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but also in the white-collar labor force. Technology companies such as Microsoft, Intel, and Google—even after it stopped offering its search engine in China—have embarked on huge hiring sprees or have set up research and development centers there. Citigroup announced it would triple its head count on the mainland within three years to 10,000, not for back-office needs but to cater to local clients. Pepsi, Coca-Cola, and Disney all have announced multibillion-dollar investments. Investment banks like Goldman Sachs are increasing their business in China even as they pare their ranks in New York and London.
    The result is massive competition among employers to hire workers in China—even at the height of the financial crisis, when billionaire investor Warren Buffett declared that America’s economy had fallen off a cliff. It has become so easy for workers to find jobs elsewhere that they job-hop constantly. Desperate for warm bodies, companies are throwing 20 percent or greater salary increases at workers to steal them from other firms, creating huge paydays for executive recruiters and headaches for general managers.
    Bob’s human resource problems are mirrored in company after company. My firm conducted interviews in 2010 with human resource managers and senior executives at Fortune 500 companies. More than 70 percent of respondents said they had annual employee turnover of 30 percent or higher. Nearly 90 percent of the companies reported that their biggest obstacle to growth in the coming five years was not the topics the Western media reports about all the time—corruption, copyright infringement, and rising protectionism—but the ability to recruit and retain talent. In comparison, an 11 percent turnover rate in America is considered way too high and detrimental to business.
    One Italian general manager of a small production facility making furnishings and accessories for retail stores told me over lunch that 50 percent of his factory workers leave within two months, no matter how much training and pay he offered them. There was always some factory owner who would offer a little more, even for unqualified workers, because demand for warm bodies was so high. The lack of trained workers was hurting his ability to hit growth targets and meet client demand for products. He was so frustrated, he could not sleep at night and was smoking more.
    A New Zealand factory owner, who had facilities in southern China that produced electronic road signs, told me he took 10 employees to Dubai as part of a retention strategy. It failed, he said, because in job negotiations with other firms, they all touted that they had been to Dubai to demonstrate that they were worldly, globe-trotting executives. Within three months of the Dubai trip, three of the employees had left. He was shutting many of his factories in China, and looking to markets like Mongolia, where employee turnover was less of a problem and costs were stable.
    As I made my way to the Laura Furniture factory dining room, Bob outlined more of the problems his company was facing. Aside from labor costs going up, he explained, the declining U.S. dollar was further eroding margins and hitting his business hard. Because Laura’s factories are all overseas, a declining dollar means his input costs for production in China or Vietnam are going up, while the end price to American consumers is staying the same, or even dropping as he has to discount more to get Americans to open their wallets. Homeowners were putting off buying new furniture, and in all his decades doing business, he had never seen American consumer confidence so low.
    It is an understatement to say he was angry at the calls of U.S. government officials (like New York Senator Chuck Schumer) for China to let its currency appreciate, or that he was frustrated with Federal Reserve chief Ben Bernanke’s decision to increase the money supply through quantitative easing. These wrongheaded policies, he said, just caused