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Falling U.S. wages means it can compete with China

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dmcowen674

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Oct 13, 1999
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8-21-2014

http://finance.yahoo.com/news/the-hopeful-news-behind-falling-wages-200159489.html

The good news behind falling wages


Nobody ever wants a pay cut. But the punishing drop in wages in several U.S. industries could end up drawing more companies to the United States and helping produce millions of new jobs.

New data published by the Boston Consulting Group shows the United States is becoming considerably more competitive when it comes to labor costs for manufacturers.

In 2004, U.S. manufacturing wages adjusted for productivity were 4 times higher than those in China. Today, they’re just 2 times higher than Chinese levels. When factoring in energy costs, exchange rates and other factors, the cost of manufacturing in China is just 4% less than in the United States, down from 14% a decade ago, according to BCG.

The decline in manufacturing wages, meanwhile, has been good news for manufacturers but bad news for workers bearing the cuts.
 

fskimospy

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Mar 10, 2006
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The average US manufacturing wage has not been declining, although when adjusting for inflation it has basically been flat. We have increased our competitiveness through huge productivity gains in the manufacturing sector.
 
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