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(The Atlantic)   No unions, low minimum wage, uneducated workforce, no environmental protection, no OSHA: the US is becoming a cheap manufacturing paradise   (theatlantic.com) divider line 119
    More: Cool, Occupational Safety and Health Administration, Jeffrey Immelt, United States, water heaters, industrial parks, Harvard Business Review, countertops, dryers  
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4131 clicks; posted to Business » on 04 Dec 2012 at 11:19 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-12-04 04:52:07 AM
COOL tag?

Maybe I should RTFA to see how Subby came to use that unlikely tag....nah.
 
2012-12-04 05:04:54 AM
We're gonna party like it's 1899.
 
2012-12-04 05:19:58 AM
If we just give the rich tax cuts everything will return to the good old days.
 
2012-12-04 06:06:52 AM
Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.
 
2012-12-04 06:07:34 AM
Ffs. It takes a truly special country to intentionally decide to regress in unison.

How are the Republicans winning this war?
 
2012-12-04 06:08:43 AM

Frederick: COOL tag?

Maybe I should RTFA to see how Subby came to use that unlikely tag....nah.


Illiteracy, one reason not to move manufacturing back to the US.
 
2012-12-04 06:13:33 AM

MorrisBird: Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.


It's a good article. I think it's interesting that they note that in the rush to outsource for cheap labor, many companies didn't factor in the hidden costs. When a company can manufacture something of higher quality at comparable or lower costs here, why continue to manufacture in China?
 
2012-12-04 06:35:02 AM
usa usa usa!

oblig
 
vpb [TotalFark]
2012-12-04 08:35:25 AM
Obviously we just need to reduce out standard of living to Chinese levels. Problem solved.
 
2012-12-04 09:19:04 AM
This oughta be good.
 
2012-12-04 10:04:25 AM
the scariest part of that article is seeing how completely GE lost control of its product designs when it outsourced.
 
2012-12-04 10:28:06 AM
I think this just made my day:

"The GeoSpring suffered from an advanced-technology version of "IKEA Syndrome." It was so hard to assemble that no one in the big room wanted to make it. Instead they redesigned it. The team eliminated 1 out of every 5 parts. It cut the cost of the materials by 25 percent. It eliminated the tangle of tubing that couldn't be easily welded. By considering the workers who would have to put the water heater together-in fact, by having those workers right at the table, looking at the design as it was drawn-the team cut the work hours necessary to assemble the water heater from 10 hours in China to two hours in Louisville.

In the end, says Nolan, not one part was the same.

So a funny thing happened to the GeoSpring on the way from the cheap Chinese factory to the expensive Kentucky factory: The material cost went down. The labor required to make it went down. The quality went up. Even the energy efficiency went up.

GE wasn't just able to hold the retail sticker to the "China price." It beat that price by nearly 20 percent. The China-made GeoSpring retailed for $1,599. The Louisville-made GeoSpring retails for $1,299."


America: F*ck yeah!
 
2012-12-04 10:28:20 AM

MorrisBird: Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.


When we invest locally, we bring up those communities. Not just in the direct jobs that the facilities provide, but in the distribution chains that supply them, the local artisans, the local contractors, who likewise ripple out their business to support these facilities. Workers also tend to spend their cash locally, put their dollars in local banks. This brings up the standards across the board, as folks rise up to serve these communities, and other opportunities that arise.

Not to mention, there IS less transportation. Don't have to ship goods back as far. The savings to labor is then offset by the cost of transporting those goods. Not to mention less need for training workers to standards that are US normal. Yeah, this is a piece that deserved a much better headline...
 
2012-12-04 10:40:30 AM
I didn't see in the article where the employees were only making minimum wage. Apparently, people manufacturing here in non-union jobs is worse than outsourced jobs resulting in no people working here.

"One key difference between the U.S. economy today and that of 15 or 20 years ago is the labor environment-not just wages in factories, but the degree of flexibility displayed by unions and workers. Many observers would say these changes reflect a loss of power and leverage by workers, and they would be right. But management, more keenly aware of offshoring's perils, is also trying to create a different (and better) factory environment. Hourly employees increasingly participate in workplace decision making in ways that are more like what you find in white-collar technology companies."
 
2012-12-04 10:59:18 AM
American unions are changing their priorities. Appliance Park's union was so fractious in the '70s and '80s that the place was known as "Strike City." That same union agreed to a two-tier wage scale in 2005-and today, 70 percent of the jobs there are on the lower tier, which starts at just over $13.50 an hour, almost $8 less than what the starting wage used to be.

FARK YEAH!!! U.S.A.! U.S.A.!
i49.tinypic.com
 
2012-12-04 11:07:28 AM

tallguywithglasseson: American unions are changing their priorities. Appliance Park's union was so fractious in the '70s and '80s that the place was known as "Strike City." That same union agreed to a two-tier wage scale in 2005-and today, 70 percent of the jobs there are on the lower tier, which starts at just over $13.50 an hour, almost $8 less than what the starting wage used to be.

FARK YEAH!!! U.S.A.! U.S.A.!
[i49.tinypic.com image 293x255]


and just over $13.50 an hour more than those positions would have been paying otherwise.
 
2012-12-04 11:27:21 AM
The solution is to raise taxes

/liberal answer to everything
 
vpb [TotalFark]
2012-12-04 11:37:51 AM

slayer199: I didn't see in the article where the employees were only making minimum wage. Apparently, people manufacturing here in non-union jobs is worse than outsourced jobs resulting in no people working here.

"One key difference between the U.S. economy today and that of 15 or 20 years ago is the labor environment-not just wages in factories, but the degree of flexibility displayed by unions and workers. Many observers would say these changes reflect a loss of power and leverage by workers, and they would be right. But management, more keenly aware of offshoring's perils, is also trying to create a different (and better) factory environment. Hourly employees increasingly participate in workplace decision making in ways that are more like what you find in white-collar technology companies."


No, it just says that workers are having to accept less that they did back when we had more duties on imported goods that encouraged manufacturers to make things here.
 
2012-12-04 11:39:23 AM
mediad.publicbroadcasting.net
"Insourcing" you say?
 
2012-12-04 11:42:40 AM
The terrorists have won.
 
2012-12-04 11:44:40 AM

Bontesla: Ffs. It takes a truly special country to intentionally decide to regress in unison.

How are the Republicans winning this war?


Because no one opposes them, and if you so much as contemplate the idea of doing so, you get shouted down for "making perfect the enemy of good" by people who have been voting "Republicans, but slower" for half a century.
 
2012-12-04 11:52:39 AM

propasaurus: MorrisBird: Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.

It's a good article. I think it's interesting that they note that in the rush to outsource for cheap labor, many companies didn't factor in the hidden costs. When a company can manufacture something of higher quality at comparable or lower costs here, why continue to manufacture in China?


This plus fracking (yea, I'm not sure its great for the environment either, but coal still sucks balls and my complaints would fall on deaf ears anyways) should help us out quite a bit.

Let's just hope that when natural gas stops being cheap we are ready for alternative energy. If we do that we are good to go for quite a while.
 
2012-12-04 12:02:07 PM
My employer would be an OSHA inspectors dream. Machines leaking oil and water everywhere, power strips plugged into power strips plugged into power strips, extension cords worn down to the wire and run through the puddles of oil and water. I could list more, but you get the idea.

I think the best part is its a plastic injection molding company...the machines run between 300 and 700 degrees, we have cardboard all over the place for packaging...and no fire sprinkler system. Im fairly sure the owner already has the "complete loss due to fire" insurance paperwork filled out, just waiting to be signed and dated.
 
2012-12-04 12:07:10 PM

Sultan Of Herf: My employer would be an OSHA inspectors dream. Machines leaking oil and water everywhere, power strips plugged into power strips plugged into power strips, extension cords worn down to the wire and run through the puddles of oil and water. I could list more, but you get the idea.

I think the best part is its a plastic injection molding company...the machines run between 300 and 700 degrees, we have cardboard all over the place for packaging...and no fire sprinkler system. Im fairly sure the owner already has the "complete loss due to fire" insurance paperwork filled out, just waiting to be signed and dated.


Could be worse:
Link
 
2012-12-04 12:11:49 PM

hinten: Frederick: COOL tag?

Maybe I should RTFA to see how Subby came to use that unlikely tag....nah.

Illiteracy, one reason not to move manufacturing back to the US.


Workers don't need to read. They can be taught using videos. It ensures that the only thing they know is what management tells them.

Sultan Of Herf: My employer would be an OSHA inspectors dream. Machines leaking oil and water everywhere, power strips plugged into power strips plugged into power strips, extension cords worn down to the wire and run through the puddles of oil and water. I could list more, but you get the idea.

I think the best part is its a plastic injection molding company...the machines run between 300 and 700 degrees, we have cardboard all over the place for packaging...and no fire sprinkler system. I'm fairly sure the owner already has the "complete loss due to fire" insurance paperwork filled out, just waiting to be signed and dated.


Better check your fire exits. Bangladesh has raised the fire fatality bar and I know some American Job Creator is itching to make America #1 in this fiercely competitive field.
 
2012-12-04 12:15:26 PM

thomps: and just over $13.50 an hour more than those positions would have been paying otherwise.


AMEN BROTHER!

This is what we've been fighting for. For years. Either low-paying job, or no job! Shut up and be glad you can work at all! Wages being depressed equals great success!
i49.tinypic.com
 
2012-12-04 12:26:11 PM

thomps: the scariest part of that article is seeing how completely GE lost control of its product designs when it outsourced.


Now I know why the compressor on my 3 year old refrigerator broke.
 
2012-12-04 12:27:17 PM

tallguywithglasseson: thomps: and just over $13.50 an hour more than those positions would have been paying otherwise.

AMEN BROTHER!

This is what we've been fighting for. For years. Either low-paying job, or no job! Shut up and be glad you can work at all! Wages being depressed equals great success!


those low paying jobs allowed the higher paying jobs (i.e. the second pay tier) to come back. they also, presumably create higher paying white collar support positions as well as positions to bring all stages of design and production back into the states. wages aren't being depressed if those peoples' only other alternatives without them were minimum wage jobs. and from the article it sounds like it's a virtuous cycle, as they gain efficiencies they start to build up assembly lines to make more of the components that go into their products, which creates more jobs and facilitates upward mobility for those entry-level $13.50 wage earners. but no, you're right, the only way to look at this is through a straight comparison of the lowest wage paid in 1970 vs. today.
 
2012-12-04 12:30:50 PM
2.bp.blogspot.com

Outsourcing to China is what we recommend.
 
2012-12-04 12:37:08 PM
Cheap natural gas supplies should be on that list. A major expense reduction for manufacturers in other countries
 
2012-12-04 12:37:14 PM
Just what I always wanted America to be, a slave economy just like China
 
2012-12-04 12:38:43 PM

Jacobin: Cheap natural gas supplies should be on that list. A major expense reduction for manufacturers in other countries


ftfa:

- Oil prices are three times what they were in 2000, making cargo-ship fuel much more expensive now than it was then.
- The natural-gas boom in the U.S. has dramatically lowered the cost for running something as energy-intensive as a factory here at home. (Natural gas now costs four times as much in Asia as it does in the U.S.)
- In dollars, wages in China are some five times what they were in 2000-and they are expected to keep rising 18 percent a year.
- American unions are changing their priorities. Appliance Park's union was so fractious in the '70s and '80s that the place was known as "Strike City." That same union agreed to a two-tier wage scale in 2005-and today, 70 percent of the jobs there are on the lower tier, which starts at just over $13.50 an hour, almost $8 less than what the starting wage used to be.
- U.S. labor productivity has continued its long march upward, meaning that labor costs have become a smaller and smaller proportion of the total cost of finished goods. You simply can't save much money chasing wages anymore.


the headline is a really really bad representation of the article.
 
2012-12-04 12:39:57 PM
Fantastic.
Even more $8/hr jobs to drive the classes even further apart. Oh thank you grand rich masters for tossing the peasants a farthing.
 
2012-12-04 12:40:37 PM

thomps: but no, you're right, the only way to look at this is through a straight comparison of the lowest wage paid in 1970 vs. today.


It's not the only way to look at it, and not my point. It's good the jobs are back. It's good that manufacturing is coming back.

But that 70% of those jobs are the low-paying variety, and that they're $8/hr less (not $8/hr less than last year, but less than they were 20-30 years ago) says something about the standard of living that unskilled wage earners can expect. And it's not that people are indifferent to it, or just satisfied with some trade-off, but that people are actually cheerleading for low wages, for whatever reason (usually hatred of unions) that I find disturbing.  Almost a smugness and all-is-right-with-the-world type of vibe I get from many a Fark commenter.
I wasn't planning on spelling this out, just doing it because I'm actually arguing with someone whose opinion I respect.
 
2012-12-04 12:41:53 PM
Yeah, the article doesn't have much to do with the headline...

anyways OSHA is definitely here and raping more than ever.

/raping for good that is.
 
2012-12-04 12:41:58 PM

tallguywithglasseson: thomps: and just over $13.50 an hour more than those positions would have been paying otherwise.

AMEN BROTHER!

This is what we've been fighting for. For years. Either low-paying job, or no job! Shut up and be glad you can work at all! Wages being depressed equals great success!


$21.50 for an entry level assembly job seems excessive. $13.50 to start doesn't sound too bad to go in and start learning. Paying almost 45k to someone to screw down a panel is a quick way to send those jobs right back to China.
I thought it was a really good, encouraging read.
 
2012-12-04 12:44:03 PM

thomps: the scariest part of that article is seeing how completely GE lost control of its product designs when it outsourced.


Very true. I work for a company that ceased making their own electric motors here in the US about 10 years ago....now no one on staff knows enough about electric motors to design/optimize a design...

Now we just shop around from Chinese factory to factory...
 
2012-12-04 12:44:58 PM
The article was very hopeful.

At the very least if I will be in the need for a hot water heater I will be looking at the GE model listed in the article. If a quality product is made in the US and is only a few bucks more than an equivalent foreign product or whatever I like to support the home team

Lodge is like that, as good or better than the Le Crueset stuff for like 1/3 the price.
 
2012-12-04 12:46:45 PM
I have always said that outsourcing is not the money saver that it is trumped up to be. Having worked in an industry (printing) that saw a lot of its production outsourced to China, I can tell you how F'd up it really is. No quality control, long lead times, and zero communication. And when your client rejects the finished product because it doesn't look like what you said it would look like and you need to get the job reprinted ASAP, any savings you thought you had are now gone and you just spent more than you would have if you just kept production here.
 
2012-12-04 12:47:07 PM
Ok, I am laughing my ass off at the Hulk Hogan posts.
 
2012-12-04 12:49:55 PM

sure haven't: Ok, I am laughing my ass off at the Hulk Hogan posts.


Thank you. Really, that was my main point. Also to link to the youtube video, since that song is now stuck in my head.
 
2012-12-04 12:56:01 PM

Surly U. Jest: I have always said that outsourcing is not the money saver that it is trumped up to be. Having worked in an industry (printing) that saw a lot of its production outsourced to China, I can tell you how F'd up it really is. No quality control, long lead times, and zero communication. And when your client rejects the finished product because it doesn't look like what you said it would look like and you need to get the job reprinted ASAP, any savings you thought you had are now gone and you just spent more than you would have if you just kept production here.


As an importer, this is great news. China sucks. China sucks lead-coated donkey dongs.
No quality control, long lead times, and zero communication

You got that right, Jack!
 
2012-12-04 01:08:02 PM

tallguywithglasseson: But that 70% of those jobs are the low-paying variety, and that they're $8/hr less (not $8/hr less than last year, but less than they were 20-30 years ago) says something about the standard of living that unskilled wage earners can expect. And it's not that people are indifferent to it, or just satisfied with some trade-off, but that people are actually cheerleading for low wages, for whatever reason (usually hatred of unions) that I find disturbing. Almost a smugness and all-is-right-with-the-world type of vibe I get from many a Fark commenter.


i'd be willing to bet that the "$8/hr less" is inflation-adjusted real dollars as opposed to a nominal comparison between now and 1970, but definitely still appreciate the point. i just think that the manufacturing world has changed so much since then (even excluding globalization) that any comparison is irrelevant. you have to compare against the alternatives for unskilled labor today, rather than manufacturing between then and now.

ad (or at least ammo for the unions to use in negotiations).

I'm actually fairly pro-union, especially in situations like tfa where they show a willingness to work with management to adapt to market realities (e.g. lean manufacturing, tiered wages). i also think that it's disconcerting that GE chose to take their savings from on-shoring in the form of lower product prices as opposed to higher wages, but hopefully that leads to more shifts and higher wages down the road...

tallguywithglasseson: I wasn't planning on spelling this out, just doing it because I'm actually arguing with someone whose opinion I respect.


i appreciate that and return the sentiment. my only real goal in posting was to try to steer the thread a little bit away from the strawmen that the headline built back to the content of the article, which is an interesting read.
 
2012-12-04 01:11:10 PM
YAY We're winning the race to the bottom.

'Merka FUK YA!
 
2012-12-04 01:15:45 PM

propasaurus: MorrisBird: Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.

It's a good article. I think it's interesting that they note that in the rush to outsource for cheap labor, many companies didn't factor in the hidden costs. When a company can manufacture something of higher quality at comparable or lower costs here, why continue to manufacture in China?


Actually it was never about lower labor costs. It has always been a shell game to hide profits and evade taxes.

SSHHHHH We're not supposed to know about that!
 
2012-12-04 01:16:28 PM
Just throwing something onto the fire.

When Henry Ford came up with his $5/day plan...as a way for his workers to be able to afford his vehicles, it was revolutionary. That equals about $28.8 K today.

Basically, if entry level manufacturing jobs are between $13-15/hr it's right along the same lines as revolutionary pay Ford offered in 1914 (hell, I started working in IT for $12/hr). With time they can make more money or hopefully share in the profits (if companies are smart they'd stick with profit-sharing and/or stock options).

For outsourced jobs to come back, wages will be less than they were before they left (but more than the outsource wages).
 
2012-12-04 01:16:53 PM

propasaurus: MorrisBird: Actually, I RTFA. Oddly enough, it has nothing to do with the trolly headline and is quite an encouraging piece about insourcing. I'm not sure I buy it, but it's worth a read.

It's a good article. I think it's interesting that they note that in the rush to outsource for cheap labor, many companies didn't factor in the hidden costs. When a company can manufacture something of higher quality at comparable or lower costs here, why continue to manufacture in China?


It's very encouraging, and hopefully the start of a new trend. And it flies in the face of those who complain that manufacturing in America just isn't profitable any more, or that Americans won't work manufacturing jobs.
 
2012-12-04 01:18:11 PM

every god for himself: tallguywithglasseson: thomps: and just over $13.50 an hour more than those positions would have been paying otherwise.

AMEN BROTHER!

This is what we've been fighting for. For years. Either low-paying job, or no job! Shut up and be glad you can work at all! Wages being depressed equals great success!

$21.50 for an entry level assembly job seems excessive. $13.50 to start doesn't sound too bad to go in and start learning. Paying almost 45k to someone to screw down a panel is a quick way to send those jobs right back to China.
I thought it was a really good, encouraging read.


So you're not going to get a job for $42k right out of high school anymore. The town surrounding the factory would rather have 500 people making $27k right out of high school than no one making a damn thing.

And, as the article points out, the follow on effect is that 500 people need managers who make more money. All of those people need places to eat, shop and live. The factory itself encourages suppliers to set up nearby further providing economic stimulus to the area.

Yes the days of making $75k/year without a college degree are probably never coming back but its good to see that the worm may have started to turn on this issue.
 
2012-12-04 01:22:24 PM

Sasquach: thomps: the scariest part of that article is seeing how completely GE lost control of its product designs when it outsourced.

Very true. I work for a company that ceased making their own electric motors here in the US about 10 years ago....now no one on staff knows enough about electric motors to design/optimize a design...

Now we just shop around from Chinese factory to factory...


this is horrifying. reminds me of those arguments about how we couldn't build an iphone in america even if we wanted to because no-one in america knows how to commercially make computer chips anymore.
 
2012-12-04 01:24:05 PM

slayer199: Just throwing something onto the fire.

When Henry Ford came up with his $5/day plan...as a way for his workers to be able to afford his vehicles, it was revolutionary. That equals about $28.8 K today.

Basically, if entry level manufacturing jobs are between $13-15/hr it's right along the same lines as revolutionary pay Ford offered in 1914 (hell, I started working in IT for $12/hr). With time they can make more money or hopefully share in the profits (if companies are smart they'd stick with profit-sharing and/or stock options).

For outsourced jobs to come back, wages will be less than they were before they left (but more than the outsource wages).


The last sentence doesn't logically follow from the rest of your post. I don't know if it was meant to be a conclusion to your argument or just an add-on.

Changing energy costs at the location of manufacturing (natural gas), quality of work done (china), cost to ship (oil costs), and increasing standards of living overseas (believe it or not) are all contributing factors.


A better argument for why the wages will be low isn't that the companies, all other things being equal, cannot surpass the outsourcing model with a domestic one while paying a high wage, but that there is no reason for them to pay the higher wages. We still have high unemployment and it will remain a Boss' market for some time.
 
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