I had the opportunity to listen to a "hard asset" hedge fund manager the other day. "Hard asset" managers typically have a focus on inflation as a benchmark to beat, and spend a lot of time thinking about the when, where, why and how much aspects of inflation. One interesting point she made was about wage inflation in China.
High wages in the US have "sent American jobs overseas" to cheaper countries. In 2001, the average manufacturing wage in China was $0.58/hour. Making things there kept it cheap for Americans to buy things, even considering the cost of transport (low with today's efficient freighters). The hedge fund manager said that wages are nearing $5/hour. While I couldn't find a number that high, most sources cite 15-20% annual growth in wages, and hourly wages around $4 currently.
Some of the jobs in China will go to countries that are cheaper still, Cambodia and Mexico are two beneficiaries of this trend. America is still the worlds largest consumer, however, and plenty of businesses are choosing to keep factories open, or open up new ones here, so long as they can find willing and able labor.