Mr. Woo, the Hon Hai spokesman, said labor expenses aren't a major cost for Foxconn and that the more important question was whether China's younger workers will continue to have the desire to work difficult manufacturing jobs.

WSJ: Hon Hai Riot Highlights Squeeze on Chinese Manufacturers

Hon Hai Chairman Terry Gou said last month that the yield rate of Apple's touch-screen devices hasn't been satisfactory and has hurt its profitability.

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Two people said Hon Hai Precision Industry Co.

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Analysts said the scale of Hon Hai's operations and the tedious nature of the work mean difficulties for the company likely will continue.

WSJ: Hon Hai Riot Highlights Squeeze on Chinese Manufacturers

Hon Hai - the parent company of Foxconn - said the deal would help prevent its clients being caught up in an ongoing intellectual property dispute.

BBC: Foxconn factory

Mr. Gou said the letter was poorly worded by Hon Hai's legal team.

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But employees said workers from other facilities, including Hon Hai's factories in the southern Chinese city of Shenzhen, recently were brought in to help with a large order.

WSJ: Hon Hai Riot Highlights Squeeze on Chinese Manufacturers