Lots of good stuff in here.

  • 80% China wage increases in five years will increase inflation in the developed world.
  • Many developed world managers haven’t dealt with source cost inflation: quite the opposite.
  • There is a shrinking key workforce in China.
  • The remaining low-cost countries (Cambodia, Bangladesh) are too small to make up for the changes in China.

What does this mean for the rest of the world? Inflation with relatively few options for cost-cutting or productivity gains to offset it. Ouch.