Contract labor system

DEFINITION: System used by American industry to attract Asian immigrants

SIGNIFICANCE: During the mid-nineteenth century, a labor shortage in the western United States (US) led to the creation of a contract labor system to help the mining and railroad industries attract cheap immigrant labor to the US. Using labor contracts that paid below-market wages, American industries attracted thousands of Chinese immigrants, angering some Americans who feared immigrant competition and eventually prompting federal legislation to outlaw foreign contract labor.

The California gold rush that started in 1849 saw the first influx of Chinese and other Asian immigrants into the state. A shortage of American labor forced mining companies to seek out immigrant workers. Chinese immigration to the Western Hemisphere had begun long before California’s gold rush. Spanish emigration companies had recruited cheap Asian labor to work in Peruvian silver mines and Cuban plantations. During the US Civil War (1861-1865), the Lincoln administration pushed through the 1864 Act to Encourage Immigration, establishing the US Emigration Office. That office worked with the American Emigrant Company. This private organization focused on European immigration to respond to the shortage of workers created by the drafting of some one million American men into the Union Army. The law was repealed in 1868, but by then, a mechanism for recruiting immigrant workers had been established.

Railroad Workers

Also during 1868, the US and Chinese governments signed the Burlingame Treaty, under which China allowed mass emigration of workers to the US. At the same time, labor was needed to build the first transcontinental American railroad, a massive engineering and construction feat that required thousands of workers to perform dangerous work for limited wages. Immigration agents signed contracts with employers promising specified numbers of immigrant laborers, who would sign contracts to work for at least three years in return for wages that were low by American standards. This contract labor system was difficult to enforce after the immigrant workers arrived in the US, where they could leave their jobs relatively easily for better-paying work elsewhere without serious consequences for breaking their contracts.

The railroads recruited tens of thousands of Chinese laborers from China’s Pearl River area in Guangdong Province, paying for their passage to the US. Derisively known as “coolies” to many Americans, the Chinese workers did much of the most dangerous work in the construction of the railroad, particularly in helping to blast tunnels through the Sierra Nevada range.

American companies were not the only agencies recruiting contract labor. During the 1870s, a group of Chinese American industrialists known as the Six Companies used their close ties to their homeland to attract thousands of Chinese immigrants to San Francisco to work in Chinese-run industries or to establish their own businesses. Also known as the Chinese Consolidated Benevolent Association, the Chinese Six Companies helped build a Chinese American community that would assist new immigrants in finding jobs and adapting to their new homeland. Although they have declined in popularity amongst younger generations, many of these associations continue to exist in cities with significant Chinatowns.

Other Asian countries that sent large numbers of contract laborers to the US included Japan and the Philippines. Many Japanese laborers were recruited to work on Hawaiian pineapple and sugar plantations. Under the contract labor system, they signed three- to five-year contracts to work in return for wages and free passage to Hawaii. By the end of the nineteenth century, when Hawaii became an American territory, the Japanese were one of the islands’ largest minority groups, while native islanders comprised only a small minority of the population. Filipinos were also heavily recruited to work in Hawaii. The contract labor system worked more efficiently on the islands than it did in the continental US because of the islands’ isolation and small geographical area, which limited the ability of immigrant workers to abandon their contract jobs to find work elsewhere.

Immigration laws

In the US, the influx of low-wage immigrant workers brought in by the contract labor system angered many American labor organizations, such as the Knights of Labor, which lobbied the California and federal governments to restrict or halt all Chinese immigration. The labor groups feared American wages were being depressed by cheap foreign labor and directed their ire at the Chinese. In 1862, California responded to these complaints with the Anti-Coolie Act that imposed a special tax on all Chinese workers. Particular targets of this law were Chinese miners, who were forced to pay a monthly $2.50 tax to work in California. Mining companies employing Chinese miners were responsible for collecting the tax and were subject to large fines for noncompliance. The state law targeted Chinese workers on the assumption that raising the costs of immigrant labor would stop mass immigration from Asia. However, the tax had little effect in slowing immigration.

After the passing of the 1965 Immigration Act, decades of exclusionary immigration policies directed at people of Asian descent were finally amended. Although the demographics of individuals emigrating from China to the US in the twenty-first century have drastically changed, and most arrivals are highly skilled workers, the legacy of the contract labor system has important implications for contemporary debates on immigration. For example, many Americans continue to argue that immigrants in the 2020s disrupted wages when they agreed to work for lower wages than Americans. Many Asian American communities in the US retain organizations that were started for the support of Asian immigrants in the contract labor system era.

Bibliography

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