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Some Evidence on Competition in Labor Markets

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Here’s the core of an e-mail that I received this morning from Cafe Hayek patron Kerry Welsh (with a link added).  I thank Kerry for his kind permission to share his e-mail here.

I am really enjoying your minimum wage articles [2].

FYI I spent over a decade making products in China, and there’s an anti-minimum wage lesson to be learned that I’ve never seen in any story.

China has over a billion workers, tremendous poverty and no trade unions, so if there’s one place on this planet you’d expect workers to earn minimum-wage it’s China.

Yet we had to pay 40% over minimum wage to attract even the lowest unskilled workers, such is the demand for labor.

And here’s the (wonderfully named!) product that Kerry’s company produced in China [3], and sold in the U.S. mostly through Wal-Mart and Costco.

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