Pay Disparity: Foxconn pays Huawei production staff much more than iPhone workers

Foxconn Technology Group, a major supplier for Apple, is reportedly offering higher wages to workers producing Huawei Technologies’ smartphones in the tech hub of Shenzhen, southern China, compared to those manufacturing iPhones.

The FIH unit, primarily focused on assembling handsets and consumer electronics for Huawei and other smartphone companies, now predominantly serves Huawei, as reported by the local newspaper China Business News.

Apple production staff is getting paid less than Huawei
According to recruitment posts and information from labour agencies, Foxconn’s FIH unit, responsible for producing Huawei smartphones, is offering an hourly wage of 26 yuan (approximately $3.60) to new workers at its Shenzhen factory. This wage is higher than the 21 yuan hourly rate offered by Foxconn’s integrated Digital Product Business Group (iDPBG), which manufactures iPhones.

Workers hired by Foxconn may be assigned to different teams based on current demand, but in recent times, there is a higher likelihood of them being involved in the production of Huawei devices.

The increased hiring activity is occurring amidst a competitive race in production, with both Apple and Huawei recently unveiling new 5G smartphones in the world’s largest smartphone market.

Is Huawei riding on nationalistic pride?
Apple introduced its iPhone 15 series earlier this week, with the official launch set for September 22. The reception for the iPhone 15 has been mixed among Chinese users. Meanwhile, Huawei, despite being blacklisted by the US government, has been generating significant patriotic enthusiasm for its new Mate 60 Pro and Mate 60 Pro+ smartphones, thanks to their advanced made-in-China chips.

There are several factors influencing the varying hourly rates within different units under Foxconn, the world’s largest electronics contract manufacturer.

According to Xu, the recruitment agent, the hourly rates offered by the FIH unit tend to be higher than those at iDPBG because the iPhone production unit typically provides better welfare programs for its workers compared to other units.

In Zhengzhou, the capital of central Henan province and home to the world’s largest iPhone factory, Foxconn is offering peak season signing bonuses of 6,480 yuan per person at the Product Enclosure Business Group, responsible for producing mechanical parts for the iPhone, as indicated in a recent job posting.

While China remains Apple’s most crucial production centre, the company has been diversifying its supply chain due to escalating geopolitical tensions.

Is Apple’s India push being punished?
According to reports citing anonymous sources, Apple has made India-built iPhone 15s available for global sales on the debut day for the first time. Although Apple started iPhone 15’s production at Foxconn’s Indian factory last month, the majority of the latest iPhone 15 series will still be manufactured in China.

Apple is currently facing one of its most challenging sales seasons in China, partly due to the resurgence of Huawei in the smartphone market and the Chinese government’s restrictions on iPhones.

Huawei, headquartered in Shenzhen, has scheduled a product launch event for September 25, leading to speculation about the unveiling of the mysterious chip inside the Mate 60 Pro. The company has raised its smartphone shipment target for the second half of 2023 by 20 per cent, driven by strong presales of the Mate 60 Pro, according to a report from the Chinese newspaper Securities Daily.