The low wages in China aren’t the only reason for companies like Apple are manufacturing in China. We tend to forget that so much of the supply chain is already in China. Paul Krugman, NY Times’ columnist and economist, makes a very good point here:
He notes: “Germany remains a highly successful exporter even with workers who cost, on average, $44 an hour — much more than the average cost of American workers. And this success has a lot to do with the support its small and medium-sized companies — the famed Mittelstand — provide to each other via shared suppliers and the maintenance of a skilled work force.”
In other words, as he summarizes, “The point is that successful companies don’t exist in isolation. Prosperity depends on the synergy between companies, on the cluster, not the individual entrepreneur.”
And that’s precisely why we want to examine jobs related to the “ecosystem” of technology innovations -- here at www.eetimes.com.
I agree, without a nation wide plan with integrated product development, education, technical training and local markets, we cannot build a self sustaining infrastructure. A society doesn't just happen. Our slash and burn methods no longer work.
If we want a technical competent youth, we need to institute a product ecoology where there are attainable jobs with the requisite challenges that brought most of us into technical fields.
Todays youth need skills and a reason to learn them. Germany has seen this need and have built up their society to support the need.
Then you need to stop Hollywood from portraying technical people as helpless Geeks or Evil Scientists. They need to be the Hero's as the NASA scientists were in the 1960's. We need a new technical dream.
@Junko: This is very interesting topics to deliberate on. For last to two to three years I always think on this and it intrigues me. American society is very determined and can achieve this soon. I see this happening in Engineering Design. I hope, soon happens it in other fields too. I always support this and prefer to purchase item with Made in USA logo.
It's great to talk about longer term objectives such as encouraging youth to enter the sciences, but the short term impact seems to have a higher priority in my opinion. We have a large population of unemployed that are far past their college years, and many do not currently have the ability to even consider retraining in the new technical world. And even if they did, I seriously doubt that many companies will be willing to hire them. I'm sorry to say that age discrimination is very prevalent in our current job environment. I think it really does require an ideological change among businesses, politicians, and many of us. The tragedy is that this very large group of people are the "transitional generation", and need help now. Are we to just close our eyes and ignore the survival of these people who have built our country?
What can be done? Building the kind of manufacturing ecosystem described by Krugman requires years if not decades of investment. Corporations have demonstrated that they are unwilling to invest in training employees or nurturing supply chains. Government can only do so much to create a positive environment for such investment, and there is no way it has the expertise or backing to unilaterally provide a ready to go, trained in the very latest technologies work force and system of suppliers.
At some point, corporations need to return to thinking beyond the current quarter's stock price. They can get what they need if they decide to do the hard work of providing it for themselves.
"At some point, corporations need to return to thinking beyond the current quarter's stock price."
Absolutely agree, but I think the adjustment in thinking needs to be start at the "investor" and "banker" side of the equation. That's where the real push for short term cost savings at the expense of long-term growth.
There are also culture issues. Engineers and scientists are respected in the same level as lawyers and medical doctors in China, they also paid in the same level. The social status encouraged teenagers pursue STEM as their career. But in the US, smart kids go to law schools, medical schools and banker's training schools. STEM is not valued here. The deteriorating of the manufacture industry just reflected that the society didn't think it is important.
As an engineer who has been around the block a few times I have seen a number of trends that need to be addressed both for the good of the companies and the employees. In the old days companies hired and tried to keep engineers, now the hire and fire or just contract out much of the work. This "looks good on the bottom line" but in the long run hurts the company and wears out employees (at the company or not). Companies used to have long term plans (long term for the US being 2 to 5 years), now it seems that this/next quarter goals are given the most value, the result is short term great numbers long term failure. The cost / benefit analysis has been abandoned due to many factors: economy, investors, job market, lack of foresight. What will it take? I am not sure how to get the general culture to adapt, but one thing is for sure: we had better start looking to change before it is too late. One question I do have is: IS it too late? For my future engineering offspring's sake I hope not.
Junko, I see a lot of great comments here. My only contribution might be, who is "giving up," in your article's header?
The individuals who are responsible for off-shoring manufacturing, and increasingly design and R&D as well, haven't "given up" at all. They are in the US, they are continuing these practices for their own (IMO) myopic reasons, and they are unabashed about it.
If there's one catchy, facile way to explain it, I'd say it's a case of corporations having to work at the microeconomic level, compared with government policies, and other topics we're addressing here, which are at the macroeconomic level.
That's what causes the disconnect.
As an aside, I'm possibly deluding myself, but I do not feel that STEM professions are undervalued here in the US. Not a bit. What I do see, though, is some in my profession who go in assuming they are, and then it becomes a self-fulfilling prophecy. If you go into a negotiation giving off this low opinion of yourself, the guy on the other side of the table is sure to take advantage.
The good jobs are not coming back because there is no longer even a hint of corporate social responsibility today as there once was. At one time, America was a nation of morally superior government and business leaders with common sense that put the greater good and long-term success above self-interest and the next election in most decisions big & small. No more. The only thing left is "show me the money". This is the mind set that is keeping us down. Successful companies like Apple are perfectly content to sit on $100B mountain of cash as opposed to adding $60 to the build (not the price) of an iphone to keep America's jobs. This is a perfect example of what has happened across the board in all industries.
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