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China Starts Outsourcing From ... the US
hackingbear writes: Burdened with Alabama's highest unemployment rate, long abandoned by textile mills and furniture plants, Wilcox County, Alabama, desperately needs jobs. And the jobs are coming from China. Henan's Golden Dragon Precise Copper Tube Group opened a plant here last month, employing 300 locals. Chinese companies invested a record $14 billion in the United States last year, according to the Rhodium Group research firm. Collectively, they employ more than 70,000 Americans, up from virtually none a decade ago. Powerful forces — narrowing wage gaps (Chinese wages have been doubling every few years), tumbling U.S. energy prices, the rising Yuan — up 30% over the decade — are pulling Chinese companies across the Pacific. Perhaps very soon, Chinese workers will start protesting their jobs being outsourced to the cheap labor in the U.S."
Welcome Chinese overlords!
"When information is power, privacy is freedom" - Jah-Wren Ryel
can't wait for those whining on the forums, "damn Americans stealing jobs from hard working people."
mfwright@batnet.com
Funny, ours have been halving.
So it really is a race to the bottom.
Lost at C:>. Found at C.
God Bless America.
Businesses will continue to take advantage of poverty, wherever it exists and whoever it is. Greed is blind to creed and color. All it cares about is profit.
For years I put up with hardcore socialists complaining about the theory that a rising tide lifts all boats (ie: Export wealth properly and everyone will benefit). I can't wait for them to be the first in line to refuse these jobs.
I was thinking some years ago "If all the jobs went to China because no one in the US wants the factory worker life, who is gonna build Chinese doohickeys when *they* get tired of the factory life?"
I was thinking India. Or Malaysia, or Chile or something..
But not the USA. I never even considered that possibility.
WTF. This world no longer makes any sense to me.
The "Civilized World" jumped the shark ca. 1973.
the race to the bottom :-(
I've been doing engineering work outsourced from China for almost 4 years now.
Are not trivial for moving heavy products from continent to continent.
Labor with automated systems is sometimes no longer a large expense.
Thats what is being touted for the Shandong Tranlin Paper Co. greenfield mill being built near Richmond VA, and to break ground in 2016
Chinese paper company to set up shop in Richmond suburbs
Sure I don't expect 2000 permanent full time jobs, but injecting $2 billion into a community ain't so shabby
I am Slashdot. Are you Slashdot as well?
... and us Americans won! I'll never doubt a cheap labor conservative again.
Support microSD: in a post 9/11 world, it is unwise to carry your data on media that you cannot comfortably swallow.
Soon Americans will be seeking jobs as au pairs in China....
Asia is the place to be. Asia is an exciting place: India, China. If you are young and have not visited these place the best advice you will receive is simply to go. Learn some Hindi or Mandarin. Drop any expectations. Just explore. Your future will be brighter for the experience.
Asia has a youthful population. The culture is alive. The Asian take / mix on American culture which produces endearing results. It is a bit of an over judgement but in America the youth are caught up in vanity, drugs. American youth are generally immature. In Asia the youth are hungry for knowledge. They have clarity in their eyes.
Sourcing manufacturing jobs in Georgia is like shooting fish in a barrel. OSHA and EPA inspections are basically nonexistent and the threat of meaningful unionization is basically the same as the PRC. The most important reason chinas looking to the US for sourcing jobs is not because their citizens are earning more, its because you are earning less. according to the social security national wage index the average take home yearly pay for a worker in 1977 was $9779. adjusted, thats $58,713 in 2013 dollars.
https://www.socialsecurity.gov...
http://adjustforinflation.com/
what this chinese company proposes is offering manufacturing workers $15 an hour, or around $31k a year. Things like health and dental insurance are probably not going to be provided by this company, and that would usually be OK because a state healthcare exchange would help but georgia hasnt passed any conforming legislation and does not to date have an exchange of its own, nor has it expanded medicare coverage.
Good people go to bed earlier.
The Chinese government is very strategic about creating 'soft power' (political, cultural, economic, and diplomatic influence; as opposed to 'hard power', which is typically military force or economic sanctions). Look up Confucius Institutes and the Three Warfares, for example. China also uses its market power to get what it wants politically; look up how Hollywood studios allow Chinese censors to edit their movies (and not just for Chinese distribution).
It's not a new idea to use jobs to create influence. Government contractors locate jobs in the districts of key members of Congress in order to get votes; when Japan's auto industry was viewed as a threat, the built factories in the U.S.
In the locations where Chinese companies are placing jobs, how likely is it that the people or their representatives will support sanctions, force, or any actions detrimental to China?
(China isn't the only country to do such things, of course, but they have a lot of money, an aggressive outlook, and their government has a lot of involvement with and influence over their businesses.)
50,000200,000,00 ?
Here it comes: The unboxer rebellion!
If the manufactured items stay in the USA (or are shipped to any place where it may be cheaper than shipping from China) then this is just putting the factory where the product is being used and is not really "outsourcing". The term "outsourcing" should be limited to when jobs move to follow cheap or available labor but otherwise defies any business logic.
The article is not clear on where the factory output is going, or where the raw materials come from. There is one mention of a glass factory who's "site puts Fuyao within four hours' drive of auto plants in Ohio, Kentucky and Indiana." All the others don't seem to say whether delivery to the USA is part of the reason for the relocation.
This is all temporary. Mass production is a passing fad. By the end of the 21st century everything will be made to order at the local additive fabrication shop or on your own 3d printer. Anything that can't be made that way will be fabricated by robots. Robots which are self repairing.
This is why Bush gave China Most Favored Nation trading status which eliminates almost all finished-good tariffs and port authority scrutiny.
Maw! Fire up the karma burner!
so they went to the bottom of the barrel?
As if it wasn't hard enough to learn Chinese to talk to your suppliers directly, now you've got to learn to understand people in Alabama? That's fucked up.
Is it just my observation, or are there way too many stupid people in the world?
Well, actually this scenario isn't quite so silly, but there are some very silly scenarios induced largely by American executives with an outdated view of the world....
A couple years back I was approached with an opportunity by an Indian firm. They had landed a contract to offshore some companies software development. The problem was they had more business than their developers could chew, so they were looking to assemble a team in the most economical place they could, a particular region of the US. Of course, the ocean crossing thing adds blatant confusion to it, but even domestic outsourcing will have companies replace an employee with one or more 'temps' that cost 30% more each.
On the flip side, executives at the company I work at routinely push to offshore work to China to save money, and not to 'waste american talent' on various projects. Of course, they fail to notice that they only get the fresh out of school or still in school Chinese employees and usually only three or so months before they find more lucrative Chinese positions than whatever hellhole still continues to be a shockingly low cost solution in this day and age, all while failing to ever really deliver the solution.
that we can't speak proper Chinese.
that's a dumb dichotomy and it shows the weakness of your position
obviously, in a perfect world we wouldn't need any remediations...we'd all ***rather*** not have the problem at all
the minimum wage is the same as anti-trust laws...it plugs a hole in capitalism...just as a mononpoly is the antithesis of free market competition, so is it harmful when companies monopolize the factors of employment
we need anti-trust laws for the same reason we need minimum wage laws: unchecked corporate greed
Thank you Dave Raggett
I know many "hardcore socialists" personally, and read/watch several public figures who are "hardcore socialists" in various media...and NONE make the argument you claim they make
no one says that
except GOP trolls creating a straw man...you're a GOP troll, trying to create a straw man
Thank you Dave Raggett
If you say it enough times then perhaps it will become true!
Failure is an orphan.
The world is made by those who show up for the job.
So, they sell tons of goods to US that pay them in dollar. What are they supposed to be doing with all that cash? Change it to yuan, that would be bad for the currency? Buy government bonds, at such a rate, no way! Buy gas to Russia, that's not done in dollar anymore. What's left? Investing all that money in the US maybe, that's still better than leaving idle on a reserve account. Yeah, why not.
This could just be the result of the PRC's decision to allow greater variability in Yuan/Dollar variabitlity. One of the big benefits to multinational fims is called transfer pricing. Basicly, the transfer price is the internal price firms use for components and materials. By manipulating the price a firm can manage exchange rate volatility and move profits between countries for tax advantage.
which doesn't matter at all
the problem is unchecked corporate greed...that's what drives all of this
Thank you Dave Raggett
The likely reason the Chinese want to build factories here is that most states will bend over backwards to accommodate them. In this case, the town of Pine Hill is offering the Chinese factory a massive tax break - probably zero taxes for something like 20 years - and a place where their company has more financial freedom. I wouldn't be surprised if the town or state is also offering them tax money to stay. It's a problem all over the US: companies holding jobs hostage because someone else is offering them a better tax package.
Where are the tumbling U.S. energy prices? GAO show nothing but rising energy prices.
.
Why, all of a sudden has the terminology changed?
For someone to actually be poor and unemployed and noble and virtuous and good, requires real work. Such folks must be greedy and selfish and thinking only of themselves to be so noble and virtuous and good, they may as well slap the face of everyone who merely has a job where they only get paid in money. Nobody should have to be noble and virtuous and good - the only reason people do have to be noble and virtuous and good is because other people are selfish and don't give them props for acting as average-job-taking-money-earning people.
You realize that the reason a billion Chinese were poor in the first place is because of the Cultural Revolution, their violent Communist revolutionary past? But yeah, it's those "evil businesses". The main reason Chinese wages have been rising for the past few decades is because they partially ended the Communism and began partial market reforms.
It's also a helpful reminder of why the effect of Chinese wages on global inflation and wage inflation (e.g. flooding the world with cheap Chinese products) was largely a once-in-history thing. As they recover fully from Communism, their quality of life rises to be closer on par with developed nations. As the summary mentions, Chinese wages have been rising for some time, thanks to those evil businesses.
My other UID is three digits.
Working in a refinery with health benefits. $15/hr, or $30K/yr, when adjusted for inflation would be about $30, or $60k/yr, these days. In contrast I am making a bit more than that but have paid off a number of student loans and pay far more for health care since then even with much more education than he ever had. He graduated the 8th grade and then got his GED.
Is this progress? I think not.
putting the 'B' in LGBTQ+
I predicted this sort of thing back in 2006. And let's be honest: It's not that suprising, is it? Globalisation is once around the globe by now. In the US, entire landscapes are out of jobs and glad for anything. In China more than a decades worth of 8%+ growth has started to saturate markets and upped the price for labor, shrinking the margins.
Next up will be robots. And they don't care where they stand, neither does the corp that owns them. They will be placed closest to the buyer to reduce transport costs. The avantgarde will start building modern factories in western countries now again. Like Tesla.
My 2 cents.
We suffer more in our imagination than in reality. - Seneca
The ultimate combination
I'm not repeating myself
I'm an X window user; I'm an ex-Windows user
Unpinning the Yen from the dollar and deflating the Dollar will be seen as huge benefits to the US in the long run. Sure goods from China & Europe will become more expensive (aka inflation), but US workers will have jobs. No one tell Europe that holding Euro-based wages high with austerity is a job killer.
The Chinese don't get soft power at all.
Sure they do: the Chinese use bamboo clubs to hit protestors instead of aluminium ones.
No? You're entire post is based on the idea that Unions are inherently bad. For a capitalist they are. I've said it before and I'll say it again: Marx predicted that capital would flow to where ever labor's cheapest in a constant race to the bottom, but all anyone can remember about him is that a few dictators borrowed one of his books for rhetoric.
/. here today talking about the death of the 40 hour work week in America. It's a statistical fact that wages have declined and productivity has increased. What in God's name are you planning to do by your little lonesome against multi-billion dollar corporations? Seriously, do you think Toyota is going to keep paying a living wage out of the kindness of their Hearts? It's the sacrifice of the Union man and the competition for those Union Jobs that's why Toyota is paying those wages in the first place. And before you bring it up, no, they don't need you to buy their cars. They have plenty of other buyers, and they really don't need that many. They can just raise the price and sell fewer.
Did it ever cross your mind that there is a _reason_ Unions formed? Have you ever heard the phrase "Nasty, brutish and short"? Have you seen pictures of the Mini-Guns used by "private" security employed by mines in the 70s to intimidate workers?
Whatever else you think, you _want_ Unions. You _need_ Unions. Unions are labor organized to seek better and safer working conditions. Nothing more or less. Hell, there's another story on
I could go on, and on, and on, but seriously man. You don't know of what you speak. Go work in a meat packing plant for a decade and tell me you don't need Unions.
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Just build floating factories, sail to international waters and and breed slaves. Fuck paying people, what a waste!
It will save all this wage currency speculation and the burden on having to move once the host country has dried up. Hell, the elites could even live on an adjoined isand-ship and use the slaves for pleasure and work.
The biggest problem would be Energy, a floating nuclear reactor? Something to harness the power of the sea? Perhaps a sympathetic country will relinquish a portion of its offshore oil in exchange for the services a lawless island could provide? Maybe just breed more slaves to push the turbines?
@Karmashock: "Actually we've seen this happen in the US for many years with a lot of foreign companies. Often because US companies fail to resolve labor or regulatory issues"
Toyota won because they build smaller, cheaper more fuel efficient cars than their US competitors, labour issues were not an .. issue ..
Toyota.
i was astounded at the idiocy of your attempt at logic
the fact that you made a statement this faulty means further conversation is pointless
Thank you Dave Raggett
if you are American, you've never met a hardcore socialist
I disagree with your post.
Decades ago, Unions were needed to protect workers rights. It was more about the overall working conditions and oppression of the work force. Company stores, unsafe conditions, no paid time off. Things like that.
In those days, our benevolent government did not regulate working conditions or a minimum wage. Thus, the Unions were needed to protect us from shady owners.
For a long time, this has not been true. The unions have become simply a tool for extracting more money from a company and going primarily into the hands the unions versus the workers. Unions routinely demand ridiculous wages for low skilled employment.
Think about the MASSIVE economic damage that the unions have done and are still doing.
Just this week in France, the baggage guys went on strike. It estimated to have caused more than a billion € in damage to the EU economy.
Do these asshole have the right to take money from my pocket because they do not like their job?? I should suffer because they feel they need 25€/hr to put a fucking bag on a trolley?
Think back to the 70's and 80's in the UK. The unions single-handedly destroyed the UK automotive production industry.
Same in the US.
GM, Ford, Chrysler. None of them were able to compete with foriegn car companies because of the unions. What? You need an extra run of cars? Well, we need triple time pay for that. We need at least 80 bucks an hour to stick a fucking screw into a hole.
Because of unions, it is not even possible to keep an excellent new teacher and fire a terrible old teacher simply because she has been there for 15 years. It doesnt matter if she knows how to teach or not.
No, the net impact of unions in this day and age, is negative.
Perhaps it is a matter of relative rates? China has a heavily loaded power grid from all of its industry even when putting up a ton of coal fired power plants. So even if the US's power cost is rising by 10% a year if China's power cost is rising by 30% a year then we're still plummeting in comparison.
We all knew it was coming. Alabama has now officially joined the Third World.
I've calculated my velocity with such exquisite precision that I have no idea where I am.
"Tianjin Pipe, for instance, began building its Texas plant after the U.S. imposed sanctions against Chinese-made pipes in 2010, notes Thilo Hanemann, Rhodium's research director."
In reality, it's usually to get around tariffs, contract requirements, or for sales purposes. Chinese labor is still super-cheap compared to the U.S.
Hey, what's the difference between a liberal and a socialist?
Socialists ALWAYS watch soccer!
Our company just got asked to outsource for a company in India.
We are based in a rural area of central Utah, with low overhead, so our expenses (and prices) are quite low.
We're turning them down, but it was interesting nonetheless.
Water seeks its own level, even when the water is pricing and the seafloor is a global marketplace.
"Perhaps very soon, Chinese workers will start protesting their jobs being outsourced to the cheap labor in the U.S" Yes but they will all be dismissed quietly to remote re-education camps...
This is pretty consistent with economic models that claim we are all competing for the same jobs, with the attendant sloppy back and forth to equilibrium.
"There is no god but allah" - well, they got it half right.
The guy I worked with who ran for Governor of Wisconsin on the Socialist Workers Party ticket seemed pretty hardcore.
Henry Ford was the 1st to pay a living wage. 1st to have a a health system. But to keep your job your had to finance or buy a new Ford every 3 years. He did this before the UAW existed.
is nothing but a Pyramid scandal
Casteism
"Turnabout's fair play" as the saying goes...
Instead of "immigration reform" can we just offer to relocate illegals to China for free? It will cost us less in the long run.