China Now Comes to USA for Cheap Labor?

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

Not only is China coming to USA for cheap labor but it seems to be losing
its manufacturing allure to countries such as Vietnam and Malaysia due to
increased labor costs...

http://online.wsj.com/public/article/SB115489994036428120-x8gD_CqWa81zuWhbbT
YVRE4oByw_20060813.html?mod=regionallinks

Roy Gilbert, Jr.
USA


-----Original Message-----
From: spiers@yahoogroups.com [mailto:spiers@yahoogroups.com]On Behalf Of
John Spiers
Sent: Saturday, July 22, 2006 6:13 PM
To: spiers@yahoogroups.com
Subject: 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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