The Great Divergence

[--Pete]

Hi,

Bringing Reebok manufacturing back from countries that pay a couple dollars a day to a country that pays a minimum of seven dollars an hour is not a sensible solution for anyone. It would hold back any increase in labour productivity for as long as those jobs stayed in the first world, and it would prevent relatively poor countries from manufacturing at all.

Actually, some manufacturing is coming back onshore, but it isn't generating much in the way of jobs. As processes become more automated, it makes sense to put them close to the market and to the support personnel. Labor costs don't matter when there is no labor. Reliable, cheap power does.

Just how many butlers, chefs, chauffeurs, maids, landscapers, can the economy support when only the intelligent and creative can find jobs?

--Pete