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Skill Acquisition among Garment Workers: Organizational Profit Strategy and Contingent Utilization of Co-ethnic Network

Tue, August 25, 10:30 to 11:30am, TBA

Abstract

Immigrant workers in low-wage labor markets tend to have better opportunities of skill acquisition in some ethnic enclaves. Existing explanations attribute this “enclave effect” to co-ethnic networks. This paper argues that the utilization and thus value of co-ethnic network is contingent on specific organizational profit strategy and incentive structure. This study compares garment factories in a Chinese migrant enclave with a nearby non-enclave factory district in the Pearl River Delta (PRD) area. This design replicates the comparative framework of most North American cases with one major difference: there is no barrier between the enclave and the secondary sector. The non-barrier condition ensures that both sectors could utilize ethnic network in hiring and training practices. In the secondary sector factory, managers employs a profit strategy of maximizing economy of scale. Workers tend to connect with their co-ethnics; while top managers on one hand use co-ethnic networks for recruitment, on the other hand they intentionally handicapped co-ethnic teams in workplace to lower turnover rate and accomplish economy of scale. In the enclave, the profit strategy is to capitalize on team efficiency. Workers’ and employers’ interests were in line to cultivate and utilize ethnic network in hiring, training and team building.

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