China expects McDonald's, KFC to allow unions
When a Chinese newspaper reported that fast food chains such as McDonald's and Kentucky Fried Chicken were underpaying their part-time workers by 40 percent or about $1 an hour below minimum wage, an investigation was launched. Currently, China does not permit workers to organize independently, instead, the workers are required to organize under the All-China Federation of Trade Unions, or ACFTU for short. Until recently, the ACFTU has resisted allowing labor organizing; however, the ACFTU is now lobbying for unions in China.
With an implementation of more unions in China, fast food chains will, as a result, increase their wage rate. Also, with unions becoming more common, the union wage differential will increase which will help the union workers obtain a more fair wage rate. But a problem then arises. If the employers cannot afford the pay increase the unions will demand, how will they offset the pay raise? Will less people be employed as a result?
3 comments:
In my opinion, there will be less people be emplyed as a result of the pay raise. The only way the emplyers can offset the effect is to employ less part time workers and "saturate" more from his employees. Same thing happens here in Marietta College. I have been trying to find a job on campus for a long time, but no one will hire me because of the raised minimum wage. Even at physcial plant, which probably pays the less, you will not find a job because they can afford to pay you. Therefore, any regulation that is "man-made" will disoriented the market.
I do believe that there would be some decline in the number of employed in the country as a result of unionizing. It seems as though unions wouldn't be the answer to the labor issues in China - in the United States, unions are responsible for creating artificially high wages in some markets, costing employers large amounts of extra spending due to increased fringe benefits having to be paid out, and overall lowering the level of employment in industries where unions persist. My concern would be more about how the costs are passed along to the consumer. I think there would be a combination of labor cuts and rises in prices for goods being sold - which could hurt the booming economic growth of the country in the end.
In my opinion this will hurt the employment of many jobs, I doubt the costs will be passed to the consumer. These fast food changes will not raise there prices because they will lose the consumer.The whole point of fast food is that it is cheap. It will hurt the employees they will lose their jobs because these places A. dont want to increase their wage rate and B. dont want to pay them their demanding price. Their better off hiring a few full time people instead of alot of part time people.
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