MCLC: precarious state of creativity in China

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precarious state of creativity in China
Source: Creative Transformations: http://www.creativetransformations.asia/2014/09/the-precarious-state-of-creativity-in-china-today/
The precarious state of creativity in China today
By Michael Keane
In Workingman’s Blues #2, a song released on his 2006 album Modern Times, Bob Dylan writes: ‘They say low wages are a reality … if we want to compete abroad.’ This tune might not be on the playlist of Hollywood executives but it probably encapsulates the mood in tinsel town.
The reality is that rising production costs and intense competition over the past decade have resulted in a great deal of work going abroad. Writing about the bankruptcy of Rhythm n’ Hues, the VFX house responsible for The Life of Pi, Michael Curtin says that Asia is now a global leader. Rhythm and Hues had attempted to remain competitive by offshoring its operations, opening facilities in Canada, Malaysia, and India. However, this strategy only had the effect of increasing operating costs in other ways.
Offshoring refers to the kind of cost-cutting measures whereby work is sent to cheaper locations. Offshoring has played out in other segments of the economy, namely in business process outsourcing and call centres where India has assumed the leading position. Emerging economies continue to achieve substantial growth by providing cheap labour and preferential investment policies in creative sectors such as animation, design, entertainment software, as well as parts of the cinematic value chain.
Meanwhile in academia the notion of ‘precarious labour’ has emerged to describe the way that labour markets are reorganising in many developed economies; for instance an increasing number of jobs are listed as casual without fixed incomes or benefits. Skills learnt in schools and universities lose value in occupations that rely on learning-on-the job. When extended to employment in art, design and media sectors the term becomes ‘precarious creativity’. While it might sounds like an obscure idea for the average person in the street, for the digital effects artists in LA losing their jobs to workers in another country this is a very real concept.
Knowledge capital and job mobility
However, precarious creativity as it is understood by Western scholars in media and cultural industries does not really square with the Chinese reality. While data from the National Bureau of Statistics is not fine-grained in term of occupational categories, it suggests that salaries in ‘culture, sports and entertainment’ occupations are higher than other service industries, not a surprising finding considering the amount of investment, both domestic and foreign, that has taken place over the past several years. In addition the largest increase in salaries is in the category ‘information transmission, computer service and software.’ Discussions of the bonuses paid by domestic technology and games companies like Tencent can be found online. Successful projects can deliver dividends to creators that are often more than monthly salaries.
While the precarious creativity argument doesn’t fit in regard to salaries and job security, the mobility of the workforce, combined with the rising fortunes of a number of Chinese media companies, is adding to the knowledge capital of China’s creative industries, a finding that is supported by Shaun Rein’s study in other business sectors, recently published as The Rise of Copycat China.
Many multinational companies have established operations in China, mostly in animation, software, design, and film production. In most of these environments workers acquire knowledge capital through learning. The foreign business introduces new ways of thinking about design while the locals contribute labour. The chance to work in a foreign company may be prestigious for some; it is also the means of acquiring crucial knowledge capital. But how long the worker stays with a company depends on salary, job satisfaction and career expectations. The inclination to change occupations can be explained in terms of ‘compensating differentials’, that is, the coexistence of monetary and non-monetary elements of employment.
Skills (and knowledge) are transferable and many workers see no need to be loyal to the foreign master when better offers come along. When workers walk out the door actual codified knowledge (such as intellectual property) is lost. In games industries we observe this phenomenon. One of my Masters students who worked in a games industry in China before coming to Australia believes that the transfer of skills to developing countries is the natural order of the world now. In the games industries salaries in R&D have increased the fastest with the greatest demand for workers being in Beijing and Shanghai.
Hollywood’s pain is China’s gain. The relocation of part of Dreamworks operations to Shanghai as a joint venture entity called Oriental Dreamworks signals a strategic move by the US-based company in order to take advantage of the world’s largest media market. For the Chinese, chastened by the reception of Kungfu Panda in their homeland, this is a chance to learn from the best creative minds in the business.
Many people in China view the challenge facing the nation’s film, TV and animation media industries in terms of ‘catching up’ with, and learning from advanced ‘soft power’ nations like the US. In the past few years a rise in collaborative production opportunities in China together with the construction of media production bases has led to significant transfers of knowledge: this includes human capital, customer capital, and structural capital as well as technological know-how. Knowledge capital is a much sought after currency and while overseas players are seen as custodians, a shift of high-end production in particular from East Asia to the Mainland signals that ‘made in China’ is finally turning towards ‘created in China.’
Between the production line and the studio
If film, animation and games are looking for new ways to be original, the fashion industry is unashamedly about imitation. As Ralph Lauren aptly puts it responding to a question to Oprah Winfrey’s question, ‘how do you keep reinventing?’: ‘You copy. Forty-five years of copying. That’s why I’m here.’ In China today fashion and textile manufacture coexist in a symbiotic relationship. Workers toil to produce textiles while the country’s leaders exhort citizens to construct an ‘innovative nation’.
The worker on the Chinese-owned production line in Shaoxing, the centre of the textile industry in Zhejiang Province, however, is unlikely to be concerned with the idea of innovative nation; work is a means to put food on the table, hopefully providing a stable income. This is a sweat industry: long hours, cramped conditions, and low wages. Creativity is redundant.
In many foreign owned design workshops however creative knowledge capital is valued differently. According to Tim Lindgren, an independent designer, who took his production to Shanghai several years ago because costs in Australia had escalated to the point where he could not employ staff: ‘it’s hard to keep high quality staff: they learn on the job and then leave to start their own business or find higher pay’.
While China is taking jobs from developed countries, however, it is a matter of time before technology and competition for human capital begins to complicate the bottom line. Much production of creative services now occurs at no cost through user communities. In addition, the cost of labour is rising; for instance it is no longer cheap to outsource or do business in China. In The End of Cheap China Shaun Rein argued, ‘Instead of the market to produce in, China has become the market to sell into.’ In his forthcoming book called The End of Copycat China Rein argues that the combination of higher prices and a lack of workers are pushing China towards high margins.
The VFX industry reconsidered
The issues facing companies are very real and while large multinationals are able to cover losses, many smaller players are impacted. In our current Australian Research Council project called Willing Collaborators: Negotiating Change in East Asian Media Production we are looking at evolving practices in film collaboration, TV formats, online video and the apps industry as companies move their production to Mainland China.
The VFX industry, which is made up of both large and small ‘houses’ is arguably the best illustration of the challenges and already many South Korean VFX firms have moved into the market, capitalizing on the popular reception of Korean content in China. With no national restriction on post-production, there are an increasing number of international players jockeying for work with Chinese companies. In a study of small and medium-sized VFX and post-production firms in Australia, the UK and Canada QUT academics Rachel Parker and Stephen Cox identified three main ways that companies survived in a competitive market or strived to increase their share of value: these are adaptation, diversification, and mimicking. These strategies are also evident in China.
Adaptation is where firms look to select market segments where they think they can gain a constant supply of work; for many this takes the form of lower budget productions, offering quick solutions that don’t require complete computer graphics (CG). Many post-production houses in China operate this way because the size of the market and the thousands of episodes of TV serial drama produced annually, particular the large spate of historical stories. The dominance of historical stories has resulted in firms specializing in providing actors and extras that can play Japanese military roles.
Diversification is about reducing reliance on one link in the value chain by offering services across a range of projects in film, television and television commercials (TVC). Private TV producers in China, now numbering over four thousand, moonlight as advertising and post-production houses as well as producing commissioned content for state broadcasters. The existence of outsourced production in turn increases the mobility of workers. Ying Zhu writes about how China Central Television (CCTV) began to outsource production in the early 1990s, in the process finding this was a way to attract new ideas and talent. In my own interviews with both traditional broadcasters and private companies, however, it is evident that the challenge for talent is now coming from cashed up new media companies.
The strategy of mimicking occurs when firms reposition themselves to improve their margins by moving into higher-value activities. They seek to move into content production and intellectual property acquisition by co-producing with established companies. In this respect collaboration offers a way forward, as long as the partner relationships are good and everyone is willing to share.
An example is the Melbourne-based Australian post-production house Soundfirm, which has operated a Beijing studio for more than 10 years and which has established a reputation for quality work. Others Australian companies including Animal Logic also work with leading Chinese film directors. Foreign players are able to compete with local companies. Again, this is an area where we see significant transfers of knowledge capital and guanxi (personal network effects), as Brian Yecies has shown with his study ofKorean postproduction companies in China.
Does the term ‘precarious creativity’ make sense in China?
But just how useful is the term ‘precarious creativity’ when talking about China? Of course massive changes in many sectors of the economy are occurring with workers being laid off. And as I’ve mentioned the creative industries are faring better than most sectors of the economy. But there is a dark side. Many aspects of life in China are precarious. Taking a taxi ride in Beijing can be dangerous, even breathing the city air is a risk. It is often dangerous to question authority or circulate critical ideas: one’s employment might be terminated. The European Enlightenment view that creativity is about asking difficult questions, challenging authority and destabilizing norms does not sit well with the government.
The discourse of creativity is based on a harmonious vision of progress, captured in the alluring idea of the inclusive Chinese Dream, one in which all Chinese citizens are presumed to participate. Creativity is considered to be unequivocally good: that is, beautiful works of art provide benefits to society without causing or inciting tension. ‘Precarious creativity’, whether disruptive or job-destroying, is not in the lexicon of policy nor does it appear in academic reports.
In China creativity promises to lift people out of polluting repetition-based industries such as manufacturing and move them into more value-adding service sectors while at the same time revitalizing domestic cultural and content industries, making them internationally successful. It offers what might be termed ‘cultural soft power’ dividends. In the meantime the leakage of knowledge capital from successful soft power nations with international branches in China is helping China’s cause.
This article draws on research currently being conducted in an Australian Reserach Council Discovery project Willing Collaborators: Negotiating Change in East Asian media production DP 140101643
by denton.2 at osu.edu on September 24, 2014
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