> Microsoft’s decision to shift Surface Hub manufacturing to China highlights the difficulty in bringing manufacturing jobs back to the United States. It’s not just a question of opening a factory and hiring employees. There are supply line considerations, source costs, and the simple fact that American companies now produce many more products with far fewer employees than they used to require in the 1970s, thanks to automation and improved productivity.
> American companies now produce many more products with far fewer employees
PSA: You may have heard that American manufacturing is stronger than ever, it has just become automated. This story is largely result of funny accounting.
Which is apparent to anyone who doesn't have their heads stuck in some spreadsheets. Huge American manufacturing sectors (textiles, electronics, home appliances, etc) which were made in this country 30-40 years ago are no longer made here, or are made here in significantly reduced capacity.
So, its possible to talk about how efficient American manufacturing has become, but the average consumer doesn't see that as they walk the isles at Walmart. What they see is that its really hard to find anything actually made in the US. Those of us old enough to remember, _CAN_ remember a time when the clothing at the store said "made in America", or shed a little tear as we remove the 25 year old washer that has a made in america sticker and replace it with one that says made in Mexico or similar.
So, we may be making more planes and john deere tractors, but we definitely have had huge swaths of our consumer goods simply wiped out by cheap labor countries where hiring a half dozen people for 10 years to do final inspections on clothing costs less than putting a robot in a factory in the US.
The problem isn't that factory automation has been on a steady trend of reducing labor since Henry Ford. The problem is that now that those factories are located in cheap labor countries, they are still being slowly automated. So eventually when they reach 100% and the labor costs are strictly the cost of people programming and repairing the machines (see semiconductor fabs) they aren't magically going to move back to the US, rather they will stay in whatever part of the world managed to hold onto them during the final phases and still has the critical mass of supply chain.
Not if they're < 100hp. Those are all made in Japan by Yanmar and rebadged. Ditto New Holland(merged with Ford) which is built by LS. There's not a single company that makes a compact tractor in the US that you can buy.
This is not correct. The Riding Lawn Equipment (RLE) is built in Horicon WI (as are the gators). The compact tractors (one series, two series, etc) are built in Augusta GA. The RLE has almost nothing from Yanmar in it except the diesels use a Yanmar engine. The sub-CUTs and CUTS use a lot of Yanmar components, but are Deere products and assembled by Deere. I have been to both factories and seen the lines in the last few years, they are assembling tractors there.
Not sure why you're talking about RLE and Gators as I was only talking about compact tractors.
You could say the same think about Kubota as the assemble their B/BX models in the US(they however don't outsource the engine).
There's nothing wrong with sourcing an engine/design from another company, however if you do that's definitely not something made completely in America. JD likes to play this up heavily in their marketing and honestly I find it to be a bit disingenuous.
A Deere X700, which is made in Horicon, is a <100HP tractor. They are real tractors with an optional PTO and 3-pt hitch. No tractor in the world is entirely made by a single company. For starters they all have various semiconductors in them and no tractor company owns a fab that I am aware of.
Deere engineers in Augusta design their current CUTS, they are built there and tested there. Yes, they use parts from many suppliers.
You can get a PTO and 3-point on a telehandler, doesn't make it a tractor. What you're talking about there is a riding lawn mower.
I also didn't say that there's any company that makes all their parts in-house. Just that you can't find one made in America despite a fair bit of advertising that leans that way.
I have a fair idea of what I'm talking about. On our property we have a Ferguson TE-20(a tractor that was all made in one country), Ford 1500(which is a joint venture between New Holland, Shibaru and licensed by Ford) and a Kubota L4760(in-house engine development).
Re: semiconductor fabs. It is interesting to note that US still holds a lot of cutting edge semiconductor fab capacity, at Oregon, Arizona, and New York.
Almost all of the high-value parts of an iPhone are made in the US. Yet there is a lot of hand-wringing about the low-value, labor-intensive work done on iPhones in China.
Not sure I make the same bet. Generally you don't outsource your core competencies. Design and software are Apple's core competencies. Assembling hardware is not.
Which ones? Screen, flash memory, CPU, DRAM, battery come to mind. All of these product types are also manufactured in the US, but not the majority of the output.
The ones I've seen never show the US as the biggest slice, but China is always a sliver and the chart is usually dominated by Germany, South Korea, and Japan.
Exactly. And that analysis is of components, so it leaves out the value of ecosystem, software, and Apple’s cpu and SoC design groups, which is bigger than all of the components combined.
Is there any problem at all, really? Humanity gets more and more efficient at allocating jobs and then at removing the need for human input at all. It's only a problem for people who cannot contribute to humanity in any way but repetitive manual labour, and while I genuinly tried, I can't feel sorry for them. You don't even have to have a high IQ for a different kind of a job - there's a LOT of jobs that require social intelligence and empathy instead of intelligence that are even less prone to automation than software development.
It's not really funny accounting when dollars is a relatively normal unit of measure. It's that if you choose to measure in dollars output is high, but if you were to measure in terms of pounds or cubic volume it's dropped.
The "strong USA manufacturing" narrative took Intel's profits, multiplied them up by Moore's law, and used the result to hide the fact that everything else has imploded.
It isn't mentioned in the article, but I think it would be reasonable to suggest that a 25% tariff on nearly every component that goes into these devices might have impacted the decision. The alternative is to manufacture the device outside of the US and then importing the completed device with no tariff applied.
Trump's economic policies are doing the exact thing everyone suggested they would, forcing modern manufacturing in the US to move elsewhere or face a 25% increase in component cost across the board.
It is so sadly funny that the strongest economy in the world can be manipulated so deeply this fast and nothing happens. This makes me want to read more about the Mongols, Romans, and Persians history. This must be a great time to do analytical research on how to measure manipulation of the mainstream opinions about well anything. I like to see some good simulators on the matter. Maybe gaming industry can help!
There is a lot of historical data on it already. Also in markets much more similar to modern markets, but it’s important to keep in mind that things are different depending on the period.
Today the most valuable parts of a country isn’t raw materials or factories, but know-how, and know-how is a lot more mobile than any other resource.
Romans faced a different threat, in that their biggest resource was the materials and the factories, and because of that, they didn’t want one region to have access to all of it. So they made their weapons in a different place than their food source.
I don’t think protectionism or nationalism has ever really worked though. You mention the Roman Empire, but it thrived the most when it was the most inclusive, tolerating every region and culture as long as they all paid their taxes on time and accepted everyone else. One of the key reasons the Roman Empire originally was so tough on Christianity and Judaism was because the monotheisms didn’t accept others.
I think it’ll be alright though, America has been through worse than Trump and the alt-right.
The documentary The Thirteenth mentions Microsoft (among many other companies) US uses prison labour - which allows the company to pay workers a pittance which is viewed as being a type of exploitation. After this was exposed, a few similar companies (Victoria's Secret) stopped doing this. Has Microsoft?
> Please don't impute astroturfing or shillage. That degrades discussion and is usually mistaken. If you're worried about it, email us and we'll look at the data.
Like with climate change, it's already too late.