Apple is know for being a pioneer and changing the way not just Americans, but the world, interacts with computers and electronics. One place they’re a little slow to get on the boat is with the return to American manufacturing. In fact, Google beat them to it, making their Nexus phone stateside earlier this year. Tim Cook, Steve Job’s replacement, has made many statements about the company’s return to American manufacturing and he’s putting his money where his mouth is – but you won’t find “Made in the USA” Apple products under the tree this year.
It’s reported that Cook and Co. plans to invest $100 million in American production of Mac computers. Rob Enderle, an analyst in Silicon Valley told the NYTimes, “if Mr. Cook is bringing his computer assembly back to the United States, it will probably be for larger, lower-value goods that Apple wants to sell locally” – think larger machines for enterprise use – not your iPad or iPod. Macs now make up less than 20 percent of its nearly $36 billion in revenue in its most recent quarter. Apple’s iPad and iPhone sales amount to nearly 70 percent of the company’s sales and will continue to be made in low-cost centers of manufacturing like China, mostly on contract with outside companies.
Any why produce stateside? Like many other industries, there’s a slew of reasons: patriotism, helping local economies, rising cost of fuels to transport worldwide, rising wages for overseas workers and shaky labor practices at off-shore plants.
However, there needs to be some explanation here – manufacturing and production aren’t what they seem. With electronics (like many products, unfortunately), there are many components coming from around the globe. For example, many computers (including Apple’s) contain an Intel processor. Those are manufactured around the world – Intel has plants has plants in the US, Israel, Ireland and China. So Apple products will be “Assembled in the USA”, not so much “Made in the USA”.
Also Cook has suggested that Apple is planning to build more of the Mac’s components domestically, but with partners. So don’t look for a big Apple factory coming to a town near you. He told Bloomberg Businessweek that Apple’s domestic plan “doesn’t mean that Apple will do it ourselves, but we’ll be working with people, and we’ll be investing our money.”
And sadly, the return of American production/assembly of computers and electronics doesn’t necessarily mean an increase in American jobs. The future of the electronics industry is swiftly going to the robots. Specialized robots are already building the key pieces of computers. As the NYTimes reports, “The most valuable part of the computer, a motherboard loaded with microprocessors and memory, is already largely made with robots.” What do humans do? Fit in batteries and snapping on screens. Pretty boring, but I guess someone (with an opposable thumb) has to do it.
So all in all, I’m kinda busting your bubble. But it is good to know you can – and should – buy American-assembled computers.
Boston University professor Andre Sharon makes a good, although Negative Nancy-esque, point about the current “reshoring” of some American industries. “I find it hard to see how the supply chains that drive manufacturing are going to move back here. So much of the know-how has been lost to Asia, and there’s no compelling reason for it to return. It’s great when a company says they want to create American jobs — but it only really helps the country if those are jobs that belong here, if it starts a chain reaction or is part of a bigger economic shift.”
So what can we do as American consumers and workers?
- Support American companies that manufacture, and yes, even assemble, their goods stateside. This will help show companies that this trend of domestic production is long-lasting and worth investing in.
- Push schools to educate our children in “the know-how” that’s been lost to Asia
- Focus now on bringing back American jobs and rebuilding industries that America excels in – automobile production and clothing, among others, first.
So don’t feel too guilty when purchasing Asian-made electronics this holiday season. Look for more “Made in the USA”/”Assembled in the USA” goods next year and let’s continue to push Mr.Cook and others to bring production back our way, even if it’s in bits and pieces, and applaud him for making this change.