From an article by Mark Lee dated 6/22/2010:
June 22 (Bloomberg) -- New minimum wage laws, a looser yuan and worker strikes like those affecting Honda Motor Co. and Toyota Motor Corp. are raising costs at plants in China’s Pearl River Delta, leading to increased automation of assembly lines.
Foxconn Technology Group, Nissan Motor Co.’s Chinese venture and VTech Holdings Ltd. said they are investing in factory equipment to reduce their reliance on labor. Wages in the region called the world’s factory floor increased 17 percent in the past six months, according to a survey by the government- backed Hong Kong Trade Development Council.
Read the rest of the article here.
Clearly, what observers like Tom Friedman, myself and others have predicted is coming true. Wages will rise until they are similar in purchasing power with the West. Then we will have to compete on a level playing field. It WILL happen. Is your company ready?
