Rapid aging strikes the Asians with a triple bind: First, aging workforces may typically be more productive, but they are also more expensive. China’s low-skilled labor supply peaked in the early 2000s. China’s skilled labor supply is peaking at the time of this writing. The end result is as clear as it is unavoidable: higher labor costs. China is no longer the low-cost producer, and it hasn’t moved up the value chain fast enough to be the high-quality producer.
