In 2015, US wages would be only 30% higher than Chinese wages

Immigrant · 05-25-2011, 12:10 AM

http://nextbigfuture.com/2011/05/uni...tive-with.html

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certain U.S. states become some of the cheapest locations for manufacturing in the developed world, according to a new analysis by The Boston Consulting Group (BCG).

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After adjustments are made to account for American workers’ relatively higher productivity, wage rates in Chinese cities such as Shanghai and Tianjin are expected to be about only 30 percent cheaper than rates in low-cost U.S. states. And since wage rates account for 20 to 30 percent of a product’s total cost, manufacturing in China will be only 10 to 15 percent cheaper than in the U.S.—even before inventory and shipping costs are considered. After those costs are factored in, the total cost advantage will drop to single digits or be erased entirely, Sirkin said.

American wages are going down while Chinese wages are going up, so that they would come close enough that the gap doesn't matter by 2015 when you account for other costs like shipping and import duty.

Heck, VW's new US plant in Tennessee pays $24/hr in wages and benefits(meaning the hourly wages like $12/hr), less than half that of what GM and Ford pays in Detroit. Yet people were lining up for those "good-paying" jobs at VW. Manufacturing jobs that pay $9/hr in Ohio has a competition rate of 10:1.

I can't believe how much America has fallen over the years, but this is the new cold hard reality.

LifeDreamer · 05-25-2011, 01:08 AM

WTF is this doing here...

2dreamORnot2dream · 05-25-2011, 02:37 AM

Quote:

Originally Posted by Immigrant

http://nextbigfuture.com/2011/05/uni...tive-with.html

American wages are going down while Chinese wages are going up, so that they would come close enough that the gap doesn't matter by 2015 when you account for other costs like shipping and import duty.

Heck, VW's new US plant in Tennessee pays $24/hr in wages and benefits(meaning the hourly wages like $12/hr), less than half that of what GM and Ford pays in Detroit. Yet people were lining up for those "good-paying" jobs at VW. Manufacturing jobs that pay $9/hr in Ohio has a competition rate of 10:1.

I can't believe how much America has fallen over the years, but this is the new cold hard reality.

Good!!! Maybe finally they can buy some of our shit for a change...

ppl_man · 05-25-2011, 04:37 AM

This article has many fatal comparisons. In general the Chinese cannot compete the average salary of the Americans. It is ten times harder to find a decent white collar jobs in China than here in American.
Some states are cheaper to manufacture only because they are very rural and the population density is extremely low.

Counting most white collar Chinese, the average salary is not comparable with that of the Americans.

In China, the inflation is crazy.

Immigrant · 05-25-2011, 08:49 AM

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Originally Posted by LifeDreamer

WTF is this doing here...

It shows you the future of America.

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Originally Posted by 2dreamORnot2dream

Good!!! Maybe finally they can buy some of our shit for a change...

High Chinese tariff prevents that.

Rather, job export to China will slow down as wages converge, with American wages going down while Chinese wages go up. And this is the future of America.

Quote:

Originally Posted by ppl_man

This article has many fatal comparisons. In general the Chinese cannot compete the average salary of the Americans. It is ten times harder to find a decent white collar jobs in China than here in American.

But White Collar jobs in America too are shrinking by the millions.

There is a distinctive downward pressure on American wages, that America must be able to compete to China on wages.

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In 2015, US wages would be only 30% higher than Chinese wages