While the fast-growing economies of China and India have siphoned off much work that used to be done in America, copying them wouldn't be a smart strategy for the United States, according to the Obama administration's manufacturing czar.
Ron Bloom, the president's senior counselor for manufacturing policy, was in Milwaukee recently to meet with chief executives of nine industrial companies. He said in an interview that he sees no advantage in what many label a race to the bottom: trying to slash American labor costs to compete with China and India.
Asked why automakers in Germany and Japan can make cars at a profit, even though their labor costs often exceed U.S. levels and those nations offer universal health care, Bloom said:
"What Germany and Japan teach us is that paying people well is a good thing. High-wage, high-productivity, high-road strategies are the only way that advanced economies can succeed in manufacturing.
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