[cantrevealname]

> AI and robotics nullify any comparative advantages low wage countries had

If we project long term, could this mean that countries with the most capital to invest in AI and robotics (like the U.S.) could take back manufacturing dominance from countries with low wages (like China)?

[adev_]

> could take back manufacturing dominance from countries with low wages (like China)?

The idea that China is a low wages country should just die. It was the case 10y ago, not anymore.

Some part of China have higher average salaries than some Eastern European countries.

The chance of a robotic industry in the US moving massively jobs from China only due to a pseudo A.I revolution replacing low paid wages (without other external factors, e.g tarifs or sanctions) is close to 0.

Now if we do speak about India and the low skill IT jobs there. The story is completely different.

[sleepyguy]

> The idea that China is a low wages country should just die. It was the case 10y ago, not anymore.

The wages for factory work in a few Eastern European countries are cheaper than Chinese wages. I suppose they don’t have the access to infrastructure and supply chains the Chinese do but that is changing quickly do to the Russian war against Ukraine

[ceronman]

China dominance in manufacturing, at least in tech, it's not based on cheap labor, but rather in skills, tooling and supply chain advantages.

Tim Cook explains it better that I could ever do:

https://www.youtube.com/watch?v=2wacXUrONUY

[themaninthedark]

But it's not like China had the skills, tooling and supply chain to begin with....and it's not like the US suddenly stopped having all those things. There are reasons manufacturing moved out of the US and it was not "They are soooo much better at all the things over there!"

Tim Cook had a direct hand in this and know it and is now deflecting because it looks bad.

One of the comments on the video puts it way better than I could:

@cpaviolo : "He’s partially right, but when I began my career in the industry 30 years ago, the United States was full of highly skilled workers. I had the privilege of being mentored by individuals who had worked on the Space Shuttle program—brilliant professionals who could build anything. I’d like to remind Mr. Cook that during that time, Apple was manufacturing and selling computers made in the U.S., and doing so profitably.

Things began to change around 1996 with the rise of outsourcing. Countless shops were forced to close due to a sharp decline in business, and many of those exceptionally skilled workers had to find jobs in other industries. I remember one of my mentors, an incredibly talented tool and die maker, who ended up working as a bartender at the age of 64.

That generation of craftsmen has either retired or passed away, and the new generation hasn’t had the opportunity to learn those skills—largely because there are no longer places where such expertise is needed. On top of that, many American workers were required to train their Chinese replacements. Jobs weren’t stolen by China; they were handed over by American corporations, led by executives like Tim Cook, in pursuit of higher profits."

[hombre_fatal]

> it was not "They are soooo much better at all the things over there!"

Though I think we should also disabuse ourselves of the idea that this can't ever be the case.

An obvious example that comes to mind is the US' inability to do anything cheaply anymore, like build city infrastructure.

Also, once you enumerate the reasons why something is happening somewhere but not in the US, you may have just explained how they are better de facto than the US. Even if it just cashes out into bureaucracy, nimbyism, politics, lack of will, and anything else that you wouldn't consider worker skillset. Those are just nation-level skillsets and products.

[bcrosby95]

Hence "had the skills" and "was not". They are not making claims about the present day, they are talking about why the shift happened in the first place and who brought it about.

[hombre_fatal]

Good point. When I commented, the sentence I quoted was the final sentence of their comment essentially leaving it more abstract. Though my comment barely interacts with their point anyways.

[themaninthedark]

Sorry. I was typing, got distracted and submitted before I meant to. I thought I had edited pretty quickly, normally I put an edit tag if I think too much time had elapsed.

[Aurornis]

Manufacturing isn’t one uniform block of the economy that is either won or lost. US manufacturers focus on high quality, high precision, and high price orders. China excels at factories that will take small orders and get something shipped.

The reason US manufacturers aren’t interested in taking small volume low cost orders is that they have more than enough high margin high quality orders to deal with. Even the small-ish machine shop out in the country near the farm fields by some of my family’s house has pivoted into precision work for a big corporation because it pays better than doing small jobs

[themaninthedark]

I would say, it pays more consistently than small jobs. As by nature small jobs are not generally continuous, most often piecemeal.

The other factors are: In any sort of manufacturing, the only time you are making money is when the equipment is making product.

If you are stopped for a change over or setup you are losing money. Changing over contains risk of improper setup, where you lose even more money since you produce unusable product.

Where I live, the local machine shops support themselves in two way: 1. Consistent volume work for an established customer. 2. Emergency work for other manufacturing sites: repair or reverse engineering and creating parts to support equipment(fast turn around and high cost)

They are willing to do small batches but lead times will be long since they have to work it into their production schedules.

[Teever]

Probably not because America lacks the blue collar skills necessary to build and service the kind of manufacturing infrastructure needed to do what you're describing.

[thisoneworks]

Hard disagree. You can't just one day wake up and double your energy infrastructure.. China is way ahead.

[daymanstep]

China has more robots per capita than the US

And the idea that China has low wages is outdated. Companies like Apple don't use China for its low wages, countries like Vietnam have lower wages. China's strength lies in its manufacturing expertise

[signatoremo]

Manufacturing expertise that have been transferred from the West over the last 40 years. Knowledge and expertise are fluid, they can go both way, they can be transferred to other countries as well, India, Vietnam, etc. The world doesn’t stand still.

[daymanstep]

I don't get why I was downvoted. I didn't say anything that contradicts what you just said.

[mensetmanusman]

Western engineers worked relentlessly on knowledge transfer to China to do so, it might be easy to bring back with the 10x industrial subsidies that the CCP provided to do so.

[daymanstep]

And the US is already starting to do it, for example partnering with South Korea or Japan to rebuild American shipbuilding.