We started comparing the average wages across Asia in 2015 to help importers decide which country might be the best option for them to source from. As I mentioned before, you need to consider the following data (among others): The trend of the average wages in the countries in question The stability of exchange rates, for example against the US dollar Back in 2015, China's increasing wages were followed by other neighboring countries. Its 'real' cost of skilled factory labor, which … [Read more...]
9 Consequences of the Upcoming US-China Trade War
Based on all the articles I have read about the current geopolitical situation, I am not optimistic about the affect of the US-China trade war on American importers. Dan Harris, who wrote "the US-China Cold War start now," announced that a "mega-storm" might be coming, and he may be right. Now, if things turn out as bad as predicted, and if tariffs apply on more goods imported from China to the US -- and at higher rates -- what does it mean for US importers? … [Read more...]
How China Is Losing Competitiveness… On Paper
Three years ago, in Comparing Wages Across Asia to Make Sourcing Decisions, I showcased 2 analyses large companies tend to do before they decide on their sourcing strategy. These data are key measures of the competitiveness of producing countries. At the time, I explained: Naturally, most companies that want to compare Asian countries tend to do so on the basis of easy-to-find numbers: minimum wage levels. The conclusion is usually “China is not competitive; the future is in Vietnam, … [Read more...]