Chinese firms are often accused of underpaying workers, but a new study in Angola and Ethiopia suggests they don't
As Chinese companies have become active in sub-Saharan Africa, particularly in the building of infrastructure projects, they’ve earned a reputation for paying their local workers badly in comparison to their Chinese colleagues. But the authors of a new study have found that the reputation is undeserved, at least in Ethiopia and Angola, where the study was conducted.
Carlos Oya from London’s School of Oriental and African Studies (SOAS) and and Florian Schaefer from Kings College London conducted interviews with more than 1,400 workers in the two countries to discover whether it was true that Chinese firms consistently underpaid local workers—and what that even meant. “The most cited—and most widely discussed—literature on working conditions in Chinese firms in Africa tends to emphasise poor and often ‘worse’ working conditions, even when it is not clear what the comparator is, whether ‘average’ conditions in the host country or comparable foreign firms,” Oya and Schaefer wrote.
Many past studies, they wrote, have been based on too-few examples (such as a 2011 Human Rights Watch report on two Chinese mining companies operating in Zambia), or focused on working conditions rather than wages. While working conditions are important, and bad practices at individual firms should be called out, the study authors decided to try and settle the pay question specifically.
Oya and Schaefer surveyed workers in manufacturing and construction at Chinese-owned and other foreign-owned firms in both Angola and Ethiopia, as well as at locally owned businesses in both countries. They asked not only what workers were paid, but also about their skills, education, role, and other personal details that might affect pay.
The authors found that pay across the two countries displayed substantial variation. They did find “slightly lower wages in Chinese companies in some segments,” they wrote: for example, among semi-skilled construction workers in Angola and semi-skilled manufacturing workers in Ethiopia. But the study concluded that much of that difference could be accounted for by specific differences in factors like workers’ education or skills. There is “no clear evidence that Chinese firms consistently pay less than comparator firms within same sector and countries,” they wrote in the study, published in the journal World Development.
The study certainly doesn’t absolve Chinese firms of any wrongdoing in sub-Saharan Africa, and only deals with pay in two countries. But it’s an indication that the narrative about Chinese firms exploiting locals might be more complicated than many assume.
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