Tuesday, October 03, 2006
[IWS] Conference Board: LOW-WAGE COUNTRIES NO BARGAIN--Report [3 October 2006]
IWS Documented News Service
_______________________________
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
________________________________________________________________________
Conference Board
Press Release
The Conference Board Report Finds Low Wages Not Always Key Success Factor for Overseas Investment
Oct. 3, 2006
http://www.conference-board.org/utilities/pressDetail.cfm?press_ID=2973
or
http://www.conference-board.org/utilities/pressPrinterFriendly.cfm?press_ID=2973
The comparative cost advantage of taking your business to low-wage countries such as China or India, where unit labor costs in manufacturing are 20 percent lower than in the U.S., are often not the bargain they seem when wages are adjusted for low productivity, according to a report released today by The Conference Board.
This is also true of decisions to locate in Mexico, Central and Eastern Europe rather than in North America and Western Europe.
"One critical lesson for businesses that benefit from one-time labor cost benefits when investing in 'low wage' countries is that productivity gains from new technology and innovation have to keep pace with often fast rising wages of skilled and semi-skilled workers or the 'cost advantage' begins to erode," says Bart van Ark, Director of The Conference Board international economic research program and co-author of the report with The Conference Board Director of Global Demographics, Judith Banister, and Economist Catherine Guillemineau, formerly of The Conference Board.
AND MORE....
Source: Competitive Advantage of Low-Wage Countries Often Exaggerated
Executive Action No. 212
The Conference Board
http://www.conference-board.org/publications/execaction.cfm
______________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016
Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
****************************************
_______________________________
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
________________________________________________________________________
Conference Board
Press Release
The Conference Board Report Finds Low Wages Not Always Key Success Factor for Overseas Investment
Oct. 3, 2006
http://www.conference-board.org/utilities/pressDetail.cfm?press_ID=2973
or
http://www.conference-board.org/utilities/pressPrinterFriendly.cfm?press_ID=2973
The comparative cost advantage of taking your business to low-wage countries such as China or India, where unit labor costs in manufacturing are 20 percent lower than in the U.S., are often not the bargain they seem when wages are adjusted for low productivity, according to a report released today by The Conference Board.
This is also true of decisions to locate in Mexico, Central and Eastern Europe rather than in North America and Western Europe.
"One critical lesson for businesses that benefit from one-time labor cost benefits when investing in 'low wage' countries is that productivity gains from new technology and innovation have to keep pace with often fast rising wages of skilled and semi-skilled workers or the 'cost advantage' begins to erode," says Bart van Ark, Director of The Conference Board international economic research program and co-author of the report with The Conference Board Director of Global Demographics, Judith Banister, and Economist Catherine Guillemineau, formerly of The Conference Board.
AND MORE....
Source: Competitive Advantage of Low-Wage Countries Often Exaggerated
Executive Action No. 212
The Conference Board
http://www.conference-board.org/publications/execaction.cfm
______________________________
This information is provided to subscribers, friends, faculty, students and alumni of the School of Industrial & Labor Relations (ILR). It is a service of the Institute for Workplace Studies (IWS) in New York City. Stuart Basefsky is responsible for the selection of the contents which is intended to keep researchers, companies, workers, and governments aware of the latest information related to ILR disciplines as it becomes available for the purposes of research, understanding and debate. The content does not reflect the opinions or positions of Cornell University, the School of Industrial & Labor Relations, or that of Mr. Basefsky and should not be construed as such. The service is unique in that it provides the original source documentation, via links, behind the news and research of the day. Use of the information provided is unrestricted. However, it is requested that users acknowledge that the information was found via the IWS Documented News Service.
Stuart Basefsky
Director, IWS News Bureau
Institute for Workplace Studies
Cornell/ILR School
16 E. 34th Street, 4th Floor
New York, NY 10016
Telephone: (607) 255-2703
Fax: (607) 255-9641
E-mail: smb6@cornell.edu
****************************************
# posted by SBasefsky : 8:21 AM
