The NY Times had a great article on Apple and why Apple employs so few people in the U.S.: Apple, America, and the Squeezed Middle Class. We’ve talked about Tyler Cowan’s Great Stagnation and how Google, Twitter, and Facebook don’t need lots of bodies to make their products, but Apple, a company that manufactures electronic components, does need lots of people. They just don’t hire them here. Apple made $400,000 per employee last year, in large part because they outsource their work overseas. Apple says that the labor costs aren’t the major reason for outsourcing, that there are other logistical reasons for centralizing their work in Asia. But when Foxconn, the company that assembles iPhones, pays many of its workers $17 a day, it’s a bit hard to believe that labor costs don’t play a role.
Check this out:
The facility has 230,000 employees, many working six days a week, often spending up to 12 hours a day at the plant. Over a quarter of Foxconn’s work force lives in company barracks and many workers earn less than $17 a day. When one Apple executive arrived during a shift change, his car was stuck in a river of employees streaming past. “The scale is unimaginable,” he said.
And that’s the hard part about all this. If we assume that labor costs aren’t that big of a deal (I don’t believe this, but let’s accept it for the sake of argument), it’s still hard to expect Americans to leave their families and occupy dorms where they work 6 days a week, 12 hours a day, and are on call if anything needs immediate attention. I’ve heard some Chinese calling Americans “lazy” for not wanting to do this, but is that really fair? Does it make sense for people used to living in the middle class to sacrifice everything for their company, living apart from their families and lives outside of work?
Akrypti from 8Asians posted this excellent piece a while ago on Chinese factories, and I agree that these megacompanies are making life better in China. These jobs are better than many others in the region, so it’s hard to accuse Apple of exploiting Chinese if the Chinese want these jobs. Instead, I think these companies are exploiting Americans. Their intellectual property and physical resources are protected by the American government and military, which is funded by American taxpayers, many of whom are denied employment by these companies which either subcontract out their work to countries with lower standards of living or only hire H1B visa holders. One might even well argue that their robust sales come from the fact that they are American companies.
As for Americans, I’m sure some people will read this and point to a defect in American culture, a kind of middle class entitlement that Americans seem to have. I agree with these people that many Americans do feel entitled (see AM/AF Couple’s excellent comment here), but I also think it’s perfectly fair to ask American companies to hire Americans who pay taxes into a system that makes their work possible.
I think the best response I’ve seen to this whole “lazy American” complaint is here, where a blogger responds to the marine in the picture below:
The blogger Max Udargo writes:
Do you really want the bar set this high? Do you really want to live in a society where just getting by requires a person to hold down two jobs and work 60 to 70 hours a week? Is that your idea of the American Dream?
Do you really want to spend the rest of your life working two jobs and 60 to 70 hours a week? Do you think you can? Because, let me tell you, kid, that’s not going to be as easy when you’re 50 as it was when you were 20.
And what happens if you get sick? You say you don’t have health insurance, but since you’re a veteran I assume you have some government-provided health care through the VA system. I know my father, a Vietnam-era veteran of the Air Force, still gets most of his medical needs met through the VA, but I don’t know what your situation is. But even if you have access to health care, it doesn’t mean disease or injury might not interfere with your ability to put in those 60- to 70-hour work weeks.
And that’s the issue with American “entitlement.” One feels spoiled by asking for decent working conditions, but do we really want to live in a world where a person is forced to give his entire life for pure survival? And is it really fair for companies to rely on the protection of the American government paid for by American workers who can no longer get jobs because American companies won’t hire them? As Ha Joon Chang mentions in 23 Things, capital has a nationality. These companies won’t relocate–they know that their livelihood is dependent on being in America. While the rich are buying off the government with their lobbyists, it should be still possible to form a voting block that can deliver justice to the American people.