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The End of Cheap China

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The End of Cheap China

Economic and Cultural Trends that Will Disrupt the World

Wiley,

15 min read
10 take-aways
Text available

What's inside?

As Chinese wages rapidly rise, so will the cost of consumer goods for Westerners.

Editorial Rating

7

Qualities

  • Eye Opening
  • Insider's Take

Recommendation

Think beyond the incorrect stereotypes about China and read Shaun Rein’s reality check. This respected China expert takes you behind the scenes to see what is going on in China today. His main message is a cautionary note for Westerners: As Chinese factory wages skyrocket, products made in China and sold around the globe will become more expensive, and China will become the world’s most dynamic retail market. Despite its perhaps too-benign view of the Chinese government, getAbstract recommends Rein’s report to manufacturers, retailers and consumers.

Summary

China: It’s Not the Nation You Think It Is

Outsiders wrongly assume that China has millions of poor people who will work for pennies. China does have a vast number of people, 1.3 billion and counting, but pennies won’t do anymore. China was known for cheap labor in the past, but no longer. Strong foreign investment in recent years has produced millions of relatively well-paying jobs for Chinese men and women. The upsurge is a wonderful time for China’s young people. They have watched their nation’s economy soar. They are enthusiastic about the future and excited about their individual prospects.

This marks a big change. As late as the 1990s, Chinese workers would take any job to feed themselves and their families. Finding a job was terribly difficult, but now plenty of work is available in China, and much of it pays a good wage.

The Impact of Skyrocketing Wages

As Chinese factory wages increase, companies that moved their production facilities to China from the United States and other nations may be forced to move again to countries with lower wages, such as Indonesia or Vietnam. Some American firms may even choose to relocate their manufacturing back...

About the Author

Shaun Rein is founder and managing director of the China Market Research Group and the author of a weekly CNBC column on business in China.

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    A. 3 years ago
    I see... In the era of post Chinese factory, it will be Vietnam and Thailand. But Chinese remains as big consumer...
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    S. C. 7 years ago
    I think it is not a good idea for Chinese business