The giant iPhone assembly plant in Zhengzhou has cut back on hiring as Apple loses market share in China and Foxconn shifts production overseas. — SCMP
Yukang, a cluster of housing complexes, restaurants and supermarkets on the outskirts of the central Chinese city of Zhengzhou, used to be a bustling hub for China’s migrant workforce.
Its streets were thronged with labour dispatch agents hiring for the nearby super factory run by Foxconn Technologies, which assembles most of the world’s iPhone handsets for American tech giant Apple.
But the neighbourhood was eerily quiet in the days running up to the Lunar New Year in late January. There were few jobs being advertised, and many migrants had left early to return to their hometowns.
The local Foxconn recruitment centre was almost deserted, with only two jobseekers arriving to attend interviews during the Post’s 30-minute visit.
Local agents complained that Foxconn was cutting back on hiring in Zhengzhou and sending jobs overseas, making it harder for them to earn money.
Yukang is a victim of a deep shift taking place in the global supply chain, as Apple loses market share in China and Foxconn shifts production away from China’s export hubs amid an intensifying US-China trade war.
Foxconn’s giant plant in Zhengzhou has long been a backbone of the local economy – and a symbol of the city’s emergence as a manufacturing powerhouse.
Spanning 5.6 million square metres (60.3 million square feet) and employing as many as 300,000 people during peak seasons, the facility – often dubbed “iPhone City” – is the world’s largest assembly hub for Apple handsets.
Since it was set up in 2010, iPhone City alone has accounted for about 80% of Zhengzhou’s foreign trade in value terms, according to a press release from Zhengzhou Airport Economy Zone, the district where the facility is based.
However, the super factory appears to be losing momentum as Apple and Foxconn diversify away from China by ramping up production in India, Vietnam and other countries across South and South-East Asia.
The move is partly being driven by China’s growing trade frictions with the West, which are impacting multinationals in a slew of industries.
In 2023, the number of workers employed by foreign companies in China fell 15%, according to Chinese government data. It was the fastest decline recorded since China began releasing data in 1990.
The Zhengzhou plant has also struggled to recover from the severe disruptions that occurred in late 2022, when thousands of Foxconn workers fled the factory amid fears of an imminent Covid-19 lockdown.
The following year, the volume of smartphone shipments from Henan province, the region where Zhengzhou is located, fell 14.5%, year on year, according to local customs data.
The super factory maintains a large workforce for its regular operations and tends to hire temporary workers during peaks in production, such as ahead of the release of a new series of iPhones.
The exact number of workers employed by Foxconn in Zhengzhou is unclear. Neither Foxconn nor Apple immediately replied to the Post’s emailed requests for comment.
In Yukang, migrant workers appear to be giving up on iPhone City. One local agent, surnamed Han, said she was only hearing from five or six jobseekers a day looking for work at the factory – mostly people who were desperate for money.
When the Post arrived at Han’s office at noon, a loudspeaker set up outside was blaring the message “looking for temporary workers” endlessly on a loop. Han was inside, taking a nap.
“People will return after the holiday, maybe,” the woman said, after being jolted awake.
Many, however, have not come back.
The days after the Lunar New Year holiday are typically a peak season for hiring at Chinese factories, but every labour dispatch agent in Yukang that the Post spoke with said the number of migrants looking for temporary work at iPhone City remained low – even compared with the same period last year.
Several agents made similar comments to the Post throughout 2024, blaming the lack of jobseekers on the fact that the factory had fewer vacancies.
“They did not hire as many people (as before) last year,” said Zhao, another local agent. “I guess that’s because Foxconn has been moving some of its production lines out of China, only returning last year before the latest iPhone was released.”
Although iPhone City had a busy season ahead of the launch of Apple’s iPhone 16 series in August, Henan’s smartphone export volume still fell by 8.7%, year on year, in 2024. The value of those exports was down 13.4%.
Given that smartphone exports account for nearly one-quarter of Henan’s total foreign trade in value terms, the decline in output at iPhone City meant that trade in the province grew by only a modest 1.2% last year.
To make matters worse, Apple has been losing ground in the Chinese market to domestic rivals such as Huawei Technologies. In 2024, the iPhone’s market share in China fell to 15%, down from 19% the previous year, according to research firm Canalys.
Globally, Apple’s market share also dipped slightly to 23% in the fourth quarter of 2024, though it still remains comfortably ahead of its closest competitor, Samsung, at 16%.
According to local media outlet Henan Daily, Foxconn expects production at iPhone City to surge over the coming months due to a Chinese government trade-in programme designed to encourage people to buy new electronic devices, as well as a general recovery in consumers’ willingness to spend.
But on Foxconn’s recruitment platform, the latest job postings on Saturday were offering temporary workers an hourly wage of only 23 yuan (RM14), compared with 28 yuan (RM17) in August. – South China Morning Post
