022, Huawei, Apple, vivo, OPPO, and Xiaomi are still leading the 5G mobile phone market. Apple’s 5G mobile phone market share ranked second with a 17.4% share. But in the quarter, Apple’s 5G models ranked first in the brand’s new market share with a growth of more than 20%. Among them, among the TOP models with the fastest market share growth, the top five are all iPhones, namely iPhone 13, iPhone 12, iPhone 13 Pro Max, iPhone 13 Pro, and iPhone 12 Pro Max.
Apple has shown absolute dominance on high-end models. Counterpoint data shows that in 2021, Apple’s share of the high-end smartphone market priced above $400 will reach 60%, the highest since 2017.
While the old flagship is sweeping the market, the new iPhone has also entered the trial production stage. According to “Financial World” Weekly, the production of a new generation of iPhones must first pass the ramp-up in production capacity every year. According to Apple’s production cycle in previous years, the production of the next-generation iPhone 14 series also needs to be carried out at least 3-4 months in advance. Behind, July and August will reach the production capacity sprint stage. Yang Xiaomeng heard that the iPhone 14 has already been produced in a workshop. According to market sources, Apple will hold a new product launch in the fall on September 13 this year, releasing a variety of new products such as the iPhone 14, Apple Watch 8, and AirPods Pro 2.
The above-mentioned people close to Foxconn believe that based on Apple’s current production capacity concerns, the stocking of the iPhone 14 series this year can be expected to be advanced by at least two months.
It is expected that the iPhone 14 inventory will also increase on the basis of the previous generation’s 30 million units to deal with sudden supply chain risks.
best season
Foxconn’s production has ushered in the peak season ahead of schedule.
This is fully reflected in Foxconn’s latest performance. In the first quarter of 2022, Foxconn’s parent company, Hon Hai Group, reported its highest first-quarter earnings since 2014.
According to the financial report, Foxconn has hit a new high in 8 years, with a revenue of about 320 billion yuan and a profit of nearly 6.7 billion yuan, a year-on-year increase of 5%, which has exceeded market expectations.
In addition to the hot sale of the iPhone 13 series, the above-mentioned analysts believe that in March and April, large-scale supply chain factories were shut down, resulting in tight supply of many Apple products. “Although Foxconn’s two major factories in Shenzhen were forced to shut down for a week, other competitors were more affected. For example, Pegatron’s factories in Shanghai and Kunshan were shut down for more than two weeks, and some factories even shut down for several weeks.”
Taking the new MacBook Pro as an example, there has been a large shortage of stock since May, and the delivery date has been greatly delayed. According to media reports, nearly half of Apple’s more than 200 domestic suppliers have been affected by the epidemic recently. Recently, Apple announced the discontinuation of the music player iPod. In addition to the sluggishness of the category itself, a large factor is also due to the impact of insufficient supply.
Quanta, the main maker of MacBook products, and Compal, the maker of iPads, suffered a more than 40% month-on-month decline in revenue in April due to the shutdown of the epidemic.
According to monthly operating results, Pegatron, the world’s second largest iPhone assembly plant, had revenue of 115 billion yuan in April, a sharp drop of more than 35% from March and a year-on-year decrease of 19.3%. This is the company’s worst monthly since March 2021. Performance. Pegatron’s iPhone production share is currently second only to Foxconn, and it is also the most direct and powerful competitor for Foxconn’s Apple mobile phone orders.
In the same period, Foxconn’s parent company Hon Hai announced its revenue in April of 486.5 billion yuan (NTD), although it fell by 4.13% month-on-month and 2.8% year-on-year, but the revenue performance was actually the second highest after April 2021. level, still better than the company’s expectations.
An industry analyst told Caijingxia Weekly that compared with competing manufacturers, Foxconn has been limited by the impact of the epidemic because of its huge layout, with more than 40 parks in the mainland, and the layout of multiple production locations shares the risks. “Don’t put your eggs in the same basket” has enhanced Foxconn’s risk response capabilities today.
With the increase in work intensity and the increase in labor demand, Foxconn’s recruitment incentives have gradually increased.
Figure/Visual China
In many Foxconn factories, the benefits of dispatch workers have risen to varying degrees. The monthly salary plus subsidies for dispatched workers at a Foxconn factory in the southwest has exceeded 5,000 yuan. Foxconn employees in the region told Caijingxia Weekly that the longer the entry time, the more corresponding gradient rewards will be given, and a direct reward of 1,500 yuan will be given for more than 150 days.
The rapid changes in the market have made Zeng Kai, who entered the Foxconn assembly line in Zhengzhou port area for the first time, feel more and more unfair. In March, when he first entered Foxconn, the rebate he signed was only more than 8,000 yuan. In the past two months, he has watched this figure gradually increase from 8,000 yuan to 8,500 yuan, and the highest is about 9,500 yuan.
“You do the most work, and you may get the least when you leave the factory in the end.” He felt that he had suffered a loss when he joined the job early. “The highest (rebate) can reach 13,000 yuan.”
By the time she leaves the factory next month, the rebate Yang Xiaomeng can get may only be less than 8,000 yuan. During the lockdown management period, whenever I lay in bed and rested, I always wanted to “run away” from this place. “I’ve persisted for so long, and I can’t get the rebate if I leave early, so I’ve been busy working for nothing.” It was the placebo she gave herself.
Three months of hard work in exchange for tens of thousands of yuan in remuneration. For these Foxconn workers, it will always be a good medicine for psychological massage.
“Foxconn is the kind of place. I want to leave when I come, but I may still come back next year if there is a refund fee.” Yang Xiaomeng told Caijingxia Weekly.
Workers have come and gone, but Foxconn has continued to function as usual. “Foxconn’s significance to Apple will be further enhanced.” A mobile phone industry source told Caijing Daily that Foxconn played a key role in helping Apple resolve the production capacity crisis, and it also handed over the best performance report card.
The person said that the ability to deploy on the spot under the production capacity crisis further demonstrated the irreplaceability of Foxconn for a long period of time.
(The interviewee in the article is a pseudonym)