Executive Briefings

What Does Labor Unrest in China Mean for Foreign Companies There?

As China becomes more affluent, how big a share of the pie do the workers who have turned the country into a global exporting powerhouse deserve?

Evidence suggests they haven't been getting their due. For instance, in 1999, the ratio of Chinese laborers' income to the gross domestic product was 53 percent, the Los Angeles Times reported in June. Today, it's 40 percent, compared with 57 percent in the United States.

And for foreign companies operating in China, what do the labor problems mean? Are they a watershed moment in China's economic development? Will they push companies to relocate to other sourcing spots in Asia? Or will the labor problems in more mature, expensive coastal regions push more manufacturing activities into interior China?
There are a lot of questions and few answers.

Read Full Article

As China becomes more affluent, how big a share of the pie do the workers who have turned the country into a global exporting powerhouse deserve?

Evidence suggests they haven't been getting their due. For instance, in 1999, the ratio of Chinese laborers' income to the gross domestic product was 53 percent, the Los Angeles Times reported in June. Today, it's 40 percent, compared with 57 percent in the United States.

And for foreign companies operating in China, what do the labor problems mean? Are they a watershed moment in China's economic development? Will they push companies to relocate to other sourcing spots in Asia? Or will the labor problems in more mature, expensive coastal regions push more manufacturing activities into interior China?
There are a lot of questions and few answers.

Read Full Article