‘Designed in California’

Chris Rawson for TUAW:

iPhones aren’t made in America because they just can’t be. The infrastructure and labor force doesn’t exist at the levels necessary to support Apple’s operations — it’s not even close.


  • http://twitter.com/forty2j Jim McPherson

    Linked article is from January. Why surface it now?

    • http://twitter.com/MikeTRose Michael T. Rose

      The question of whether or not Apple’s products could be built in the US was raised at last night’s Presidential debate.

  • CWP

    “It may sound inhumane by American standards, but…”

    No. It is inhumane. Just because 3,000 people will jump at a job because if they don’t have that job they will go hungry doesn’t mean that $17 per day is acceptable.

    • VGISoftware

      Bullshit. It IS acceptable for all those thousands who need and want that job. You have to take it all in context–that of the economic environment OVER THERE, NOT here.

    • http://www.aichon.com Brad

      I’ve seen that line repeated again and again, and I simply don’t understand how people can keep saying it.

      $17 is just a number. What you need to be looking into is what it actually means in the place where they live. In America, $17 won’t get you very far, since the cost of living is decently high across America. But the spending power of $17 in China is significantly higher.

      I know that, fresh out of grad school, I accepted a job offer that was a third lower than other offers I received, partly because I knew that the pay from the company would go a lot further as a result of where they were located. How much more is that true between a developed nation and one that is largely still developing?

      China is not the U.S., so you need to scale your considerations appropriately. Though the value of the USD has gone down in recent years, $1 will still go a lot further in China than it will in the U.S.. You should be looking at their pay in terms of its spending power, rather than in terms of its raw numerical value, and in those terms, these people are being paid extraordinarily well for the work they are doing and the skill level required.

      • quietstorms

        Many of these teens are sending money back to their families.

        $17 is not just a number. This is in US dollars. These are teens who send a portion of their salary back to their families.

        This is the equivalent of the US in the Industrial Revolution. The US didn’t progress until they had union rights which is unusually against Chinese government’s laws.

    • JohnDoey

      I’m sorry to tell you, but you are a pampered first world hypocrite.

      All of the workers who assemble iPhones have health care. That is not true of about 1/4 of US workers. The US is the only industrialized country that excludes people from its public medical system. There are 2 estimates of how many people this kills unnecessarily per year (in other words, people who would still be alive if they were Canadians) and those estimates are 26,000 per year and 40,000 per year. That is a lot more deaths than 11 suicides per year at a factory of 400,000, a suicide rate that is lower than the typical US city, which is actually smaller in population than the Foxconn factory.

      So while you are taking umbrage at worker treatment at Foxconn factories in China, what are you doing about the worker treatment in the US? Many more are dying and being maimed and crippled because of lack of health care in the US than are dying or being maimed and crippled because they worked at Foxconn. That is an empirical fact. We have so many numbers on both Foxconn and the broken US medical system that it is not funny.

      Further, do you know what it’s like to be a Pennsylvania Coal Miner? Go find out. It will shock you to learn that coal miners go a mile into the earth, into a makeshift cavern, with fans to blow the flammable coal dust out so that it doesn’t ignite and burn them all to death — sometimes the fans fail and everybody gets burned to death — and they breathe in way, way too much coal dust, leading to them dying 10 or 20 or more years earlier than everyone else. That is if they don’t get killed in a cave-in first.

      Have you seen workers in an Amazon.com warehouse, picking orders? That is a brutal job. If you get pregnant, you are fired. If you miss a day because your wife had a baby, you get fired. You have no health care. You make what may be more in dollars than the workers at Foxconn, but you also have to pay market prices for housing, market prices for food, market prices for everything. The numbers don’t add up. Those workers are doing back-breaking work, and what they get paid barely houses and feeds them.

      To be clear, I want to see work conditions improve everywhere, including China, including at Foxconn, including on the Apple lines. But to look down your nose at Foxconn workers like they are the only factory workers in the world who have it bad is just outrageous, and in many cases, it is pure racism. For example, The Liar Mike Daisey portrayed Chines factory workers as gentle, helpless souls, who only want to spend their days writing beautiful Chinese calligraphy, if only some big fat Yank would show up and lead them from oppression. NO. The workers at Foxconn are savvy, self-aware human beings who in many cases are seizing an opportunity to improve their lives and the lives of their families, similar to going away to college. Like many people in the US, they did not have an opportunity to go to college. So like many people in the US, they rolled up their sleeves and they traveled a long way away from their family to work at a brutally hard job for what is always too little money, but at the end of the day, they are producing tiny, low-cost, ultra low-power computers that are being put into the hands of school children and are making the world a better place as they replace giant, power-hungry computers and stacks of paper 20 trees tall. They are investing in the future of China and of the world by doing work that actually NEEDS to be done. They are not bulldozing something or blowing something up or invading something. And they are lifting their families out of poverty and giving them a chance to participate in a growing Chinese middle class. That is in the best tradition of factory workers everywhere. They deserve respect, and they really do not deserve any US Americans looking down on them. If you are American, worry about your undiagnosed stage 4 cancer and your 8th grade literacy and the workers who are being abused right there in your own country.

      Not to mention, the US leads the world in jailing people, the majority of which are non-violent and poor. Some just needed medical attention but could not get it, so they self-medicated with a street drug and then got put in jail for 5 years for that. Some were laid off from a factory that got shipped to China, could not get welfare, ended up homeless, self-medicated to get out of that misery, and pretty soon they are in jail for 5 or 10 years, even though they committed no acts of violence, did not threaten anybody. In other industrialized countries, they would have seen a doctor and been given basic public housing and get back on their feet. Here, it is jail. So self-righteousness from US Americans about Chinese worker conditions is just too much. It’s absurd.

      And I did not even mention how we treat the farm workers who start way down in Mexico at the beginning of the harvest, and they travel north up into California and Arizona for the later harvest, doing back-breaking work turning fields of plants into actual food that people can eat, and can feed to their children. Over the past 4 years, over 1 million of these workers were imprisoned without charge in the US (not having a work permit is a civil offense, not a criminal offense, it is like an expired drivers license) for months at a time, and then deported to Mexico, left in the middle of nowhere there, far from family, with no money, and they have missed the rest of the harvest. These farm workers have no health care, find it very hard to secure housing because so much paperwork can be required even to rent a basic apartment, and they are constantly abused because if they go to authorities, they may get deported.

      What are you doing about the farm workers who picked your food and helped feed your family? There may be a so-called Immigration Jail right in your town, where the person who picked your breakfast is getting raped and beaten right now, before she will be dumped across the border with no money. But your head is in China for some reason.

  • tylernol

    I know this has been a truism for a while but I am going to got out on a limb and state that it wont be true forever. I do think hand assembly in the US will never happen again, but a fully automated factory is coming within reach. How much assembly by hand is still really necessary for an iPhone ? Surely robot assembly can step in soon — robots are getting cheaper, more flexible, and efficient, the US is far more stable economically and politically than China, etc. And China’s labor costs are increasing.

    • http://twitter.com/forty2j Jim McPherson

      I recall seeing elsewhere that it’s cheaper to get the humans to do it than to tool up all the machines, particularly because Apple has a habit of changing things at the last minute. So right now iPhones are basically 100% human-assembled.

    • JohnDoey

      Not for at least a generation, because the core problem is the human resources. People would have to be trained as tool and die makers and other skilled manufacturing jobs. Apple employs more tool and die makers in China than exist in the US. First, we would have to build schools for tool and die makers. In some cases, we would have to build functional High Schools for the tool and die makers to go to first. And those schools would need roads and public transit, and so would the factories, but we’re not investing in roads and public transit, either.

      I mean, you could make the robots in China and ship them to the US along with all the components and put them all together in a building, but is that really making iPhones in the US? Or is that just delayed Chinese assembly? If they are still making the robots and components in China, then what is the point? Employing US security guards and maintenance teams?

      Countries like Brazil are investing heavily in skilled manufacturing, and that is why they have an iPad factory in Brazil now, and Brazilian school children are going to learn on domestically-produced iPads, and grow up to be skilled tool and die makers and make Apple’s future hit products.

      You can’t just ignore manufacturing for 30 years as a country and then flip a switch and the nightmare is over. If you don’t like US companies using Chinese assemblers, blame a Republican, not Apple.

      • tylernol

        I think you are buying too much into the “We can only do this over there now” line. It is simply cheap unskilled labor, and a favorable exchange rate. The machine tool industry can rebound here. The high-end tools for aerospace and defense are still doing well. Skilled labor has nothing to do with the factory jobs being done to assemble electronics like the iPhone. It can be moved anyplace. I am not blaming Apple, but Apple has the power to set an example. Better US made in a heavily automated factory than in a 3rd world totalitarian country by children IMHO.

        • normm

          Assembly cost is insignificant, whether in the US or China. As John points out, it’s the confluence of related manufacturing industries that exists there and not here.

          In any case, the best jobs are the ones that depend on the existence of affordable mobile devices (app developers and people making money using apps), and those are mostly here.

  • quietstorms

    I know I wouldn’t mind paying an extra $65 for an iPhone made in the US. Just saying.

    • skreet

      why don’t you donate that to charity right now then. i heard starbucks has a great campaign to “create jobs”

    • JDSoCal

      Spoken like someone who isn’t an Apple stockholder.

      • quietstorms

        I owned AAPL from the day the original iPhone was shown off at Macworld ’til June of this year. Now I have my retirement money. I’ve always felt the same way.

        What’s your point other than greed is good?

  • skreet

    They can. Government regulation hinders the ability to produce in america. They price fix labor with minimum wage. Make employer hiring costs insanely high with payroll taxes, healthcare, medicare, ss, etc…

    • CWP

      We need more $17 per day jobs here in the United States!

      • skreet

        better than no job…

        you’re right though, lets stick with being a welfare/socialistic state. its gotta work one of these days!

    • LTMP

      Yes, its all about the dumbass labour regulations.

      Who the hell came up with the bright idea of prohibiting slave labour?

      Seriously, it isn’t the government that is price fixing labour, it is corporate America.

      Back when unemployment was below 5% and corporate profits were climbing due to improved productivity, companies laid people off in order to increase profit.

      They were able to do this because they had diminished the power of labour to negotiate (admittedly, labour didn’t do much to help their own case here).

      AS productivity increased, wages should have increased as well. They did not.

  • http://www.johncblandii.com John C. Bland II

    They could make them here. Outsourcing for cheap labor isn’t a valid excuse, IMHO. It is purely a business reason: profit.

    I’m w/ @quietstorms:disqus: $65 extra for American jobs is worth it.

  • VGISoftware

    The problem is not one of the particulars of wages or profit or even political systems.

    It’s one of the society having been systematically undermined since the early ’60s into being:

    Too stupid to learn a useful trade or skillset through shoddy education at all levels.

    The moral structure of the society being eroded to the point of a general mentality of: “It ain’t wrong if I don’t get caught.” and/or “What I do on my own time is nobody’s business.”

    Too sick to last on a job or live long enough through a blind “belief” in “doctors” who have become essentially pill pushers.

    Too morbidly obese to move because of chronic malnutrition–again at the behest of a criminal medical/pharmaceutical system–eating too much NONfood.

    Too enslaved to crippling debt due to most of the above and not being able to afford “the good life”–but yet taking desperate measures such as “investing”, gambling, and even plain old CRIME–taking without actually earning.

    Apple has not just survived this terrible decay, they have prospered because the team has had good leadership and management and work ethic to continually produce AND SELL AT A PROFIT valuable products which people actually want.

    This is called EXCHANGE.

    Companies and individuals who don’t understand the principles of exchange and follow them wither and die. Fact.

  • http://twitter.com/dustinwilson Dustin Wilson

    Actually, we can make them in America (and all of this can apply to Canada as well). The two largest manufacturers of automobiles are GM and Toyota. GM is American, and Toyota is Japanese. However, the lion’s share of Toyota’s manufacturing isn’t in Japan. It’s in the United States because they produce the cars they sell here, and they sell a lot more cars here. So, why can’t we make phones and other electronics? Because people like Chris Rawson are saying we can’t. We sent people to the moon for Christ’s sake. This defeatist attitude is what’s wrong with things today.

    When Macs were first produced they were manufactured in plants in California and Nevada, and Steve Jobs got flak for mostly producing the computers without human beings’ touching the components at all. They were made with robots, and the humans there were technicians and engineers trained to operate the robots. Today, cars are made in much similar ways. Humans only come in to do middling tasks when producing the cars.

    We’re a society that’s largely moved passed extorted workers. We can’t get millions of people willing to do repetitive brainless tasks for low pay anymore. Instead of legions of underpaid and uneducated workers we can have legions of robotics, some workers, and well-paid engineers and technicians running them. Take the stringent quality control Apple has for their products. If by and large machines were putting them together then they wouldn’t have so many rejections to deal with. It’ll take a significant investment to do such a thing because we’d have to rebuild the means to produce these things because we let our manufacturing sector implode, but it’s not beyond the realm of possibility. The reason why Apple gets targeted for this is because they’re really in a unique position to start doing something about it. And, they should.

    $17 a day isn’t a lot of money at all here, but in China it is above average pay. However, when adjusted for cost of living Chinese workers still get paid much less on average than Americans do. Someone could live off that income, but even then it’s not an income most workers would accept here in the United States. China handles their work forces differently. Here people have their living spaces and go to work every day. In China for the most part people live in housing provided by the company. Communities spring up around these companies, and it becomes a micro world. A lot of these people have these jobs for life, are under contract to remain so, and have to pay the company to leave to look for another job. This is how mining was in the US in 19th and early 20th centuries. We’ve moved passed this forced, yet paid, servitude. There’s really nothing humane about how these people work, and unlike us they don’t have the human rights and the legal system we used to stop these practices.

    In the debate last night Romney was oddly correct about something. China is a currency manipulator. China is intentionally making its currency low in value to where it makes it extremely cheap for foreign companies to produce there. Like Obama said in the debate China’s economic troubles and pressure from the US, Canada, and Europe have inflated their currency some, but it’s nowhere near what it should be. The reason why they don’t want to make their currency worth what it should be is because if they competed on a level playing field with the rest of the world they couldn’t compete.

  • JohnDoey

    It is very easy to understand this issue by flipping hardware and software.

    If you are in China right now, you can ask, “why does all of the software on my iPhone come from Silicon Valley? is it because labor costs are extremely low in Silicon Valley?”

    No. Labor costs have nothing to do with it. It’s not labor, it’s LOCATION.

    Silicon Valley is where the world class software makers gathered before the Internet, when you had to physically gather in places. There are companies in Silicon Valley that understood software decades ago, whereas even today, most companies simply don’t understand software, they don’t exploit software (Sony, for example.)

    Shenzhen is where the world class component makers and assemblers have gathered, specifically bringing both component making and assembly under the same roof, and with a giant FedEx hub right there that takes the device from the factory and ships direct to the consumer.

    Labor costs are rising in China right now. They will continue to rise. But there will still be a ton of devices assembled in China, and a ton of software made in Silicon Valley.

    • http://www.johncblandii.com John C. Bland II

      No one is asking that in China. Apple is in California and they know that. :-/ Bad analogy.