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Shift in Chinese Labor – a Plus for U.S. Manufacturing?

By February 12, 2013CMF Blog

After years of steady advancement, 2012 brought China its first slowdown in labor force growth in decades. In the last year, there was a 3.45 million decline in the number of working-age Chinese, a 0.4% drop from 2011. Primarily a consequence of China’s thirty-year one child policy, this trend is expected to continue for at least another 20 years.

By comparison, in 2012, the labor force in the U.S. increased by 1.56 million individuals, or 1%. Albeit at 7.8% unemployment, not all members within the labor force are productive. Still, it may be a bit of good news for the U.S. The decline in China should put additional upward pressure on Chinese labor rates, evening the playing field a bit for American manufacturing.

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