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In FocusHow one company’s choice – resignation or the factory – left China’s young workers floored
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Mandy Zuoin ShanghaiPublished: 12:00pm, 14 Sep 2026Updated: 12:04pm, 14 Sep 2026Weeks 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 “misjudgment and hasty decision-making”, the company said in a lengthy statement detailing its recent “mistake” last week.
The saga began in early August, when the Shanghai-listed company, whose clients include international carmakers such as Volkswagen and Mercedes-Benz, presented more than 370 fresh graduates – who had joined the company a month earlier – with a stark choice.
They could either resign “voluntarily” and receive half a month’s salary, or stay and be reassigned from office-based technical roles to factory-floor work, including tightening screws.
According to the firm, 107 chose the former option. But the uproar that ensued has placed the company firmly in the centre of a media firestorm, with Communist Party news organ People’s Daily calling the move “a blatant trampling of social trust” in a commentary late last month.
The extensive public attention the incident aroused stood as a tangible reflection of corporate workforce contraction, youth employment pressure and growing incidents of labour disputes, phenomena occurring within a broader slowdown in the world’s second-largest economy, analysts said.
While neither the firm nor local authorities specified any violation of labour law by the short-term manoeuvre, which coincided with its application for a listing in Hong Kong, its adverse effects were evident, the analysts warned.
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