China Is Losing its Labor Edge

Shrinking pool of young workers pushes up wages.

Standing on a street corner near Foxconn Technology Group’s plant in central China that makes iPhone 5 handsets, employee Wang Ke says he’ll quit if his wage doesn’t double.

“I don’t have high expectations, I know I’m a migrant worker,” said Wang, 22, who earned 1,600 yuan ($258) in December, after deductions for lodging. “But I want to make 3,500 yuan a month, net. That’s a fair price.”

‘Tipping Point’

The gap between manufacturing costs in the U.S. and China has almost halved in the past eight years and will fall to 16 percent this year, according to Hackett Group Inc., a Miami-based consulting company. That’s a “tipping point” that will prompt some companies to shift factories back to the U.S. or to destinations nearer consumers, says Hackett, which lists customers including Pfizer Inc., Microsoft Corp. and Boeing Co. on its website.

Search Reward

On field trips since 2008, Rozelle offered about 300 students and interns a 100-yuan reward for every person they could find between the ages of 20 and 40 who worked on a farm.

Homemade Noodles

“It’s nice to be a bit closer to home,” said Wang, 23, from Dengfeng, a nearby wheat-growing county. “I can go home often and have my mother’s homemade braised noodles.”

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