Competition between giants
Foxconn Technology Group, a key supplier to Apple, is offering higher wages to workers making Huawei Technologies phones at its manufacturing unit in Shenzhen, southern China. This was discovered due to the employment advertisement and information provided by the employment agencies.
Foxconn FIH, which specializes in producing Huawei smartphones and operates under the umbrella of Foxconn International Holdings, offers new employees at the Longhua plant in Shenzhen an hourly wage of 26 yuan (approximately $3.60). This rate is significantly higher than the 21 yuan hourly wage offered to employees of Foxconn’s embedded digital products business group (iDPBG), which is responsible for producing the iPhone.
The FIH division is becoming an increasingly vital player in the manufacturing ecosystem of Huawei and other smartphone companies, primarily focusing on Huawei’s manufacturing requirements. Workers recruited by the FIH division are assigned to different teams based on current demand with a significant likelihood of being involved in the production of Huawei phones.
Foxconn’s move comes in the midst of fierce manufacturing competition between Apple and Huawei, which recently launched new 5G smartphones in the world’s largest smartphone market, China. With the global push towards 5G technology and increasing demand for compatible smartphones, both tech giants are vying to grab a larger share of this lucrative market.
In the past, Foxconn workers were able to earn significant bonuses and higher monthly earnings, especially during peak production seasons. However, according to an internal source at labor services company Foxconn, bonuses may only increase by about 1,000 yuan (about $137) this year due to lower orders and less need for workers.
It is worth noting that Apple is actively diversifying its supply chain to reduce dependence on a single manufacturer and mitigate risks associated with geopolitical tensions. That diversification has led to an overhaul of the pay structure at Foxconn, which remains a vital partner of Apple but is also expanding its work for other prominent tech companies such as Huawei.
Foxconn’s decision to offer higher wages to workers making Huawei phones versus iPhones underscores the competitive landscape of the tech manufacturing industry and the changing dynamics of supply chains in response to market demands and geopolitical considerations. As Apple and Huawei continue to battle for dominance in the 5G smartphone market, this pay gap could have significant implications for the workforce and the industry as a whole.
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