When the world gets closer.

We help you see farther.

Sign up to our expressly international daily newsletter.

Enjoy unlimited access to quality journalism.

Limited time offer

Get your 30-day free trial!

A new labor report shows the narrowing gap between developed and developing worlds is also driven by Western decline

Textile workers in India (Jessica Steiner)

PARIS - The International Labor Organization (ILO) has released a new and very detailed survey on wages in 115 countries. As always the study's results are highly anticipated, as a global snapshot of trends in wages, economic growth, productivity and living standards.

This year's conclusions can be divided into two key areas: wage progress in many (but not all) emerging economies, and the general economic standstill in developed countries.

During the worst two years of the global financial crisis, 2008 and 2009, wages in rich countries did not decline as feared—but they didn't rise either. In the rest of the world, on the other hand, wages continued to climb, and in some cases, even skyrocketed. In Asia, in particular, the average worker saw a 7% increase in his wages in real terms, taking inflation into account.

In fact, the ILO report issued Wednesday found that this trend has persisted over a much longer period. Over the last ten years, average real wages have increased 25% globally. They doubled in Asia, and even tripled in some Eastern European countries. In advanced economies, however, they only increased by 5%.

Because these are averages, of course, there are some country-specific variations. In Germany, for example, wages stagnated, while in France, they grew. The ultimate takeaway, though, is the same: emerging economies are catching up, and the gap between developed and developing worlds is only narrowing. Engineers in Shanghai or Bangalore can now earn salaries not that different from what they could earn in Paris.

For years, economists have thought that emerging countries would overtake the developed world without the West slowing down. Then, they predicted that developing countries would catch up and we would slow down—a trend that many considered "normal." Today, however, many experts are saying that the developing world is catching up precisely because we are slowing down.

There is, of course, an obvious causal relationship. After all, products like electronic chips and t-shirts are simply cheaper to produce in emerging economies. But this does not explain everything. In France, for example, wage stagnation can be largely attributed to a decline in our own productivity.

So, is this necessarily good news? In principle, yes. The West welcomed worker strikes in China's Foxconn factory, where a worker earns just $300 a year. And, with rising salaries, outsourcing will become less profitable for many Western economies, meaning Europe and America will have to develop their own domestic labor force.

But many Western companies are still moving to countries like Cambodia or Indonesia, where labor is still cheaper than in China. Prices for t-shirts and televisions, meanwhile, will continue to rise for European consumers.

Though this trend could be reversed, it won't be easy. Even worse is the fact that the West must now rejoice: for the rest of the world.

Read the original article in French

You've reached your limit of free articles.

To read the full story, start your free trial today.

Get unlimited access. Cancel anytime.

Exclusive coverage from the world's top sources, in English for the first time.

Insights from the widest range of perspectives, languages and countries.

China

How China's Mass Protest Took The World By Surprise — And Where It Will End

China is facing its biggest political protests in decades as frustration grows with its harsh Zero-COVID strategy. However, the real reasons for the protests run much deeper. Could it be the starting point for a new civic movement?

Photo of police during protests in China against covid-19 restrictions

Security measures during a protest against COVID-19 restrictions

Changren Zheng

In just one weekend, protests spread across China. A fire in an apartment block in Urumqi in China’s western Xinjiang region killed 10, with many blaming lockdown rules for the deaths. Anti-lockdown demonstrations spread to Beijing, Shanghai, Wuhan, Chengdu and other cities. University students from more than half of China's provinces organized various protests against COVID restrictions.

Why and how did the movement spread so rapidly?

At the core, protesters are unhappy with President Xi Jinping's three-year-long Zero-COVID strategy that has meant mass testing, harsh lockdowns, and digital tracking. Yet, the general belief about the Chinese people was that they lacked the awareness and experience for mass political action. Even though discontent had been growing about the Zero-COVID strategy, no one expected these protests.

Keep reading...Show less

You've reached your limit of free articles.

To read the full story, start your free trial today.

Get unlimited access. Cancel anytime.

Exclusive coverage from the world's top sources, in English for the first time.

Insights from the widest range of perspectives, languages and countries.

The latest