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I think you and the op are both missing that the vast majority of those mid skilled jobs still exist, they just exist in countries whose labor costs are drastic

I think you and the op are both missing that the vast majority of those mid skilled jobs still exist, they just exist in countries whose labor costs are drastically lower. When you realize that, you then realize that betting that your workers will be able to maintain a quality gap large enough to justify keeping them around is extremely questionable over the medium to long term because you are assuming some combination of there being a difference in your populations at a macro level (almost certainly wrong), that you will be able to innovate quality/other differentiating characteristics fast enough to maintain a large gap (almost certainly wrong, it's way harder to come up with something new vs copying the practices that exist already, especially when it is in the interest of the company in control of those practice to offshore for more profit), or your government will always be better in the specific subset of ways that maintains an advantage (better infrastructure, better regulation, etc. Also wrong when environmental regulation is at odds with profits and infrastructure only needs to be good between the factory and the port). The better strategy is what everyone else has been doing, letting the third world catch up in labor costs for a few generations while ensuring you maintain the design capability. This does more than any ngo ever to decrease poverty and suffering, it will mean at some point in the future your labor won't be so starkly uncompetitive so eventually you can bring some manufacturing back, and it makes it less likely that the best and brightest arent' wasted on subsistence farming/made less due to childhood malnutrition in the third world, which should help us innovate faster in the future.

scrubs 3y ago
Well argued snapplebobapple. Japan isn't cheap anymore; and neither will China be either in the long run
JKCalhoun 3y ago
I'm not sure waiting for the rest of the world to catch up is a good strategy as there always seems to be somewhere else that is still willing to work for less. I suspect if manufacturing ever did come back it would be automated manufacturing.
- snapplebobapple 3y ago
  depends on your definition of a good strategy. None of the options are good for overpriced manufacturing labor in the first world that doesn't want to retrain/can't retrain. Most of the options are good for the whole world, because manufacturing with less expensive labor usually translate to higher output for lower cost and the labor inflation that causes in the third world is in the really nasty subsistence level of the human suffering index rather than the can't afford a second car and/or the new video game console area of the human suffering index. The benefit to the world of labor price inflation in that level of the curve is so high it's not really comparable. From the perspective of specific first world countries whether it is good or not depends on a mix of priorities from maintaining output capabilities in the face of potential war, maximizing the stuff your populace can get (bread and circuses limit political risk to rulers) and ensuring the spread between the upper and lower ends of society doesn't get so wide that the lower end looks up from its bread and circuses to revolt. Overall it will be a good strategy to move a significant portion elsewhere from this perspective as well.
- nradov 3y ago
  Geopolitics and military affairs can override labor cost issues to a limited extent. The global supply chain that was enabled by Pax Americana after WW2 is gradually breaking down. The US Navy is no longer willing or able to ensure worldwide freedom of navigation and so shipping on some major routes has become slower and less reliable. Sanctions and protectionist measures are fracturing the world into regional rather than global trading blocs. And governments are increasingly willing to subsidize strategic manufacturing industries (especially weapons) in order to avoid being dependent on unreliable trading partners. Of course automation levels will continue to increase as they always have since the Industrial Revolution.
fakedang 3y ago
> I think you and the op are both missing that the vast majority of those mid skilled jobs still exist, they just exist in countries whose labor costs are drastically lower. They exist in lower income countries, but the work quality is often shoddy and poor at best. The talented ones have already migrated to the West. Case in point, a factory we built for a project in the Middle East with a fully European team took just 9 months to finish from the start of laying the foundation stone. Similar projects in the same country by a Chinese or local company would have taken 3-4 years. Another American team executed a project in Singapore in 2.5 years, but that same project was estimated to take 6 years in India.
- snapplebobapple 3y ago
  That's literally point two and three of the argument I made in the second half of the first paragraph as something that is incorrect to bet on continuing forever. What would your project spread have looked like 20 years ago? I am guessing quite a lot worse. What will the spread look like in 20 years? I would bet on it being closer than it is now.
  - nradov 3y ago
    Most Middle Eastern countries have made approximately zero progress on worker training and productivity in the past 20 years. Some have even gone backwards. There's no reason to expect they will do better in the next 20. It's a sad waste of human potential due to toxic politics and unfavorable geography.
    - snapplebobapple 3y ago
      If progress was equal everywhere we wouldn't have all these laggards willing to work for peanuts to improve their life (because the peanuts they were working for locally are even smaller than foreign peanuts). ~5% of the population currently not getting the job done doesn't invalidate any part of my argument. It just means that 5% might be the last guys left in the dark ages if progress continues and the policy of offshoring doesn't reverse (either for political reasons or because we cracked the full automation code and labor costs no longer matter because we aren't using much labor to produce things. If that happens the dirty stuff will still be offshored but the calculus will be different for the foreign country).

scrubs 3y ago

Well argued snapplebobapple. Japan isn't cheap anymore; and neither will China be either in the long run

JKCalhoun 3y ago

I'm not sure waiting for the rest of the world to catch up is a good strategy as there always seems to be somewhere else that is still willing to work for less. I suspect if manufacturing ever did come back it would be automated manufacturing.

snapplebobapple 3y ago
depends on your definition of a good strategy. None of the options are good for overpriced manufacturing labor in the first world that doesn't want to retrain/can't retrain. Most of the options are good for the whole world, because manufacturing with less expensive labor usually translate to higher output for lower cost and the labor inflation that causes in the third world is in the really nasty subsistence level of the human suffering index rather than the can't afford a second car and/or the new video game console area of the human suffering index. The benefit to the world of labor price inflation in that level of the curve is so high it's not really comparable. From the perspective of specific first world countries whether it is good or not depends on a mix of priorities from maintaining output capabilities in the face of potential war, maximizing the stuff your populace can get (bread and circuses limit political risk to rulers) and ensuring the spread between the upper and lower ends of society doesn't get so wide that the lower end looks up from its bread and circuses to revolt. Overall it will be a good strategy to move a significant portion elsewhere from this perspective as well.
nradov 3y ago
Geopolitics and military affairs can override labor cost issues to a limited extent. The global supply chain that was enabled by Pax Americana after WW2 is gradually breaking down. The US Navy is no longer willing or able to ensure worldwide freedom of navigation and so shipping on some major routes has become slower and less reliable. Sanctions and protectionist measures are fracturing the world into regional rather than global trading blocs. And governments are increasingly willing to subsidize strategic manufacturing industries (especially weapons) in order to avoid being dependent on unreliable trading partners. Of course automation levels will continue to increase as they always have since the Industrial Revolution.

fakedang 3y ago

> I think you and the op are both missing that the vast majority of those mid skilled jobs still exist, they just exist in countries whose labor costs are drastically lower. They exist in lower income countries, but the work quality is often shoddy and poor at best. The talented ones have already migrated to the West. Case in point, a factory we built for a project in the Middle East with a fully European team took just 9 months to finish from the start of laying the foundation stone. Similar projects in the same country by a Chinese or local company would have taken 3-4 years. Another American team executed a project in Singapore in 2.5 years, but that same project was estimated to take 6 years in India.

snapplebobapple 3y ago
That's literally point two and three of the argument I made in the second half of the first paragraph as something that is incorrect to bet on continuing forever. What would your project spread have looked like 20 years ago? I am guessing quite a lot worse. What will the spread look like in 20 years? I would bet on it being closer than it is now.
- nradov 3y ago
  Most Middle Eastern countries have made approximately zero progress on worker training and productivity in the past 20 years. Some have even gone backwards. There's no reason to expect they will do better in the next 20. It's a sad waste of human potential due to toxic politics and unfavorable geography.
  - snapplebobapple 3y ago
    If progress was equal everywhere we wouldn't have all these laggards willing to work for peanuts to improve their life (because the peanuts they were working for locally are even smaller than foreign peanuts). ~5% of the population currently not getting the job done doesn't invalidate any part of my argument. It just means that 5% might be the last guys left in the dark ages if progress continues and the policy of offshoring doesn't reverse (either for political reasons or because we cracked the full automation code and labor costs no longer matter because we aren't using much labor to produce things. If that happens the dirty stuff will still be offshored but the calculus will be different for the foreign country).