The East-West Wage Gap Is Closing
Commentary
One of China’s great economic advantages is going away. Relatively low-cost, reliable labor has been a mainstay of China’s economic engine for decades.
Manufacturers from Europe and North America for years rushed investments into China to produce their products at a lower cost than they could domestically, first simple, cheaper items and later more sophisticated, high-value items. This investment and the income it generated helped propel China’s fantastic pace of economic growth. But for some time, wages in China and Asia generally have been rising faster than wages in the West, so today, the allure of that low-cost advantage has all but disappeared….