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Foxconn Stock Falls on Concerns Over Labor Costs |
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Written by Kathy Nargi-Toth
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Friday, 14 December 2007 |
TAIPEI - Foxconn Group's Hon Hai Precision Industry Co stocks fell sharply, closing at NT$181.5, down 6.9%, to the lowest level since August 2006. The drop comes on the heals of Foxconn's announcement that it will provide permanent contracts to employees with more than eight years of service. The market reaction to the new labors laws that go into effect in China next month are consistent with growing concerns over rising labor costs in the region. According to some analysts, Foxconn's new employment practices could result in a 15% increase in its labor costs in China. Foxconn employs more than 400,000 on the mainland. Foxconn are expanding in Vietnam, a location recognized for lower costs.
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