OT: iphone factory life....

[ultraman6970]

Very interesting because if we get those phones produced in the US, they could cost like 5000 bucks each hehehe... not an apple fan myself, they figure it out how to sell you useless stuff and feel great about it

http://www.businessinsider.com/man-s...as-like-2017-4

[icepick_trotsky]

I actually have read that domestic production would increase costs a lot less than you'd think. The main reason for Asian production is that all of the supply chain of competent manufacturers are there and can react more quickly to production changes.

[tylercheung]

yes, there's a lot of infrastructure investment in these things that has not been matched in the US. Granted, over there, it's a brutal race to the bottom in terms of margins for these parts, so it's not an easy thing for individual companies in Asia to survive there.

[benb]

It seems like it'd take 20-30 years to bring the production/supply line back here, and it would be heavily, heavily robotic, but I'd tend to agree maybe it wouldn't be as expensive as we think.

My first internship was in 1995.. the company was still assembling hardware (network equipment) in the US at that point.

All of the placement of chips onto boards and the soldering was robotic... and that was 1995.

And they sold all those robots and shipped all the hardware work to china by 1996 when I went back for a second summer, cause it was cheaper to have Chinese workers do it by hand than do it with robots in Massachusetts. (the software side never left the US)

[johnmdesigner]

The US and Asia are two completely different work mentalities and different sets of rules concerning safety in the workplace.
Remember how hard it was to get US workers to build Japanese cars here?
Remember the Foxconn explosion from aluminum dust in the factory where the Iphone housings were being polished?
Do an online search and see how the workers lives have been affected by an industry with virtually no regulation.
I don't think you could duplicate that here without considerable change and considerable cost.

[bicycletricycle]

I would be interested to see what that $450 dollars gets a person in that economy, seems like that housing was included so I guess they have $450 in cash per month to spend. I have to say that the conditions were better than I expected but not obviously super great.


The cost of labor really does raise the price of manufactured goods in the US. It is true that you can bring that price back down with robots, but then you are really bringing back a lot less jobs.

A client I have makes a relatively simple product both here and in China, both in factories it owns. It is mostly made of molded plastic components and has a few minutes of assembly time.

It costs twice as much to make it here! The plastic costs the same, it is made on the same machines and in similar molds. The labor is the difference. They could redesign it to be less complex to assemble and add some robots to help bridge this gap, but not all the way(some of those improvements would help the china cost as well) , unless you plan on huge import taxes that is just a road to going out of business. Unless people start spending considerably more money on made in the USA products.

The consumer has a lot of power in this situation.

[johnmdesigner]

Originally Posted by bicycletricycle

I would be interested to see what that $450 dollars gets a person in that economy, seems like that housing was included so I guess they have $450 in cash per month to spend. I have to say that the conditions were better than I expected but not obviously super great.


The cost of labor really does raise the price of manufactured goods in the US. It is true that you can bring that price back down with robots, but then you are really bringing back a lot less jobs.

A client I have makes a relatively simple product both here and in China, both in factories it owns. It is mostly made of molded plastic components and has a few minutes of assembly time.

It costs twice as much to make it here! The plastic costs the same, it is made on the same machines and in similar molds. The labor is the difference. They could redesign it to be less complex to assemble and add some robots to help bridge this gap, but not all the way(some of those improvements would help the china cost as well) , unless you plan on huge import taxes that is just a road to going out of business. Unless people start spending considerably more money on made in the USA products.

The consumer has a lot of power in this situation.

There was a survey a while back about the cost of a pair of pants.
I think they were about $10 more if manufactured in the US.
The consensus was "no way would I buy that."

Very hard to convince the US public to stop buying imported $5 tee shirts and $10 pants.

[bicycletricycle]

Yes, I think that the cost barrier is a really difficult problem. The global economy is probably not going away soon. If we are going to compete with 3rd world labor rates we will need-


A higher price ceiling provided by the consumer.

or

Huge import taxes (good luck with trade war)

or

Wait until the economies that are being exploited for cheap labor rise to a higher quality of life and become less competitive (Japan,Taiwan). The problem with this plan is that their will probably always be some low quality of life country to exploit for cheap labor.


The most direct way to start to solve this problem is increased consumer demand, not sure how this happens exactly.......

Originally Posted by johnmdesigner

There was a survey a while back about the cost of a pair of pants.
I think they were about $10 more if manufactured in the US.
The consensus was "no way would I buy that."

Very hard to convince the US public to stop buying imported $5 tee shirts and $10 pants.

[mistermo]

Originally Posted by johnmdesigner

There was a survey a while back about the cost of a pair of pants.
I think they were about $10 more if manufactured in the US.
The consensus was "no way would I buy that."

Very hard to convince the US public to stop buying imported $5 tee shirts and $10 pants.

Don't blame only the consumer. A different way of saying the same thing would be to convince owners/investors to take $5 and $10 less in profits.

[alterergo]

To be honest, I don't think the US needs lowering of minimum way to "sock up" unemployment. That is only fine if

1) as long as it works and there is not much evidence for that. recall you are not only affecting guys "at the margin" (who are getting a job in the case where they otherwise won't with higher min wage.) but you also lower wages for all workers in this skill/experience category. the "macro" effects still operate (btw, poor people spend very little on foreign produced goods)

2) the only alternative is to kick guys on the street. i don't think that is the most useful way to think about this problem. what about retraining programs? helping people to re-enter workforce by equipping with better skillset? or remove excessive constraints on (or encourage) new small shops to open up, start-ups. That is more of the European approach. It isn't a panacea, but when done properly it has much bigger potential.

My view is that focusing on creating better opportunities (higher paying jobs) in the future for currently unemployed is the way to go. You can do it by e.g. better retraining programs that "upgrade" workers with useful skills in current workforce (programming, etc.) is the way to go, not by lowering min wage.

[bicycletricycle]

Yes, lowering min. Wage universally would bring pay down in other min. Wage jobs.

"Retraining" for jobs is something that always sounds nice but I think when you actually think about it it is a little bit of a utopia. If these are free government programs then the chances that they actually train people for something that is actually needed and in a timely manor even a majority of the time seems unlikely. That is why factories used to train people in house, that is why people are willing to take unpaid internships, raising the cost of labor means that companies are less likely to take in untrained labor and invest in them themselves (requiring retraining programs that no one wants to fund and that are unlikely to do as good of a job). Also, a lot of people who have done one job for most of their life can't just be retrained to do something totally different. Your average 50 year old homeless coal miner/contractor/factory worker can not magically turn into a computer coder. People have histories, they have skills and they also have handicaps. How are people going to go from broke to small business owner? Not everyone is an entrepreneur, in fact, very few people are.

The multi generational household used to help get people like this back onto their feet, or at least keep them off of the streets. I don't know if the government or corporations can take its place.

I don't think that moving below minimum wage phone factories to the states is a magical solution to anything, but having some work like this around doesn't seem like it would be the worst thing either.

Originally Posted by alterergo

To be honest, I don't think the US needs lowering of minimum way to "sock up" unemployment. That is only fine if

1) as long as it works and there is not much evidence for that. recall you are not only affecting guys "at the margin" (who are getting a job in the case where they otherwise won't with higher min wage.) but you also lower wages for all workers in this skill/experience category. the "macro" effects still operate (btw, poor people spend very little on foreign produced goods)

2) the only alternative is to kick guys on the street. i don't think that is the most useful way to think about this problem. what about retraining programs? helping people to re-enter workforce by equipping with better skillset? or remove excessive constraints on (or encourage) new small shops to open up, start-ups. That is more of the European approach. It isn't a panacea, but when done properly it has much bigger potential.

My view is that focusing on creating better opportunities (higher paying jobs) in the future for currently unemployed is the way to go. You can do it by e.g. better retraining programs that "upgrade" workers with useful skills in current workforce (programming, etc.) is the way to go, not by lowering min wage.

[bicycletricycle]

Originally Posted by mistermo

Don't blame only the consumer. A different way of saying the same thing would be to convince owners/investors to take $5 and $10 less in profits.

Many goods don't have enough margin for that to be an option.

[mistermo]

Originally Posted by bicycletricycle

Many goods don't have enough margin for that to be an option.

Understood and agreed. Point remains, that it's not merely consumer demand for lower priced items that drives production to cheaper sources, but also investor demand for higher margins. These forces work together. Can't place blame one without the other.

[benb]

There was a recent NPR show I heard, and there is a big news article/book somewhere else about it, but basically Alabama has set up an industry almost like the Chinese factories here for the parts supply chain for foreign auto companies that build cars here in the US. E.x. Mercedes-Benz, BMW, Hyundai, Honda, Kia, were all mentioned.

The actual auto assembly plants that are owned by those foreign companies are good jobs and they have good plant safety. But the parts are all farmed out to a supply chain industry where the workers effectively make less than minimum wage, work way more than 40 hours a week, and safety conditions are as bad or worse than China. The supervisors, managers, safety crews, etc.. are all foreigners and they don't necessarily care about their poor American line workers as much as they should.

So it's not like thing are necessarily better here. There was a lot of info in the article about how Alabama actively worked to set this up and looks the other way, even doing things like minimal spending on education to make sure there are lots of folks who have little choice but to go work in these factories. It's very much the opposite of what other parts of the US or European countries are doing, e.x. Germany where manufacturing workers are valued, their opinions on how to run the line are actually listened to, and the whole state + industry works to train them to be highly skilled. The lack of education also means the companies are having to bring in people from out of the US or out of state to do the higher tech jobs like being safety inspectors and knowing how to work on/repair the robots!

Here is one of the articles:

https://www.bloomberg.com/news/featu...-crushed-limbs

[bicycletricycle]

Originally Posted by mistermo

Understood and agreed. Point remains, that it's not merely consumer demand for lower priced items that drives production to cheaper sources, but also investor demand for higher margins. These forces work together. Can't place blame one without the other.

It is easy to try and hang this all on greed but once a competitor moves off shore and can drastically undercut you in the market often times the choice for companies is not stay and make less make money but rather stay and go out of business.

The consumer has the most direct power in this situation.mThe market will provide anything that we demand.