Chinese Wages Are Skyrocketing!

[GHook93]

So how do they still keep the business? They manipulate their currency in an unlawful way under the WTO mandates. They put protective tarriffs against the US and Europe! Yet we toss none on them. They subsidize their industries, like steel, car parts and raw materials. Yet everyone cries foul when anyone suggests we do it.

We need to stop selling out to China, Japan, South Korea, Mexico and the 3rd World!

http://www.nytimes.com/2011/06/01/business/global/01wages.html?_r=1&src=me&ref=business
Wages are surging this year in China and among its main low-wage Asian rivals, benefiting workers across the region. But the increases confront trading companies and Western retailers with cost increases and are making higher prices likely for American and European consumers.

Bruce Rockowitz, the chief executive of Li & Fung, the largest trading company supplying Chinese consumer goods to American retail chains, said in a speech here on Tuesday that the company’s average costs for goods rose 15 percent in the first five months of this year compared with the same period last year. Executives at other consumer goods companies have encountered similar or larger increases.

Airline flights to Vietnam, Bangladesh, Indonesia and other low-wage Asian countries are packed these days with executives looking for alternatives to double-digit wage increases in China. But wages are rising as fast or faster in many of these countries, following China’s example, while commodity prices have surged around the world, leaving buyers with few places to turn.

Bangladesh raised its minimum wage by 87 percent late last year, yet apparel factories there are still struggling to find enough workers to complete ever-rising numbers of orders. “Everywhere you see signs saying ‘people wanted,’ “ said Annisul Huq, the chairman of the Mohammadi Group, a large Bangladesh garment manufacturer.

The Gap surprised financial markets on May 19 by announcing that a 20 percent jump in costs from suppliers by the second half of this year would depress its profits, prompting a 17.5 percent plunge of its shares the next day. Coach, the luxury handbag company, announced in January that it would try to reduce its reliance on China to less than half of its products within four years, from 80 percent now, by moving production to Vietnam and India.

Yet wages in Vietnam have been rising as fast as Chinese wages, or faster, while India has posed many problems for large-scale manufacturers. Mr. Rockowitz said that India’s infrastructure — roads and ports — was “really poor,” while labor issues, including government regulations, make it hard to build Chinese-style factories for tens of thousands of workers.

With costs rising in China and few alternatives elsewhere, “you have the perfect storm for raising prices,” said Bennett Model, the chief executive of Cassin, a Manhattan-based line of designer clothing. The company’s costs have risen 25 to 35 percent in the last year for cotton and fur garments alike.

Cassin has begun experimenting with garment production in Guatemala with some success, Mr. Model said, adding that many garment companies were still leery of buying from anywhere except China. “Everybody’s scared of the quality — you spend so many years training a factory” to meet detailed specifications, he said.

Yet with 14 million people, Guatemala has the population of only a single large Chinese metropolitan area like Shenzhen or Guangzhou.

 

[Valerie]

Do you have any whole numbers that are not represented only in percentages?


Cuz if the guy at the sweatshop now earns two dollars instead of one dollar that is a 100% increase, but the real value is still only a dollar...

 

[Baruch Menachem]

Rdean opposes the concept of Chinese workers getting paid better.
</troll>

 

[Sallow]

So how do still keep the business? They manipulate their currency in an unlawful way under the WTO mandates. They put protective tarriffs against the US and Europe! Yet we toss none on them. They subsidize their industries, like steel, car parts and raw materials. Yet everyone cries foul when anyone suggests we do it.

We need to stop selling out to China, Japan, South Korea, Mexico and the 3rd World!

http://www.nytimes.com/2011/06/01/business/global/01wages.html?_r=1&src=me&ref=business
Wages are surging this year in China and among its main low-wage Asian rivals, benefiting workers across the region. But the increases confront trading companies and Western retailers with cost increases and are making higher prices likely for American and European consumers.

Bruce Rockowitz, the chief executive of Li & Fung, the largest trading company supplying Chinese consumer goods to American retail chains, said in a speech here on Tuesday that the company’s average costs for goods rose 15 percent in the first five months of this year compared with the same period last year. Executives at other consumer goods companies have encountered similar or larger increases.

Airline flights to Vietnam, Bangladesh, Indonesia and other low-wage Asian countries are packed these days with executives looking for alternatives to double-digit wage increases in China. But wages are rising as fast or faster in many of these countries, following China’s example, while commodity prices have surged around the world, leaving buyers with few places to turn.

Bangladesh raised its minimum wage by 87 percent late last year, yet apparel factories there are still struggling to find enough workers to complete ever-rising numbers of orders. “Everywhere you see signs saying ‘people wanted,’ “ said Annisul Huq, the chairman of the Mohammadi Group, a large Bangladesh garment manufacturer.

The Gap surprised financial markets on May 19 by announcing that a 20 percent jump in costs from suppliers by the second half of this year would depress its profits, prompting a 17.5 percent plunge of its shares the next day. Coach, the luxury handbag company, announced in January that it would try to reduce its reliance on China to less than half of its products within four years, from 80 percent now, by moving production to Vietnam and India.

Yet wages in Vietnam have been rising as fast as Chinese wages, or faster, while India has posed many problems for large-scale manufacturers. Mr. Rockowitz said that India’s infrastructure — roads and ports — was “really poor,” while labor issues, including government regulations, make it hard to build Chinese-style factories for tens of thousands of workers.

With costs rising in China and few alternatives elsewhere, “you have the perfect storm for raising prices,” said Bennett Model, the chief executive of Cassin, a Manhattan-based line of designer clothing. The company’s costs have risen 25 to 35 percent in the last year for cotton and fur garments alike.

Cassin has begun experimenting with garment production in Guatemala with some success, Mr. Model said, adding that many garment companies were still leery of buying from anywhere except China. “Everybody’s scared of the quality — you spend so many years training a factory” to meet detailed specifications, he said.

Yet with 14 million people, Guatemala has the population of only a single large Chinese metropolitan area like Shenzhen or Guangzhou.

Agreed.