Foxconn's recent decision to increase workers' wages by up to 25 percent is causing problems for other manufacturers in the Far East, it has been reported.
Digitimes claims that other companies in the supply chain are finding that this has already exacerbated the labour shortage problem, with many unable to offer competitive salaries in comparison to those on offer at Foxconn.
This means that competitors are forced to put wages up too, which they are unable to afford, and this could have a serious impact on the supply chain, the report states.
For Foxconn workers in Shenzhen, a major manufacturing base for the company, the increase raises monthly salaries to between 2200 yuan (US$350) and 2500 yuan. Previously, monthly salaries for Foxconn's Shenzhen workers were at 1800 yuan.
The rise was implemented on 1 February, before Apple announced that it had asked the Fair Labor Association to carry out inspections at plants belonging to companies in its supply chain.