Beijing’s Heavy-Handed Solution to Urbanization

Recent Features

Features | Economy | East Asia

Beijing’s Heavy-Handed Solution to Urbanization

Beijing’s attempts to push out migrant workers will have economic consequences.

Beijing’s Heavy-Handed Solution to Urbanization

Migrant workers pack their belongings onto a truck as they leave from the outskirts of Beijing (Nov. 27, 2017).

Credit: AP Photo/Ng Han Guan

Citing a deadly November 18 fire in one of Beijing’s many shantytowns, city officials are implementing a 40-day cleanup campaign to rid the city of unsafe structures. Most of these serve as homes to the 8.2 million permanent migrant workers living in the capital. The campaign aims to clear 40 million square meters of illegal housing in what will be the biggest facelift since the 2008 Olympics. The force and timing of the campaign, though, is leaving thousands of migrants without homes at the onset of a frigid winter. Universal backlash on social media, from intellectual groups, and international rights organizations came quickly.

While positioned as a way to make the capital safer, these moves are the latest in attempts to rein in unfettered urbanization. Even with measures in place to curb moves to urban centers, improvements in national rail service and transportation are making it easier than ever for millions of migrants to flock to China’s eastern megacities. This drains rural and provincial areas of talent that could contribute to regional development while straining scarce urban infrastructure, social services, and resources. Beijing must now carefully encourage more rural-to-urban white-collar migration while evening out patterns for blue-collar migrant workers. Playing with this delicate balance may have unintended consequences.

Out of Sight; Out of Mind

Migrant workers are an integral, but often unseen, piece of the China narrative. They work in kitchens, behind the walls of construction sites, and under the cover of darkness to produce, build, and deliver the goods China’s growing middle class have come to rely on. Relegated to the outskirts of major cities like Beijing and Shanghai, they operate in a world far removed from that of non-migrant residents. Making an appearance downtown, whether on the back of a three-wheeled truck, collecting recyclables, or out for a meal with friends, is often met with disdain from locals. Migrant workers are neither meant to be seen nor heard.

Although they make up nearly 40 percent of China’s workforce, this otherness is exacerbated by policy and social structures protecting the status quo. China’s household registration system severely limits migrant entitlements, while illegal employment practices and unsafe labor conditions further impede their rights. For workers with families, the situation is even more tenuous. Contrary to the image of children left behind in villages by parents moving to cities, 21 percent of long-distance migrants move as a family unit. Since 2005, there has been a 41 percent increase in the number of migrant children living in China’s urban centers. Unable to access the urban education system, children are typically forced into unlicensed migrant schools. In Beijing, 3.5 percent of migrant children do not go to school at all.

All of this impacts psychosocial well-being. According to The Health and Human Rights Journal, high numbers of urban migrants experienced feelings of helplessness, loneliness, and depression. Bud Pratt, of the You Dao Foundation, said that “today’s migrant population in China is different than any in the past.” In particular, “kids that have grown up in places like Shanghai, and for all intents and purposes are Shanghai people, aren’t offered the same opportunities and are ostracized from local society.” An astonishing 86.3 percent of urban migrant children said they had no local network of friends, with over 20 percent reporting depression. The World Health Organization notes suicide rates among this population are three times the national average.

A Fading Dream

For migrants working in places like Beijing, Shanghai, Shenzhen, and Guangzhou, the gleam of the city is starting to fade. This goes beyond just the gaps in social infrastructure and quality of life. Skyrocketing living costs and a dwindling supply of jobs is increasing the attractiveness of smaller provincial-level cities. The China Labor Bulletin reports migrant wages are often half the overall average in China’s major cities. With China’s economic slowdown, wage increases for the bottom of the pyramid are stagnating. Meanwhile, average rental prices in Beijing sit at 1.2 times average salaries. The Global Cities Business Alliance notes Beijing is the world’s least affordable rental housing market. Migrant jobs are also moving from the higher paying manufacturing sector to the service sector. Since 2011, offerings in the service sector jumped 14 percent. This translates to paychecks that don’t go as far as they used to.

As a response, migrant workers are beginning to leave China’s cities and not return. National statistics show the weakest increase in migrant worker numbers since the Great Recession. While the national government does not track the number of returnees, provinces like Guizhou have seen twice as many today as a decade ago. Beijing’s recent moves are fueling these de-urbanization trends.

A Greater Wall

Thousands of miles away in my own southern California hometown, a similar scenario is playing out. Here, migrant labor from Mexico and Latin America makes up a substantial part of the service economy. Yet for decades lawmakers have toyed with ways to send these populations back across the border. This rhetoric is now entering the national conversation as part of the Trump administration’s stance on illegal immigration. As in China, these often-ostracized elements of society contribute in ways citizens overlook. While many worry illegal immigrants are taking jobs away from hard-working Americans, in reality, these are the jobs no American would likely ever want. Without laborers to fill these roles, entire primary industries risk collapse.

Back across the Pacific, walling migrants off from Beijing may clean things up in the short term. To be clear, the lure of China’s megacities will be a difficult thing to tame. The likelihood of draining an entire city of its unskilled labor, therefore, is not realistic. As in the United States, industry and labor are intimately intertwined. In the case of China’s capital, 21.7 million strong and counting, decoupling this same relationship may have longer-term, negative economic implications extending well beyond just 40 days.

All it takes to understand this point is a glance at three of the modern conveniences supporting China’s middle class.

  • During the first half of the year, China’s online food delivery market swelled by 41.6 percent. Today, 300 million Chinese use mobile applications to have food brought directly to their homes, offices, and even on board high-speed trains. The nearly 3 million delivery people racing through the streets of major cities to meet demand are largely migrant workers.
  • Alibaba’s Single’s Day, the world’s largest shopping event, brought in over $26 billion in sales this past November. Getting billions of little boxes to their intended destinations takes a fleet of over 2 million couriers across a number of different parcel delivery companies. Kuai di, or fast delivery, couriers are as ubiquitous on China’s streets as noodle stands. As with food delivery, these couriers come from unskilled migrant populations.
  • Just across the street from my Shanghai apartment, I’m often woken up by the 24-hour construction on what will soon become one of the city’s tallest buildings. The sleek mega structures housing China’s restaurants and shops would be nothing without throngs of migrant workers toiling day and night to build them. The construction industry employs about 20 percent of China’s migrant worker population. Market estimates point to a continued boom in urban construction, which rebounded in November.

These three industries alone account for nearly 65 million workers across the country. Not all, but the vast majority, are migrants. A realization of Beijing’s cleanup plan would mean the potential collapse of sectors China needs to stay globally dominant – technology, logistics, and urban development. So, we’re not just looking at a little inconvenience to city dwellers. The implications are far-reaching and could negatively impact China’s competitiveness on the world stage.

There’s nothing to envy of the job required by China’s policymakers. While it’s easy to rush to judgment about their approach, the situation is highly nuanced and complex. As in physics, however, for every action there is an equal and opposite reaction. China’s social and private sectors are rushing in to fill the void left by policy. Aid groups are offering lists of jobs and flat mates, while e-commerce giant JD.com is providing temporary housing to its delivery workers. They understand no matter how many cleanup campaigns blow down Beijing’s wide avenues, these “low-end populations,” as they are not so affectionately termed, are a necessity in today’s global society.

John Pabon is the founder of Fulcrum Sustainability Consulting. His previous work includes posts with the United Nations, McKinsey, A.C. Nielsen, and as a consultant with BSR, the world’s largest sustainability-focused business network.