Thread: Twinkie for your thoughts

Executives are employees too. All the salaries should be evaluated in terms of the company as a whole, in my opinion.


Salaries have not increased for the average person though actually. They've stagnated, while the buying power of that salary has decreased.

You know what is cool?

Straight razors.


And everything that goes with them.

^^ that's true ^^ But I want to thank everyone because I think I have the topic for a paper!! I believe I am going to prove everything I said, and get a grade for it lol!!

It is unlikely that mfg in America is as efficient as it can be. Having been in mfg for a few years now, I recognize that there is always room for improvement. One is never as good as he can be.

This has been a great topic.

Jeff

Originally Posted by TURNMASTER

It is unlikely that mfg in America is as efficient as it can be. Having been in mfg for a few years now, I recognize that there is always room for improvement. One is never as good as he can be.

This has been a great topic.

Jeff

I agree.

Here are some thoughts that I have had for a while. My numbers have no backing but I think are reasonable, and I am using imaginary countries and wages because I realize we live in a global economy.

The raw product is produced in country X and then shipped halfway around the world to country Y. The worker in country Y makes 10,00 widgets an hour for a wage of 1 Z per hour. They then ship it back to country X. The worker in the same industry in country X makes 30 Z per hour and makes the same 10,00 widgets per hour. The labor cost per widget is 30 times more but I can't see where the shipping cost doesn't eat up that difference since the cost of labor per widget isn't that big of a difference.

Obviously I am missing something. Show me the error in my thinking.

It depends on where the inputs for the finished product are made...

For the company I work for, one of the cheapest inputs is labor, no matter what country that labor is from.

We have one shop in the US and one on Mexico - the largest determining factor for what gets made where has much less to do with labor costs than it does with where products are being shipped.

Edit to elaborate:
We make parts for tractors and industrial machinery. The company that makes the machinery has assembly plants all over the world.
Working backwards through the chain: an area of the world has a large demand for brand X tractors; brand X builds an assembly plant in that area rather than shipping finished products there; suppliers like us put shops near the assembly plants; our suppliers set up operations near us; and so on...

If all of this sounds bad for American workers, it's not - there are still plenty of plants here, and these products are selling on a global market, bringing a lot of money back here.

There's also the economic concept of comparative advantage, whereby we benefit as an entire economy from focusing on the things that are most profitable and farming out the rest.

Back to the company I work for - our USA business is stronger by also having a shop in Mexico. It's not a loss of jobs for USA workers; those jobs wouldn't exist here.