Manufacturing costs have risen rapidly here in response to nagging labor shortages and worker demands for higher wages to help offset soaring food and property prices.
The authorities also agreed, with only slight modifications, to worker demands for guarantees of free speech, pay raises and official recognition of the Solidarity union.
The comments by Mr. Greenspan suggest worker demands for higher wages are being moderated by the fear of being laid off amid "job skill obsolescence".
But the level of labor unrest in China this year has not yet matched 2010, when a surge in inflation sparked a wave of worker demands for higher pay, Mr. Crothall said.
Cautious of spurning one of its few major revenue sources, the government has a dual interest in ignoring worker demands for fire safety and better wages.
And when the stock market kept sagging, and once-proud industries like telecommunications, technology and investment banking began laying off workers, demand for luxury goods withered even more.
Before they were scheduled to formally resign at the end of May, Honda fired Mr. Tan and Mr. Xiao on May 22. On June 4, after intense negotiations involving the local government in Foshan and Japanese executives, Honda agreed to a large pay raise, though short of the workers' demand for nearly doubling their salary.
Workers' demand for hourly wages is a necessary step to creating pathways out of poverty and building economic security.
Moreover, the Chinese government has been actively supporting pro-labor legislation and workers' demands for better wages and rights.
Simultaneously, pressures were brought to bear on employers to resist workers' demands for higher wages to offset the resulting price increases.
