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How Rising Wages Are Changing The Game In China A labor shortage has pay soaring. That is sure to send ripples around the globe.

For years, Yongjin Group has earned a decent profit selling lamps and furniture to the likes of Wal-Mart (WMT), Home Depot (HD ), Target (TGT ), and Pottery Barn. But lately the company has seen its margins shrink to 5% -- half what Yongjin made when it opened its factory in the steamy southern Chinese city of Dongguan 14 years ago. Why? Labor shortages are forcing the company to boost wages. Last year salaries surged 40%, to an average of $160 a month, and Yongjin still can't find enough workers. "This business needs a lot of labor," says President Sam Lin. "This is a very tough challenge."

Some 1,500 miles northeast, in the city of Suzhou, Emerson Climate Technologies Co. is facing similar woes. The maker of air conditioner compressors has seen turnover for some jobs hit 20% annually, and Emerson General Manager David Warth says it's all he can do to keep his 800 employees from jump

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Added: Nov-4-2010 Occurred On: Nov-4-2010
By: Fine_Just_Fine
In:
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Tags: China, labor, world economy
Views: 8031 | Comments: 16 | Votes: 0 | Favorites: 1 | Shared: 0 | Updates: 0 | Times used in channels: 1
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  • Comment of user 'rclark951' has been deleted by author (after account deletion)!
  • In a free market, cheap labor doesn't stay cheap forever.

    Posted Nov-4-2010 By 

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  • Their Christmas bonus this year is they get to keep their kidneys.

    Posted Nov-4-2010 By 

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  • Good old capitalism brings prosperity to yet another country. Three cheers!!!

    Posted Nov-4-2010 By 

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  • Can't wait till they all unionize. LOL

    Posted Nov-4-2010 By 

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  • Comment of user 'Zardoz003' has been deleted by author (after account deletion)!
    • You don't get it, Zardoz. The point of this article is that wages are RISING in China, as they will in other third world countries as they rise economically.

      A return to tariffs would just plunge us into depression...we've tried that before...

      Posted Nov-4-2010 By 

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    • There is no need for that even if that was effective. If you realy wish to mess up with the chinese then encourage them to pay proper pay for their workers (witch is now happening). This will make US workers (and any western worker also) more competetive with Chinese ones and more jobs will flow back from the China.

      Posted Nov-5-2010 By 

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    • Comment of user 'Zardoz003' has been deleted by author (after account deletion)!
  • I make things in China and India and import them to the US. I haven't had any price increases in the past two years, but I'm already contacting factories in Bangladesh. When China advances itself to the pint that the workers have the opportunity to earn higher wages, there's a few billion more people in other countries waiting for the opportunity to take their place on the production lines.

    Posted Nov-4-2010 By 

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    • Comment of user 'Eva_Destruction' has been deleted by author (after account deletion)!
    • Why don't you tell us what you import so we can be sure not to buy you pos.

      Posted Nov-5-2010 By 

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    • Because all of my competitors make their products overseas. The customers demand low prices and for commodity products, there is no other way to compete.

      The reality of the world is that if something is a commodity product, it's going to be made overseas until the shipping and import expenses even out the cheaper labor costs.

      Next time you buy as pair of sneakers for $10, be thankful for people like me.

      Posted Nov-5-2010 By 

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    • I make medical products and I hope you never need any of them.

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    • Many people don't understand the cost of doing business in North America. It's more than just a few dollars more. I'm in the service industry and can't relocate. At least I don't have to pay more than minimum wage. Although the government has cranked minimum wage to $10.25/hr. The payroll taxes are brutal and so are the corporate taxes. Electricity and land taxes in Ontario are insane and so is insurance. If I could relocate to China, I would.

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  • send them a few million mexicans

    Posted Nov-7-2010 By 

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