China Now Comes to USA for Cheap Labor?

Re: [spiers] China Now Comes to USA for Cheap Labor?

To me the question is one of choice... do people who accept the jobs do so
freely...? if so,
they must surely have chosen among options... second, those who choose freely
inevitable
"conspire" against the bosses and begin to demand more of the income of the
factory...
(except in places like the United States where govt-sponsored inflation has seen
to it that
labor has not gotten an effective raise since 1973, and those who are retiring
are finding out
their pensions are bust). It seems to me the conditions in China are precisely
those we had
maybe 100 years ago, and China is using the exact same means we used to grow
rich.

John
On Fri, 21 Jul 2006 08:02:17 -0700, "choigrogan Choi-Grogan"

wrote :

>
> When we said that "the Chinese style labor market is with minimum wage
structure and
zero benefit structures", we are very much ill informed. The Chinese government
has
regulations in place and the employers are required to provide health benefit,
retirement
pension, and insurance to their employees. Moreover, many manufacturers there
have
difficulty finding good employees due to the tight labor market, minimum wage
without
benefit will not work per the demand and supply theory. Don't use a few news
coverage to
generalize the labor treatment there. Don't purely use the wage number without
understanding their living cost structure.
>
> Let's say a machine operator is paid US$400-500 a month, in most cases, the
factory will
provide housing and food for them. So they keep most of the take home paycheck
without
much living expenses. They often will send the money back to their family. If
they do need
to rent, the average rent per month is about US$90-100/month. This is not in
Beijing or
Shanghai city center of course, but this is the average housing cost near most
of the
manufacturing zones. A banquet full service dinner for 30's people cost
US$100..... I don't
think we can find that kind of expenses here in the States. With this cost
scale of living here
in the States, I think some of these Chinese workers have better situation than
the US workers
in some retails and fast food or service industries.
>
> ----- Original Message -----
> From: grp grp
> To: spiers@yahoogroups.com ;
grp123@gmail.com
> Sent: Wednesday, July 19, 2006 4:34 PM
> Subject: Re: [spiers] China Now Comes to USA for Cheap Labor?
>
>
> > Another few points:
> > 1) You say "labor cannot be critical.".... Labor costs >vary among the
> present US >automakers and a new >company entering the system, with no
> legacy >pension> costs, etc., >would be expected to have >lower labor costs
> than many existing manufacturers.
>
> > 3) Your thesis that labor costs are irrelevant is >absurd. Labor costs
> are one component > of final >total product costs. To the extent that labor
> is a large >component of final total product costs (vs. materials,
> >transportation, etc.) labor will be a relatively important >factor in the
> cost of the good, its price >competitiveness and ability to compete in the
> >marketplace.
>
> ***Little of what USA imports has a component cost of labor more than 5%...
> but that is not my main thesis, the cost of management to make baskets in
> USA is too expensive, management oversas is cheaper. People with Ag degrees
> go into govt, while mexicans
> manage the farms, since mexican management is cheaper than usa management.
> The thing is management cost,***
>
> If I can take an item from $Dollar store retailer in USA, as an argument
> for above; Which will cost a retailer .50Cents per item (for example), to
> bring it over to USA, after all the upfront cost and don't forget you have
> to buy in huge consignments to get best prices. With about 4 to 6 employees
> @ about $6/hr to 12/hr; retailer's cost of goods of the item can bring it UP
> to say .80Cents per item or more; than add other retailer's cost, where is
> the retailers margins? Even if retailer is doing the volume business!
> Somewhere, someone(s) is making lots of money minus the US retailer.
>
> When it comes to US labor; as per my opinion, are turning into Chinese style
> labor market with minimum wage structure and zero benefit structures. Large
> retailers and fast food chains in US have successfully been able to do this,
> now gradually auto workers will see the same trend, if they want to work in
> MG plant managed by Chinese management.
>
> Compete on Design: I as a consumer would prefer GM cars over KIA when it
> comes to design, because as per my opinion GM cars looks much better and
> designed much better. Than why is KIA selling more? I think it is more than
> a design when it comes to consumers phyche!!
>
> Grp

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