In China, workplace deaths a small cost

Tens of thousands of Chinese workers are killed in workplace accidents each year because the communist nation relies on local authorities to enforce national safety guidelines, which companies and local governments routinely ignore for the sake of production.

“They’ve been very casual toward life,” said Richard Cooper, an international economics professor at Harvard University, noting that Chinese workers can always be replaced. “To [the businesses], life is cheap.”

For instance, 5,000 of China’s 5 million coal miners are killed on the job each year, a death rate of one in 1,000 on average. By comparison, an average of nine of the 83,000 miners in the U.S. die each year, a death rate of one in 10,000.

Chinese construction sites and factories also have high numbers of fatal accidents, such as the explosion in Nanjing last week that killed at least 13 workers.

As China prepares to overtake the United States as the world’s top manufacturer, the safety conditions of its 600 million-strong work force could give a short-term competitive edge over the U.S. and other developed economies.

“It’s a labor cost borne by the workers,” said Steven Lewis, a research fellow at the James A. Baker III Institute for Public Policy at Rice University.

Mr. Lewis noted, though, that the competitive advantage is slight, given China’s low wages.

The exact number of annual work-related deaths in China is unknown, as even Beijing acknowledges that “it is much more cost-effective for coal mine owners to buy-off the families … than risk closure by reporting an accident,” leaving many deaths overlooked, according to a report by China Labor Bulletin, a group that promotes workers’ rights.

The problem does not lie with China’s safety regulations, analysts say. In fact, the communist nation has some strong workplace-safety laws, especially for a developing economy.

“Chinese government attaches great importance to the protection of legitimate rights of workers,” Yang Wenxu, a spokesman for the Chinese Embassy in Washington, said in an e-mail. Beijing “has made great efforts, including formulating relevant rules and regulations, as well as taking concrete measures, to implement labor-protection laws.”

“There are some good laws on the books, but implementation has been spotty and haphazard at best,” said Phelim Kine, an Asia researcher with Human Rights Watch in New York.

William Nee, a spokesman for China Labor Bulletin, said China does not have enough labor inspectors, leaving many aspects of worker safety largely unchecked.

“[The government] can’t be sure its policies are being implemented,” he said.

Obviously, it is cheaper for companies to ignore regulations and businesses to make decisions based on profit and productivity, Mr. Nee added.

Responsibility for enforcing labor laws falls to the Ministry of Human Resources and Social Security, which has local bureaus across China. It is the equivalent of the U.S. Labor Department.

But with the ministry’s local bureaus severely understaffed, such laws become nearly impossible to enforce, Mr. Kine said. Local governments usually have to fill in, but this opens the door for collusion, he said.

“Labor regulations are often seen as costly frills,” Mr. Kine said, adding that businesses and local governments have no incentive to enforce them.

The economy in China is decentralized, he explained, so each local government needs to attract investment to its area, usually by enforcing fewer regulations.

“What you have is a system that emphasizes production,” Mr. Kine said. “What this creates in most localities is big companies with strong relationships with local governments, which can then ride roughshod over safety regulations.”

Harvard’s Mr. Cooper said the local governments’ attitudes reflect an ancient Chinese adage: “The emperor is very powerful, but he is very far away.”

Last week in Nanjing, construction workers dismantling an abandoned plastics factory accidentally damaged a gas line and set off an explosion so massive that locals mistook it for an earthquake. The blast destroyed nearby buildings and left 13 dead and 300 injured.

Even Chinese officials said the accident resulted from lax safety standards during the operation and detained the responsible officials, according to Chinese media.

Compensation for injuries or death also remains minimal. According to a 2008 report by the Congressional-Executive Commission on China, a human rights watchdog, “central government directives encourage local governments to pressure bereaved families into signing compensation agreements,” which is cheaper than going to court.

Mr. Nee provided an example. China Labor Bulletin recently spoke with a worker who got a finger caught in some equipment and was sent to a hospital. It was cheaper for the company to compensate the unconscious worker for a lost hand than to surgically repair his finger.

When the worker woke up in the hospital, his hand was gone, Mr. Nee said.

China has no independent unions, so workers are “essentially helpless to have a voice,” Mr. Kine said.

The All-China Federation of Trade Unions, the country’s sole trade union, sides with the state and employers in most cases, he said.

Mr. Nee said workers can “vote with their feet” and move to better workplaces, but job opportunities are limited, especially in rural areas.

Analysts have noticed some improvement in recent years. The Congressional-Executive Commission on China noted the strength of labor laws put into effect in 2008, including some that used input from U.S. laws.

Mr. Kine also said there is “hope for change” with the new generation.

“They are more aware of their legal rights and more vocal in asserting them,” he said, which means companies will have to be more attentive to workplace conditions in the future.