Y'all are in for it now, I've got a "2nd cup of coffee morning bend" festerin' up in me... :nunu:
Many times when I should know better, I try to figure out what the phrase "global economy" means. Something that caught my eye recently is this gem. Intel (the chip company) has to build a new plant for their chips every few years as they get the line sizes (smallest geometry they can make) down and therefore the circuit density goes up. Well, for their next plant they are looking at Viet Nam. China is too expensive.
So I think that 20 years ago it was Japan, then Korea, now China, soon Viet Nam. There is always some emerging country that has cheap labor, low mandatory per worker costs (unemployment, health care, retirement, vacation, maternity leave, etc) and lower environmental costs. And these countries have a wide range of quality. High when the contractors specs are high, supervision is high, and testing of incoming product happens. Low if it's a bunch of MBAs buying solely on price.
And for what it's worth, we invented this game in the US. There is a company in this area that makes axles for cars. The ones made for a Japanese company cost more. They have tighter specs and tolerances, and have to change the tooling out more often to keep it tolorance. The axles made for a domestic manufacture have lower tolerances and cost less. Side note: When I'm around machinists, I always say "slop" instead of "tolerance" just to rile them up a bit. I know, hard to believe I'd do that :mocking:.
Anyway, the textile mills in the north moved work to the south because labor was cheaper (and that's not slave labor, that was paid labor). Labor laws in Massachusetts increased the cost of workers, and the textile mills were getting in trouble for polluting the rivers.
So while I agree with the chinacom comments, regrettably this is nothing new. And to a degree the US brings this on ourselves with our WallMart "race to the bottom" mentality. Buying things at a price so low that the products can't be made in this country. Couple that with increased benefits and protection for workers from both government and unions and is it any wonder we've price manual labor intensive production overseas. The best of intentions as far as taking care of people, but simple economics says the more you help the more you hurt. If this were an equation, there would be a peak point where worker benefits balance worker cost and domestic production is maximized.
I'd love to go on about how automation of factories and a better trained workforce is key and pontificate on the meaning of what a "service society" is (Hint: Making money doing each others laundry). But I'll stop here. Disappointed but not surprised by this trend, I think this is why the middle class is going away, and I have no idea how to fix it.
But yeah, hey, too much made in China that is of poor quality and too little purchased from the USA because it cost too much (only in the short run, in the long run cheap stuff from China is the most expensive things US citizens buy).
Time for final cup of coffee and then have to get back to my circuit board software (which is written in Australia because US programmers cost too much...) :unknown:.
Pete :morning2:
