Working Conditions in China...

[Mike Archambeau]

Did any of you actually read the articles cited here? There is a very important point regarding why things are made in China that has nothing to do with cost and that is flexibility and adaptability. There is no way that any plant in the US would be able to switch gears and ramp up product on the scale that is required for a global roll out of a new, high demand product. 400,000 workers at that Foxcomm plant, guys. 400,000 who are willing to work long hours for days on end because that is a better option than their alternatives. 400,000 people willing to be woken up at night and told "time to go to work, we've got to make more gadgets so you're working overtime." You could probably find pockets of folks here willing to do that, and we all certainly know farmers, ranchers, or small business owners who work 16 hour days for months on end. But to be able to assemble nearly half a million of that kind of worker in one place is something that can only be done in a country with a billion candidates who are willing to relocate. The logistics advantage and the reduced time to market that this kind of arrangement allows should not be underestimated. I don't understand why we all seem to lament the fact that making some things elsewhere just makes more sense. I don't do drywall anymore because other people can do it better and faster than me. I'm happy doing things that I am better at, that I enjoy more, and that are more profitable in the first place.

Gee sounds like life in the US Military. Sailors sleep in bunks in rooms with many other sailors. They can be roused in the night for duty. They work for room and board and a modest paycheck. And believe it or not they are very flexible and adaptable which is why you don't want to mess with them or they will kick your butt. So how is it that when it comes to snapping and screwing together some circuit boards and some plastic parts, that the US companies think that a 13 year old child in China is better suited for the challenge. Jeez I really must be missing something here........................sigh.

[Mike Archambeau]

http://blogs.hbr.org/haque/2009/07/a...t_would_i.html

Above is a simple article with a guesstimate of what a fair labor Ipod would cost. 23% more, or $58 more. I have to ask myself, if people are going 10 miles down the road to buy gas for a penny per gallon less, what would they do if an American made and Chinese made Ipod lay side by side? The American made Ipod is $58 more; which would they buy? I'm guessing over 80% would buy the chinese version, based on my wife's experience as a cashier in a department store.

That is only half the problem. As the original posted article states, there are no longer enough middle level workers in the US to produce the quantity of goods that are consumed. Everybody has a college degree and thinks they should earn $2 billion per month.

In a few years when the cost of labor in China rises, as it surely will, and the cost of oil rises, which it surely will, the cost of assembling and shipping from China and then selling into the USA will rise to the point where it will no longer be a working proposition. In the meantime I think I can make due with my current phone and computer. But my finger is getting sore spinning that rotary dial, so could you hurry it up a bit......

[Ben Hatcher]

Gee sounds like life in the US Military. Sailors sleep in bunks in rooms with many other sailors. They can be roused in the night for duty. They work for room and board and a modest paycheck. And believe it or not they are very flexible and adaptable which is why you don't want to mess with them or they will kick your butt. So how is it that when it comes to snapping and screwing together some circuit boards and some plastic parts, that the US companies think that a 13 year old child in China is better suited for the challenge. Jeez I really must be missing something here........................sigh.

It isn't a matter of capability to do the job. There's a huge speed and flexibilty advantage in having your entire supply chain under one roof or at least in close proximity. Doing that requires a huge labor force. Only a small percentage of the labor force is willing and/or able to do that kind of work. The 400k at Foxcomm is only part of the 22 million in Shenzhen...a city that was didn't exist 20 years ago. What I'm saying is that China and other hugely populated countries are uniquely positioned because they posess the sheer number of people willing to not only do the job but to relocate so that there is a sufficient concentration of the right kind of laborers needed to staff that kind of factory.

[Mike Archambeau]

So I have this car that was built waaaaay back in 1995. It is a German car, has served me well for the past 16 years and 150,000 miles. Lately I have been fixing a few things that need attention. Every part that I have taken off the car says "Made in Germany". Since I am very interested in keeping the car original, I always go with OEM parts. Every new part that I have purchased says "Made in Germany". The purely mechanical parts such as fuel pressure regulator, or electrical parts such as fuel pump all were made in Germany. So I looked close to see when the parts were made, and would you believe that they were made very recently......in Germany of all places. So how is it that the Germans figured out how to make all these wonderful parts (and cars for that matter), without resorting to slave labor in China? Then I sratched my head and wondered if that is why so much of Europe is turning to Germany right now to help them with this European debt crisis. Is it possible that the reason the country of Germany has it's fiscal house in order, is the result of keeping full employement by continuing to manufacture in their own country, resulting in full employment, resulting in more citizens paying income taxes, so that the wealth of the German nation is strong? So while some European nations let their jobs be sent to China, then feasted on cheaps imports, their governments borrowed the money they needed to operate becuase they no longer collected income taxes from workers whose jobs evaporated and magically appeared in China. Then one day the country can no longer pay their bills so they look to a strong Germany. And guess what.....Germany is just doing what they always did. Come to think of it that is what the USA always did as well.....until we sent those silly little jobs overseas. Twenty years ago Ross Perrot said "That giant sucking sound you hear is your job being sent overseas" Guess we should have paid more attention to what he was saying.......or we could just take a close look at what Germany is still doing. Sigh......


Next time I get ready to buy a new car I car am going to get real friendly with the best sales guy at the dealership. Then the two of us will go visit the parts counter at the dealership. We will have the parts guy pull a few parts, like a fuel pump, an alternator, or a water pump. If the parts say made in PRC or China etc, I will thank the salesman for his trouble and move on. So like JC from CT says....time to vote with our dollars............

[David Weaver]

As a person who also owns a german car, and also buys those german parts....they are extremely expensive.

Germans have no stomach for parts made in china, they are willing to pay the additional cost to have them made in the country. In the US, that's not the case. Thus the situation.

[Ben Hatcher]

Germany is actually a very good case study for what I think we should look to do in the US. They had huge unemployment problems when reunification happened. Their government worked closely with business to disuade companies from moving jobs overseas through tax codes and education reform in order to supply the industries with the training and labor force they needed to compete. They're also not making consumer electronics, but focus on highly specialized and high margin products.

[Joel Goodman]

Has anyone read this article in the Atlantic Monthly?

http://www.theatlantic.com/magazine/...e-things/8839/

It's about a political science prof at University of Chicago and why he believes our biggest threat in the future is China -- food for thought!

[Joe Angrisani]

There are some services that can't be "farmed out".
Farming, for one......

Really???

(As I munch on my New Zealand apple, Mexican blackberries and Chilean blueberries. And recall a recent trip to Florida where the orange juice box said 'Product of Brazil' [in FLORIDA, for crying out loud!!])

[Hilel Salomon]

First of all, the idea that we don't manufacture anything in this country is simply not true. We make some and assemble others in the automotive industry. We make motorcycles and assemble chainsaws, guns, and a host of other items. Some people want to blame the government entirely for our current state of affairs, but it is in a communist country (China) where the government simply creates industrial towns and draws upon a population still struggling with hunger and a host of other problems. I don't blame Americans for refusing to work for less than $30/a day, 12 hour shifts, under deplorable conditions. What we have in this country is corporate greed gone amok. Corporate CEO's make more in the US than in any other industrialized nation. Not just a little more, but obscenely more and this is whether or not their company does well. The CEO to worker income ratio in this country is ridiculous.
Another factor, which the article didn't cover is the fact that these corporate heads make deals with China, knowing full well that the Chinese demand to have access to the technology (which we have developed). Sooner or later, the Chinese and/or Indians can cut off the American corporation and make their own stuff. By that time, the people who have-essentially-sold out their own companies will have retired as mega-millionaires. It's not just America and its people that these greedy types don't care about. They really aren't concerned with the long term interests of their own companies. Tricklye down economies simply don't work for anyone but the ultra-wealthy.
If companies want to go overseas in order to avoid paying social security taxes, health care costs and retirements, their goods need to be taxed at a higher rate than those companies which have some national conscience.

[David Cramer]

[QUOTE=Phil Thien;1864215]Taken individually, it makes financial sense for manufacturers to off-shore production.


I think I mentioned before when I was in a Home Depot and they have someone from a survey outfit asking a guy back in the electrical department why he selected a Klein tool. "Made in U.S.A." was one of the multiple choices, and he did pick that (among familiarity with the product).

So they are not immune.

I just had a choice last week to buy some cheap overseas nut drivers, or 7 high quality Klein nut drivers for $49.99. I chose the Klein and have not regretted it. To me it was a smart purchase that I will have for a long, long time...no repurchasing a new set in 5 years. I always look at the label and do the best I can.

David

[Pat Barry]

Truely American companies they would invest in America, not invest in China at the expense of America's future.

[Pat Barry]

I agree with a lot of what you say here. Everyone wants the cheapest price for everything they want to buy. But America cannot sustain a viable future by outsourcing everything. At least for a while our fast food will be produced here and then there all those retail sales jobs s to pick from. I think American companies, like Apple, need to hold themselves to a high standard and use their ingenuity to make made in America a viable concept again. Most consumers don't see it that way. They don't see the erosion of the job market apparently. They think of themselves as victims. How do you get America at large to be upset about this and demand change?

[Pat Barry]

Blame the consumer - really? Do you blame the squirrel you run over on your way to the store? T

[Kevin W Johnson]

It isn't a matter of capability to do the job. There's a huge speed and flexibilty advantage in having your entire supply chain under one roof or at least in close proximity. Doing that requires a huge labor force. Only a small percentage of the labor force is willing and/or able to do that kind of work. The 400k at Foxcomm is only part of the 22 million in Shenzhen...a city that was didn't exist 20 years ago. What I'm saying is that China and other hugely populated countries are uniquely positioned because they posess the sheer number of people willing to not only do the job but to relocate so that there is a sufficient concentration of the right kind of laborers needed to staff that kind of factory.

So, Foxconn is a minority example of needing a very large and concentrated workforce. Most manufacturing doesn't require this, and can be handled here, at home. What we need as a country, is a level playing field with the rest of the world (asia, particularly) and an atmosphere that is business friendly with less taxes, less red tape, and sensible regulation.

Furthermore, if we had less nanny-state here at home, we'd have more people willing, er, having to work lower paid jobs.

[Bill Edwards(2)]

Blame the consumer - really?

Who do you want to blame?

The invading army that's taking out our intrastructure?

The rioting fanatics who killed the czar and his ministers (more's the pity)

We have only to look in the mirror to find America's woes.