Labor Costs

ScutMonkey

Well-Known Member
#1
https://a.msn.com/r/2/BBS6nd6?m=en-us&referrerID=InAppShare

So I was reading this completely unrelated article and it vividly demonstrates the vast disparity between labor costs in a country like China and labor costs in many Western countries. The poverty line in China is $360 a month or $4320 a year. The article happily describes how the father now makes $600 a month and gets to see his family three times a year. That is a scant $7200 a year.

In the US, the poverty line for a family of four is $24,600. Five times what it is in China. It kinda makes me wonder why Epiphones are so expensive if a Gibson is only two to three times the price.
 

SemiCullen

Still haven't got the hang of Thursdays
#2
And there's a lot more to it than salary. There's healthcare costs, taxes, utilities, transportation ... all of which is more expensive in the U.S. than China. The price for products is based on what the market will bear, not a simple percentage markup over cost.
 

ScutMonkey

Well-Known Member
#3
And there's a lot more to it than salary. There's healthcare costs, taxes, utilities, transportation ... all of which is more expensive in the U.S. than China. The price for products is based on what the market will bear, not a simple percentage markup over cost.
I don't even want to think of the working conditions for those Chinese factory workers. I wonder how many of those places could even pass an OSHA inspection (Occupational Health and Safety Administration in the US).
 

Strigidae

I like owls.
#4
I don't even want to think of the working conditions for those Chinese factory workers. I wonder how many of those places could even pass an OSHA inspection (Occupational Health and Safety Administration in the US).
Most people don't want to think about it, that's why they don't have any problems with buying cheap far-eastern alternatives.
 
#5
One complicating factor is the cost of machinery. Factories in the West tend to be highly automated, because manual labour is so expensive. In countries where manual labour is cheap, there is less incentive to automate, and so they probably take more man-hours to build a guitar in the East than in the West. If they take twice as long but labour is 1/5 of the price, that's still only 2/5 of the labour cost at the end of the day.
 
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