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Labor is a tiny fraction of the cost of manufacturing. The media likes to make it seem like the cost of labor is the largest part of goods.
by Tangurena2 4y ago
Labor is a tiny fraction of the cost of manufacturing. The media likes to make it seem like the cost of labor is the largest part of goods.
- kurthr 4y agoExactly, a huge part of the delivery of low cost Chinese goods was subsidized delivery by the USPS. That was subsidized by US agreement rather than foreign labor. If the delivery was a realistic $5 for the 50cent paper cups you ordered, it wouldn't be competitive to import them (directly through Amazon/eBay). The advantage China has had is really factories and supply chains due to investment. Building those factories in the US is totally possible at marginal increases in price, but simultaneously marginal decreases on profit. Having a foreign government borrow/loan all the money to build the infrastructure for your factories simply for the cost of transferring your IP to them seemed like an obvious quarterly profit improvement!