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A popular misconception is that manufacturing is done in China because it’s cheaper. That hasn’t been true for a while. There are cheaper places, many of them.

by api 7mo ago

A popular misconception is that manufacturing is done in China because it’s cheaper. That hasn’t been true for a while. There are cheaper places, many of them. China is now simply the best, at least when it comes to electronics and adjacent stuff.

lenerdenator 7mo ago
Best == cheaper. Could you do it in the US? Probably. But it'd take longer and you'd have to pay more money.
- Almondsetat 7mo ago
  The US literally doesn't have the people to do this.
  - lenerdenator 7mo ago
    Yes and no. The US is still an economy with the ability to tackle very complex tasks with its industrial base. Up until fairly recently, it was a major destination for people seeking higher education and work in specialized fields in STEM, which is necessary for the execution of the projects that companies like Apple want to do. The problem is that we now have an anti-immigration administration, and are home to a number of multinational companies - Apple's a great example - that feel that their one and only obligation is to create value for shareholders. They don't want to throw the money needed at American engineer salaries, because money paid to the American engineer is money not paid to a shareholder. We can possibly deal with the administration. The US isn't the only country in the world with a nativist movement; China does it with non-Han peoples within its borders. The real hangup is making a bunch of Americans with capital feel some sort of loyalty towards their own country and its workers.
    - slaw 7mo ago
      No and no. US companies started offshoring in 2022. There are no new STEM jobs since than.
      - lenerdenator 7mo ago
        > US companies started offshoring in 2022. There are no new STEM jobs since then. "The real hangup is making a bunch of Americans with capital feel some sort of loyalty towards their own country and its workers."
  - _DeadFred_ 7mo ago
    China didn't either, until it did. US business isn't willing to build up the workforce to do this but we definitely have the people.
    - kube-system 7mo ago
      The US used to have a more built out industrial base but since those days a lot of things have changed, structurally, economically, culturally, and in their regulatory environment. The people who would have been doing this work are doing cushy service industry jobs today.
      - _DeadFred_ 7mo ago
        Huh? The people who would have been doing this are doing shitty HVAC jobs (but still getting to be a bit creative). Are doing shitty welding jobs. Are doing HEAVILY underemployed service industry jobs they hate. Etc, etc. None of the people I know with a mind for making/tinkering/refining processes are working service industry jobs happily. People didn't culturally decide they don't want these sorts of jobs, business did, because short term monetary benefit. The other stuff may have come along after but could easily be reversed. But currently there is no need to reverse because US business only cares about short term monetary gain. All this talk like this is some huge systemic thing is BS. If there were jobs, it would all happen. Just like it did in China.
        kube-system 7mo ago
        This goes far beyond skilled labor. But I'll start with that point. The US already has a huge shortage of skilled labor, and it's not like we would ever take people from the HVAC industry and put them in a factory. People in the US are gonna still want air conditioning. Culturally, the US absolutely pushes young people to aim for white collar service industry jobs. Second, it takes a huge amount of engineering talent to do what China is doing as well. In the US, a lot of engineering talent has been attracted to software (or other service industry jobs), where there's a lot of money to be made, and you can sit on your ass and argue on an orange-colored website all day. I prefer that to wearing a hardhat and waking up at 6 AM to go to a factory. Third, China concentrates a lot of this talent into dense cities, and people make a lot of sacrifices to live there. You're definitely not gonna convince an HVAC guy to leave his suburban home and sell his pickup truck to go live in a dormitory in a dense city and ride a scooter. In China, there's plenty of people that are itching to leave the countryside for the city, leave their families, and search for a better life. In the US, people that live outside of cities, generally want to live there, and aren't interested in relocating. Most developed nations feed this need for skilled labor by importing labor from countries where people have a strong desire to better themselves but don't have a cultural expectation of a backyard and a white picket fence. But the US has had a fucked up immigration system for a long time now. Fourth, China pulls out all of the roadblocks in order to facilitate the growth of their industrial base. They don't need to go through 10 years of planning to build something, they don't need to argue with a local zoning board, and if they want to build something they don't wait for the free market to decide to do it. If they want to support an industry, they just do it. Single-party unitary governments are efficient as fuck. Of course, this comes with many drawbacks, which politically are just not viable in the US.
- quentindanjou 7mo ago
  This is not true. There is now a skill gap. There are countless examples that it isn't about being cheaper. The organisation and optimization of the workforce and infrastructure isn't something we can ignore. The choice of China isn't because it is cheaper, a lot of high-end and even luxury products are produced in China because they can ensure a high-quality manufacturing. There are other places, as the comment above mentioned, that can produce for cheaper.
  - lenerdenator 7mo ago
    Of course it's true. The US could do the exact same. Many high-quality, sophisticated goods are made in the US. It's just cheaper to do in China because the salaries are lower and the costs of establishing more efficient business infrastructure are lower. And since these companies care more about cost than anything, they choose China.
    - unbalancedevh 7mo ago
      I think it was "Smarter Every Day," but there's a YouTube channel where the guy went all-out in trying to design, source, and manufacture a simple grill scrubber 100% in the US, and failed. He got the product finished and on the market, but it was literally impossible to do it with 100% American content. IIRC, part of the problem was suppliers that lied about their sourcing, but that still represents the complete lack of availability of US sources.
      - lenerdenator 7mo ago
        Yeah. Why wouldn't US sources be available? People invest in things that maximize returns. 30 years ago they had a choice: invest in building out more manufacturing infrastructure in the US, or doing it in China. China was, and is, less expensive to run. So China got the investment dollars. You could absolutely build any product in the US. You'd just also have to build the infrastructure to build the industrial base, and that means spending more money than you would in China. It always comes down to cost. Always.
tuna74 7mo ago
A lot of things are much more efficient in China as well. Compare the cost in time and money for travel between Beijing to Shanghai vs New York to Chicago for example.
tedd4u 7mo ago
Especially if you want to make like 100,000 units per day of your product.

by api 7mo ago

lenerdenator 7mo ago

Best == cheaper. Could you do it in the US? Probably. But it'd take longer and you'd have to pay more money.

Almondsetat 7mo ago
The US literally doesn't have the people to do this.
- lenerdenator 7mo ago
  Yes and no. The US is still an economy with the ability to tackle very complex tasks with its industrial base. Up until fairly recently, it was a major destination for people seeking higher education and work in specialized fields in STEM, which is necessary for the execution of the projects that companies like Apple want to do. The problem is that we now have an anti-immigration administration, and are home to a number of multinational companies - Apple's a great example - that feel that their one and only obligation is to create value for shareholders. They don't want to throw the money needed at American engineer salaries, because money paid to the American engineer is money not paid to a shareholder. We can possibly deal with the administration. The US isn't the only country in the world with a nativist movement; China does it with non-Han peoples within its borders. The real hangup is making a bunch of Americans with capital feel some sort of loyalty towards their own country and its workers.
  - slaw 7mo ago
    No and no. US companies started offshoring in 2022. There are no new STEM jobs since than.
    - lenerdenator 7mo ago
      > US companies started offshoring in 2022. There are no new STEM jobs since then. "The real hangup is making a bunch of Americans with capital feel some sort of loyalty towards their own country and its workers."
- _DeadFred_ 7mo ago
  China didn't either, until it did. US business isn't willing to build up the workforce to do this but we definitely have the people.
  - kube-system 7mo ago
    The US used to have a more built out industrial base but since those days a lot of things have changed, structurally, economically, culturally, and in their regulatory environment. The people who would have been doing this work are doing cushy service industry jobs today.
    - _DeadFred_ 7mo ago
      Huh? The people who would have been doing this are doing shitty HVAC jobs (but still getting to be a bit creative). Are doing shitty welding jobs. Are doing HEAVILY underemployed service industry jobs they hate. Etc, etc. None of the people I know with a mind for making/tinkering/refining processes are working service industry jobs happily. People didn't culturally decide they don't want these sorts of jobs, business did, because short term monetary benefit. The other stuff may have come along after but could easily be reversed. But currently there is no need to reverse because US business only cares about short term monetary gain. All this talk like this is some huge systemic thing is BS. If there were jobs, it would all happen. Just like it did in China.
      - kube-system 7mo ago
        This goes far beyond skilled labor. But I'll start with that point. The US already has a huge shortage of skilled labor, and it's not like we would ever take people from the HVAC industry and put them in a factory. People in the US are gonna still want air conditioning. Culturally, the US absolutely pushes young people to aim for white collar service industry jobs. Second, it takes a huge amount of engineering talent to do what China is doing as well. In the US, a lot of engineering talent has been attracted to software (or other service industry jobs), where there's a lot of money to be made, and you can sit on your ass and argue on an orange-colored website all day. I prefer that to wearing a hardhat and waking up at 6 AM to go to a factory. Third, China concentrates a lot of this talent into dense cities, and people make a lot of sacrifices to live there. You're definitely not gonna convince an HVAC guy to leave his suburban home and sell his pickup truck to go live in a dormitory in a dense city and ride a scooter. In China, there's plenty of people that are itching to leave the countryside for the city, leave their families, and search for a better life. In the US, people that live outside of cities, generally want to live there, and aren't interested in relocating. Most developed nations feed this need for skilled labor by importing labor from countries where people have a strong desire to better themselves but don't have a cultural expectation of a backyard and a white picket fence. But the US has had a fucked up immigration system for a long time now. Fourth, China pulls out all of the roadblocks in order to facilitate the growth of their industrial base. They don't need to go through 10 years of planning to build something, they don't need to argue with a local zoning board, and if they want to build something they don't wait for the free market to decide to do it. If they want to support an industry, they just do it. Single-party unitary governments are efficient as fuck. Of course, this comes with many drawbacks, which politically are just not viable in the US.
quentindanjou 7mo ago
This is not true. There is now a skill gap. There are countless examples that it isn't about being cheaper. The organisation and optimization of the workforce and infrastructure isn't something we can ignore. The choice of China isn't because it is cheaper, a lot of high-end and even luxury products are produced in China because they can ensure a high-quality manufacturing. There are other places, as the comment above mentioned, that can produce for cheaper.
- lenerdenator 7mo ago
  Of course it's true. The US could do the exact same. Many high-quality, sophisticated goods are made in the US. It's just cheaper to do in China because the salaries are lower and the costs of establishing more efficient business infrastructure are lower. And since these companies care more about cost than anything, they choose China.
  - unbalancedevh 7mo ago
    I think it was "Smarter Every Day," but there's a YouTube channel where the guy went all-out in trying to design, source, and manufacture a simple grill scrubber 100% in the US, and failed. He got the product finished and on the market, but it was literally impossible to do it with 100% American content. IIRC, part of the problem was suppliers that lied about their sourcing, but that still represents the complete lack of availability of US sources.
    - lenerdenator 7mo ago
      Yeah. Why wouldn't US sources be available? People invest in things that maximize returns. 30 years ago they had a choice: invest in building out more manufacturing infrastructure in the US, or doing it in China. China was, and is, less expensive to run. So China got the investment dollars. You could absolutely build any product in the US. You'd just also have to build the infrastructure to build the industrial base, and that means spending more money than you would in China. It always comes down to cost. Always.

tuna74 7mo ago

A lot of things are much more efficient in China as well. Compare the cost in time and money for travel between Beijing to Shanghai vs New York to Chicago for example.

tedd4u 7mo ago

Especially if you want to make like 100,000 units per day of your product.