Tuesday, August 2, 2011

Chinese workers are being replaced by robots

The West used to shudder at the thought of the vast low-cost labor pool in China, and dreaded the undercutting of its own manufacturing firms. It still bought the lower cost imported goods at Walmart, though.

Now one of the largest employers in China of all, Taiwanese-based Foxconn, announces it intends to replace a large proportion of its 1.2 million workers in China with robots.

This is potentially one of those stories that turn out to be historic marking points.

It shows the downward pressure on manufacturing employment applies everywhere. And it has implications for China's future. If you have an automated plant with few or no labor costs, a location six thousand miles from your main markets becomes more unattractive. There are fewer reasons not to put the plant in New Jersey or Turin.

No comments:

Post a Comment