Manufacturing costs are rising every year. Companies are complaining about the rising costs, however, China is getting so good at producing quickly and efficiently, that they can increase their wages. Some companies have attempted to go to other places such as Sri Lanka or Vietnam, but they do not have the resources, or experience Chinese do. Another reason China can raise their prices is because China is huge. They have access to so many workers that when the demands for iPhones rose, they were able to get a crew of 8000 on the assembly line by midnight. Some companies have considered moving their factories more inland, away from the coast, in order to cut costs. However, they found that by doing this they only cut costs 5-10%. The article goes on and talks about how China is moving so fast, they must either begin to innovate, or slow down. I found this article interesting because Chinese people are actually putting their foot down and demanding more money. It makes the fact that China might soon have more power than we expect. This article was very informative and interesting.
Kirk Robison
http://www.economist.com/node/21549956
This also makes me think about what the effects will be on the United States if China does start raising the prices of their goods. Because we depend so heavily on them for cheap goods, it could have a drastic effect on our economy.
ReplyDelete-Stacy Collyer
I was just impressed that they were able to get so many people on the assembly line by midnight, thats amazing. It also makes me realize how demanding and needy us americans are. It will be interesting to see what the Chinese do with so little-money, space, and extras that we take advantage of.
ReplyDeleteCompetition will always prevail. If China continues to have high rates companies will begin to look elsewhere. China has greatly contributed to our increased standard of living, so in an ideal American world they'd remain stagnant helping us. But, competition will always win out.
ReplyDeleteI think it's good to hear that china is raising its wages for workers. Hopefully the money is actually going to the workers and not to other places.
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