Paper short abstract:

In this paper, I argue that financializing welfare harms Chinese migrant factory workers and their families because the state and the financial market co-create a system that extracts value from people speculating with their future income while they demand protection against uncertainties.

Paper long abstract:

For the past three decades, the Chinese government has been promoting welfare policies with which financial products and services can integrate. People are encouraged to participate in social protection schemes such as the pension insurance in combination with commercial choices and utilizing the Housing Provident Fund together with reduced-interest mortgages. The state claims that broadening access to financial instruments helps people meet their diverse needs and incorporate those who are marginalized into the market provision of care. Although this logic dominates China's social policy design and implementation, a growing body of literature critiques the practices of financializing welfare. Yet how the precarious, who are most in need of labor protection, become involved in this process remains under researched. My paper therefore contributes to the current debate by detailing how migrant factory workers and their families engage with life insurance policies and home loans vis-à-vis the existing social safety nets. Based on ten-month extensive participant observation in Central China where a prominent electronic factory locates as well as semi-structured interviews with migrant households, I demonstrate that the state-led process of financialization supported by welfare policies re-embeds the vulnerable into the risky market. I argue that this is because of 1) the alignment of the state and the market's interests of keeping workers in a system that extracts value from people speculating with their future income; and 2) the underlying contradiction where the financial market gains from future uncertainties while workers and their families demand protection against them.