Originally Posted by zoetmb
That's absolute B.S. Let's say there are no unions and all a company has to pay is federal minimum wage of $7.25 an hour and offer absolutely no benefits. Let's say the employees have a mandatory one-hour lunch which they don't get paid for, 10 holidays which they don't get paid for and 2-weeks off which they don't get pair for.
That still works out to $12,180 per year (which no one can live on in the U.S. anyway. In most places, housing costs alone would eat all of it.)
Chinese manufacturing workers are reputed to work up to 60 hours a week for $130 per month ($1560 per year.) Let's say within a few years, Chinese workers DOUBLE their pay to $3120 per year and only work 35 hours per week. That's still only 26% of a U.S. worker's minimum wage with no benefits.
That's why manufacturing has left the U.S. Not because of unions. Unions do suck in many ways, but they also helped to create the middle-class in the U.S. And now, there's fewer than 15 million American workers covered by unions, mostly public workers.
Even that's an oversimplification. Manufacturing has left the US for MANY reasons - and labor costs are only a part of it.
If you're making t-shirts, labor is a major component. If you're building iPhones, labor is a much smaller factor. The bigger factors which drive the decision as to where to manufacture are:
- Corporate income tax rates
- Currency exchange rates (manipulated by foreign governments in some cases)
- Availability of workers and other resources
- Proximity to world markets (less than half of Apple's sales were U.S.)
- Health, safety, and environmental regulations
- Liability laws and risks (few, if any, countries love to sue as much as the U.S.)
- Worker flexibility
- Local government rules
- And many, many other factors.
Most of those factors are entirely beyond the control of manufacturers and most are unrelated to direct labor rates. Even if labor were free in the U.S., there are many products that would STILL not make sense to manufacture here.