20Oct 2018
China
Posted in
Economics
Many people do not seem to have a very accurate picture of China. Many think that the Chinese are indentured slaves of The West – that The West is capitalizing on their cheap labour.
I’ve been to Hong Kong and Mainland China many times. A Chinese associate of mine likes to tell this story on himself. He says that when his grandmother learned that at the age of 18 he was still in school, she told him that he must be a slow learner. Times are changing in China. Two or three decades ago everybody rode bicycles, then it was motorcycles, now cars – China is the world’s largest manufacturer of cars.
It’s true that Chinese just off the farm make very low wages by our standards. They usually start in a labour intensive factory at a low wage. They know very little and are not very productive. But they earn enough to support themselves, send some money back to their family and take a 3 to 4 week vacation at Chinese New Year – the world’s largest annual human migration. They use this vacation time to visit their families and look for a better job. The proof that these low wage workers are not indentured is the fact that 40 to 50% of them will not return to their first job – they will have found a better job at a higher wage because they now have factory experience. And they’re on their way. Just a little capitalism in China has raised hundreds of millions out of abject poverty.
Is The West capitalizing on Chinese cheap labour? Yes, of course. Why should we pay more for goods than we have to? It’s a win-win relationship.
I’ve been to Hong Kong and Mainland China many times. A Chinese associate of mine likes to tell this story on himself. He says that when his grandmother learned that at the age of 18 he was still in school, she told him that he must be a slow learner. Times are changing in China. Two or three decades ago everybody rode bicycles, then it was motorcycles, now cars – China is the world’s largest manufacturer of cars.
It’s true that Chinese just off the farm make very low wages by our standards. They usually start in a labour intensive factory at a low wage. They know very little and are not very productive. But they earn enough to support themselves, send some money back to their family and take a 3 to 4 week vacation at Chinese New Year – the world’s largest annual human migration. They use this vacation time to visit their families and look for a better job. The proof that these low wage workers are not indentured is the fact that 40 to 50% of them will not return to their first job – they will have found a better job at a higher wage because they now have factory experience. And they’re on their way. Just a little capitalism in China has raised hundreds of millions out of abject poverty.
Is The West capitalizing on Chinese cheap labour? Yes, of course. Why should we pay more for goods than we have to? It’s a win-win relationship.
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