"Low-Skilled Jobs: Do They Have to Move?"

Business Week, February 26, 2001

Synopsis:

According to the theory of comparative advantage, U.S. may want to specialize in high-skilled jobs and allow countries with cheaper labor force to perform low-skilled work. Introducing the managerial approaches by New Balance Athletic Shoe Inc, this article explains how it would be possible for U.S. firms to improve low-skilled jobs instead of move them abroad. By adopting the latest manufacturing techniques and teamwork-based approaches, New Balance has slashed the cost disadvantage of producing in the U.S. Compared to its rivals including Nike and Reebok that move to low-wage countries, New Balance is in a better position to fill store orders faster and whip out style changes more quickly. This article also discusses whether New Balance's approaches can be applicable to other U.S. firms that have to offset the vast wage differentials with low-wage countries.

Full-text Article: http://www.businessweek.com/@@N1*tXmUQEkePtwQA/premium/01_09/b3721104.htm

Text connection: Chapter 4 "International Trade Theory" (pp.128-133).

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