From the moment that Deng began to move China towards the market, the character of the Chinese factory began to change. The balance sheet might be improved if the burden of the factory’s social obligations and surplus labour was shed, but how could this be squared with the state’s ideology? In 1979 Deng made a gesture to Marxist theory by announcing that China was not, after all, in the advanced stage of socialism but in the primary stage. Having said this, the way was open for factory workers to be switched from employment arrangements that offered lifetime security to fixed-term contracts with reduced or non-existent welfare provisions. By the early 1990s, the government was talking about bankruptcy and closing unprofitable enterprises.

For China’s factory workers, the shift was cataclysmic. Since 1990, 30 million of them have been laid off from state-owned enterprises with a pay-off of 200 yuan (less than thirty dollars) for every year of service, and no continuing medical insurance or pension. If they wish to stay in their factory housing, they must find the money to buy it. Once a privileged elite, they are now near the bottom of the heap. Their factories, once the centre of their lives, have been stolen from them.