How one company’s choice – resignation or the factory – left China’s young workers floored
Weeks after sparking a nationwide outcry over its mass dismissal of recent college graduates, Xingyu – a major automotive lighting maker in eastern China – has severely penalised four of its executives and promised to help the former employees find new jobs. Two of the firm’s top executives received salary deductions and two human resources managers were dismissed or demoted for their…
In August, major automotive lighting manufacturer Xingyu faced a nationwide backlash after forcing 370 recent college graduates to choose between resigning with half a month's salary or switching to factory work. The company, which serves international carmakers like Volkswagen and Mercedes-Benz, has now penalized four executives for their "misjudgment and hasty decision-making".
Xingyu recruited over 400 college graduates last autumn and spring, with 372 officially joining in July. One month into employment, the HR department presented the graduates with the binary choice, which resulted from a workforce optimization plan. Despite apologies from the company and local authorities, the incident sparked a media firestorm, with People's Daily calling it a "blatant trampling of social trust".
Analysts warned that the impact could block the company's Hong Kong listing due to the damage it caused. The youth jobless rate rose to 17.9% in July, up from 14.9% in June, highlighting the challenging job market for fresh graduates. Xingyu's revenue was 6.88 billion yuan in the first half of the year, up 1.87% year-on-year, but profit decreased by 7.78%.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
