The NAM’s report Labor Day Report the effects of a tight labor market, as 82 percent of the private-sector workforce has received real wage gains over the last four quarters — 95 million American workers. This is the broadest wage gain since 2000. A headache for employers seeking to fill jobs, but good news for employees.

Elsewhere, from today’s New York Times:

Chinese wages are on the rise. No reliable figures for average wages exist; the government’s economic data are notably unreliable. But factory owners and experts who monitor the nation’s labor market say that businesses are having a hard time finding able-bodied workers and are having to pay the workers they can find more money.

And higher wages in China are likely to lead to higher prices in the United States — at the mall, at the grocery, even at the gas pump.

Well, that’s the way it’s supposed to work, isn’t it?

The fact that supply-and-demand is allowed to work in China is, historically seen, an astonishingly positive and world-changing developmenet. Just 35 years ago, China was in throes of the murderous Cultural Revolution, where even broaching the topic of free-market economics could land you in prison or a “re-education camp,” or simply dead.

This news could not have happened 35 years ago:

Caterpillar Inc., in a move that underscores the extent to which the Peoria-based company is benefiting from burgeoning Asian demand, disclosed plans Tuesday for a new Chinese manufacturing facility that could turn out as many as 100,000 diesel engines a year….[snip]

In contrast to U.S. manufacturers that simply use China as a low-cost manufacturing platform for goods that will be sold in North America, Caterpillar’s Asian production plants primarily manufacture goods for sale in Asian markets.

It’s a better world today.