Some years back President Obama asked Steve Jobs about all those Apple assembly jobs being done in those vast sheds in China. More specifically, he wanted to know whether those jobs would come back to the United States, was there some way they could be brought back perhaps. And Steve Jobs’ response was simply that those jobs are never coming back. This is not something specific to Apple, nor China, either. Mass employment in assembly of anything is just not something that is ever going to happen in a rich country any more. It’s cheaper to use machines to do it than pay rich world wages. The options here are therefore that either poor labour in poor countries will be used to do such assembly work or machines anywhere will do it.
At which point we’ve the news that Foxconn is attempting to roll out robots in all of its factories in China. Foxconn being one of the contracting companies that assembles that electronic iKit for Apple as well as for many other such producers of electronic gew gaws.
Foxconn Electronics is automating production at its factories in China in three phases, aiming to fully automate entire factories eventually, according to general manager Dai Jia-peng for Foxconn’s Automation Technology Development Committee.
There’s something important to know here about the costs in these factories. Chinese manufacturing labour earns around $6,500 a year at present. That’s after we adjust for price differences in China and the US. That’s $3.25 an hour for something like the regular US working year. The Chinese work longer hours for that amount. Last I looked wages for electronics assembly in the US were $14 an hour or so.
It simply is never going to be true that there will be large sheds of hundreds of thousands of people assembling Apple, or any other electronic kit, in the United States.
The first phase of Foxconn’s automation plans involve replacing the work that is either dangerous or involves repetitious labor humans are unwilling to do. The second phase involves improving efficiency by streamlining production lines to reduce the number of excess robots in use. The third and final phase involves automating entire factories, “with only a minimal number of workers assigned for production, logistics, testing, and inspection processes,” according to Jia-peng.
One phrase used to describe that last phase is a “dark line.” One where it is possible to save on the expense of lighting as the machines don’t need it and there’re no humans in the process who do. They have already achieved this in China on certain specific lines:
Even in China where labor is cheap, Foxconn is beginning to use robots to replace human workers. In the US, a new factory would undoubtedly be highly automated, limiting potential employment. Building iPhones in the US might sound nice, and it makes for good political rhetoric, but it’s not a silver bullet to create jobs.
And that’s the thing. We are simply never, never again in the course of human history, going to use rich world labour to do this sort of assembly work. There are still places out there where human labour is cheap enough–Bangladesh comes to mind, Ethiopia perhaps, those sorts of places. Not that they have the supply chains to make it worthwhile but the labour is cheap enough. But if even at Chinese labour rates of three bucks an hour the machines are winning then that’s really the only choice there is.
These things can be made by human labour in the cheapest parts of the world or by machines anywhere else. No, it doesn’t matter what Donald Trump says either–those jobs are never coming back, just like Steve Jobs told Obama. The use of mass labour to do manufacturing work in the rich world is simply gone, it’s a phase of human history that is over.