The End of Cheap China, Revised and Updated: Economic and Cultural Trends That Will Disrupt the World

CHAPTER 2CHEAP CHINESE LABOR? NOT ANYMORE CHINA’S WORKERS ARE DEMANDING BETTER PAY AND BETTER CONDITIONS—AND THEY ARE EARNING THEM

I opened my car door and was punched with jabs of heat that felt like I was stepping into a furnace. A thick layer of brackish grime immediately coated the car’s hood. No matter how often I cleaned it, grit from the filth that blankets the whole country—created by endless construction and peasants burning garbage—swaddled the vehicle instantly.

To my left I saw a balding security guard in a golf cart signaling me to follow him toward the entrance to what seemed like the world’s largest building. I was about as far as possible from the gilded meeting room at the Okura Garden Hotel. Instead of discussing business with billionaires and millionaires, I was about to meet the backbone of Chinese society: thousands of factory workers, whose sacrifices while toiling far from home had helped the country gain much-needed foreign hard currency in the 1990s by making products for Americans.

I was visiting the 2-million-square-foot Shanghai factory of Laura Furniture, one of the world’s largest furniture manufacturers. Many of the sofas Americans buy come from this factory or from one of its sister facilities down in Guangzhou in southern China. I was there to discuss with Bob, the president of the company, how to deal with rising labor costs and an appreciating renminbi.

The combination of the two was killing Laura Furniture’s margins, Bob had told me on a crackling ...