I’ve said for years that to help reduce the flow of illegal immigrants and lessen our dependence on China we should be putting money into Mexico and Central America. I know some factories have opened there which is a nice start but more of that needs to happen. We’d still get inexpensive goods, but they wouldn’t have to be shipped on freighters across the ocean so it would have to save time and money too. Plus these jobs would improve things so not as many would be at the border.
This canard about China being a low cost, low skilled producer keeps coming up. As if we could throw money at Central America and create the very labor force
we’re lacking.
So I’ll keep posting this comment from Tim Cook (Apple):
“The number one reason why we like to be in China is the people. China has extraordinary skills. And the part that's the most unknown is there's almost two million application developers in China that write apps for the iOS App Store. These are some of the most innovative mobile apps in the world, and the entrepreneurs that run them are some of the most inspiring and entrepreneurial in the world. Those are sold not only here but exported around the world.
China has moved into very advanced manufacturing, so you find in China the intersection of craftsman kind of skill, and sophisticated robotics and the computer science world. That intersection, which is very rare to find anywhere, that kind of skill, is very important to our business because of the precision and quality level that we like. The thing that most people focus on if they're a foreigner coming to China is the size of the market, and obviously it's the biggest market in the world in so many areas. But for us,
the number one attraction is the quality of the people.
I visited ICT--they manufacture, among other things, the AirPods for us. When you think about AirPods as a user, you might think it couldn't be that hard because it's really small. The AirPods have several hundred components in them, and the level of precision embedded into the audio quality--without getting into really nerdy engineering--it's really hard. And
it requires a level of skill that's extremely high.
It's not designed and sent over--that sounds like there's no interaction. The truth is, the process engineering and process development associated with our products require innovation in and of itself. Not only the product but the way that it's made, because we want to make things in the scale of hundreds of millions, and we want the quality level of zero defects. That's always what we strive for, and the way that you get there, particularly when you're pushing the envelope in the type of materials that you have, and the precision that your specifications are forcing, requires a kind of hand-in-glove partnership. You don't do it by throwing it over the chasm. It would never work. I can't imagine how that would be.
There's a confusion about China. The popular conception is that companies come to China because of low labor cost. I'm not sure what part of China they go to, but
the truth is China stopped being the low-labor-cost country many years ago. And that is not the reason to come to China from a supply point of view.
The reason is because of the skill, and the quantity of skill in one location and the type of skill it is.
The products we do require really advanced tooling, and the precision that you have to have, the tooling and working with the materials that we do are state of the art. And
the tooling skill is very deep here. In the U.S., you could have a meeting of tooling engineers and I'm not sure we could fill the room. In China, you could fill multiple football fields.
The vocational expertise is very very deep here, and I give the education system a lot of credit for continuing to push on that even when others were de-emphasizing vocational. Now I think many countries in the world have woke up and said this is a key thing and we've got to correct that. China called that right from the beginning.”