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In the era between the 1980s and 1990s http://www.cheapairmaxsaleonline.org/ , the Chinese workers were the cheapest because their cost of labor about their productivity was lower in comparison to most of the other regions. As a result, a majority of firms sourced for the Chinese employees to be able to earn profits resulting in rapid employment rates and the consequent rural to urban migration. The changes that have taken place since the 1990s such as the institutional reforms in the Chinese labor market along with the demographic transition have led to a reduction in the under pricing of the Chinese labor. The wages in China are currently increasing at a rate that is faster than the productivity of these employees especially in those industries such as the export markets that are labor intensive.
These export industries such as the electronics and the apparel are facing the likelihood of being forced out of China to other countries with cheaper labor as India and Vietnam. In the year 2010 the annual wage that the Chinese urban worker earns reached US dollars $5,487 which is identical to the wages that employees earn in the Philippines and significantly more than what workers in India earn. The rapid increase in Chinese wages in comparison to the productivity presents the suggestion that their labor is consequently becoming more expensive. The end of the cheap Chinese labor is not an indication of the end of the Chinese economic development. The rise in productivity, as well as education cheap nike vapormax , implies that china鈥檚 comparative advantage is on a shift. The ability of China to raise the technological ladder is possible because the aggregate productivity of their labor has been on an increase for the past decade at the rate of 11.3%. The factors supporting this attribute are the heavy investment in research that the manufacturing firms are undertaking as well as the significant rise in the human capital.
Part Two
The argument by the article emphasize on the end of the cheap labor in China but ignoring to tell us the manner in which this rise is going to have on the companies鈥?operating in the country. The cheap labor that the Chinese labor markets possessed for decades has been the main factor that motivated the multinational companies to set up industries in China. However, the progressive rise in the labor costs will eat into their profits. Thus, it is imperative that the writers try to outline the ripple effect that this rise will have on these companies as well as the Chinese employees. It follows that while some will close shop and look for other locations with cheaper labor as India, others will fire employees top reduce their operating costs and thus increasing the rate of unemployment in China. Thus cheap air vapormax , the writers should have outlined the strategies that the companies operating in China will adopt in surviving.
The fact that most of the appliances and productions all over the world have their origins in China, it would have been pragmatic for the writers to outline how it affects the rest of the world around. The writers additionally underemphasize the advantage that the rise in labor costs has for China as a country. It follows that with the rise in the labor costs; the employees will earn more and consequently have more to spend in their local economies facilitating the development of the primary infrastructure as health and education.
鈥?br > Reference
Li, H., L. Li cheap air max 97 , B. Wu, and Y. Xiong (2012).The End of Cheap Chinese Labor. Journal ofEconomic Perspectives,26(4),Fall cheap air max 95 ,5774.
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