Ruse in Toyland: Chinese Workers' Hidden Woe

By Joseph Kahn, The New York Times, 7 December 2003

SHENZHEN, China—Workers at Kin Ki Industrial, a leading Chinese toy maker, make a decent salary, rarely work nights or weekends and often hang out along the street, play Ping-Pong and watch TV.

They all have work contracts, pensions and medical benefits. The factory canteen offers tasty food. The dormitories are comfortable.

These are the official working conditions at Kin Ki as they are described on paper—crib sheets—handed to workers just before inspections.

Those occur when big American clients, like the Ohio company that uses Kin Ki to produce the iconic toy Etch A Sketch, visit to make sure that the factory has good labor standards.

Real-world Kin Ki employees, mostly teenage migrants from internal provinces, say they work many more hours and earn about 40 percent less than the company claims. They sleep head-to-toe in tiny rooms. They staged two strikes recently demanding they get paid closer to the legal minimum wage.

Most do not have pensions, medical insurance or work contracts. The company's crib sheet recommends if inspectors press to see such documents, workers should intentionally waste time and then say they can't find them, according to company memos provided to The New York Times by employees.

After first saying that Kin Ki strictly abides by all Chinese labor laws, Johnson Tao, a senior executive with the privately owned company, acknowledged that Kin Ki's wages and benefits fell short of legal levels and vowed to address the issue soon.

He said that the memos might have reflected attempts by factory managers to deceive inspectors, but that such behavior did not have the support of senior management.

William C. Killgallon, the chief executive of Ohio Art Company, the owner of Etch A Sketch, said that he considered Kin Ki executives honest and that he had no knowledge of labor problems there. But he said he intended to visit China soon to make sure they understand what we expect.

Etch A Sketch is the same child's drawing toy today that it was in 1960, when Ohio Art first produced it in Bryan, Ohio. But efforts to keep its selling price below $10 on shelves at Wal-Mart and Toys R Us forced the company to move production to China three years ago.

Today the same toy is made not just for lower wages, but also under significantly harsher working conditions. Kin Ki's workers, in fact, are struggling to obtain rights that their American predecessors at Ohio Art won early in the last century, though the workers are without the aid of independent unions, which remain illegal in China.

China now makes 80 percent of the toys sold in America, according to United States government figures, and no industry here has come under greater pressure to adhere to global labor codes. Kin Ki and most other big producers open their doors to foreign inspectors to assuage concerns that products used to entertain children in rich countries are not made under oppressive conditions in poor ones.

But that goal conflicts with price pressures in commodity industries like toys, where manufacturers command no premium for good labor practices. China alone has 8,000 toy makers competing fiercely for contracts by shaving pennies off production costs.

Kin Ki stays competitive, workers say, by paying them 24 cents an hour in Shenzhen, where the legal minimum wage is 33 cents. When the Etch A Sketch line shut down in Ohio just after the Christmas rush in 2000, wages for the unionized work force there had reached $9 an hour.

Chinese workers say the company also denies them legally required nonsalary benefits and compels them to work 84 hours a week, far more than the legal maximum, without required overtime pay.

I keep this job because my parents and my daughter depend on the money I earn, said one migrant worker, who if named could lose her position for talking about the company. No one likes to work in these conditions, but I have no choice.

Etch A Sketch has had rare longevity in the toy world. Baby Boomers used them as children and now buy them for their own families by the millions.