One of the main factors in plant location decisions for international manufacturing companies is the cost of labor.However, the cost of labor is not a static parameter since the presence of multiple companies in a new regionincreases the competition for limited labor availability. This, in turn, increases labor turnover and labor cost. In thispaper, we use the case of Mexican Maquiladoras to review the impact that the presence of new industrial plants haveon wages and labor turnover and to highlight that companies should consider the dynamic aspects of industrialemployment to make plant location decisions.
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