By . Over the past decade many Americans became convinced that China’s economic rise came at their expense. The outsourcing of manufacturing jobs to take advantage of cheap Chinese labor was perceived as having contributed to stagnating middle class wages and the large bilateral trade imbalances. While the logic was always a bit tenuous, China’s cost advantages have eroded in recent years with manufacturing wages having increased by 70 percent since 2009. This has allowed the United States to claw back some production, although most of China’s lost manufacturing has gone to lower cost sites in developing Asia. Yet China’s challenge to America’s economic dominance may not be over, having simply shifted from an abundance of low-skill labor to a glut of college graduates. More...