[Zhang Fei]

A few years back, I read an article in a business magazine about a Chinese factory owner. His company made light fixtures. He was closing his factory in China and moving it to Vietnam. Why? Because he could pay his labor in Vietnam $100 a month.

If I recall correctly, the Vietnamese minimum wage back then was $50 a month, so they're not getting the dregs for $100 a month. That's the beauty of operating in cheap labor countries - you can get several college grads for price of 1 stateside high school dropout. The problem is that those foreign college grads tend to go into business for themselves, whereas the high school dropout will probably never compete with you.

[PapaBear3625]

If I recall correctly, the Vietnamese minimum wage back then was $50 a month, so they're not getting the dregs for $100 a month. That's the beauty of operating in cheap labor countries - you can get several college grads for price of 1 stateside high school dropout. The problem is that those foreign college grads tend to go into business for themselves, whereas the high school dropout will probably never compete with you.

That's been the pattern when US companies outsource to "cheap" foreign countries: as soon as the people in the foreign operation learn all your trade secrets, intellectual property, and general know-how, they quit and start up their own operation, selling the same product for less to WalMart or some such.

But it does improve the CEO's numbers for the first few years.