[TowerTalk] AES SK

Mon Jul 11 23:06:48 EDT 2016

I would second these views having had plants in the US, Asia, and 
Europe.  While local politics often "encouraged" local manufacturing, in 
the end the most efficient producer environments win.  When countries 
make it an objective to be competitive on a global scale and have good 
leadership they often achieve that goal - witness Singapore's history.

Engineering as a profession is "too hard" for many US students, PolySci 
is easy but then graduates wonder why their jobs are in retail or food 
service.  A recent major magazine article was about the "crushing 
college debt" of many students and their inability to pay.  NOT ONCE did 
it mention the career choice of the students profiled - DUH.  When I 
introduced 6-Sigma statistical process control to my operations and 
checked on "how is it going?" at a plant, the plant manager said, "we've 
hit a snag, we have to teach much of the workforce how to add and 
subtract."  The failure of US public education to produce a workforce 
educated for the jobs of today is appalling.  In Asia, the skills needed 
were there and the techniques enthusiastically embraced by the labor 
force.  The "top 5%" are a much larger population besides.

Consider that the Philippines graduates more engineers (5 year program, 
accredited) than the USA.  There aren't the MIT, Stanford, or Berkeley 
PhD level institutions, yet.  The degrees granted focus heavily towards 
the semiconductor industry (BS/MS EE & CS). Now they are rapidly 
up-skilling into test design,  design spins, and then original designs 
and that work is being off-shored by US companies.  TSMC (Taiwan) didn't 
become the largest semiconductor company in the world by accident.

Cheapest labor is less important as automation has reduced the 
handwork.  Years ago the garment makers realized that computer driven 
sewing machines were changing the game.  The latest and most productive 
machine tools cost the same everywhere in the world and it is the 
innovation in them and the workforce skill to optimize their performance 
that makes a difference.   That takes a very skilled labor base.   Then 
there are the regulations and bureaucracy.  Many years ago Andy Grove 
(SK) promised California he would not build another Intel plant in CA 
unless the state fixed its bizarre permitting and tax/regulatory 
burdens.  I had to LOL when the press and politicians 10 years later 
bitched that Intel was building all plants elsewhere.  It took me 6 
years and many dollars to get a single family home building permit in 
Santa Clara County, on a large property with ZERO issues.  Now I don't 
live in CA. People and companies can vote with their feet.  Especially 
with the incentives, skilled labor, low taxes, and streamlined 
permitting offered by competing political entities.  SiVly is propping 
up CA finances for now, watch out when startup stock options aren't "in 
the money".  The rest of CA is in the tank, just drive through the 
Central Valley.

I've been buying machine tools and tooling for the last 25 years. The 
three most scary words 15 years ago were "Made in India."  In the past 
year, several items I've purchased had that dreaded marking, but are 
first class.  Maybe not Hardinge or Starrett level yet, but so close as 
to not be important to me.  Several of the well known but lesser brands 
are now India made.

Grant KZ1W

On 7/10/2016 20:27 PM, Roger (K8RI) on TT wrote:
> Overly simplistic with the reasons for ham gear as well as many 
> products off shore include all the things someone said were unrelated. 
> Unions, politics, skilled and unskilled labor, work ethics, 
> unrealistic expectations and attitudes taught all the way through the 
> school system.  Add to that the global market system.
>
> The company I worked for had numerous plants around the US.  There are 
> many states that welcome new industries with minimal regulations and 
> taxes. Unfortunately the Feds regulations can make starting a new 
> business anywhere, more than a little difficult.
>
> We had plants on nearly every continent to take advantage of those 
> "local markets"
>
> "Ham Radio" is no where near a large enough market to support that 
> kind of business model.
>
> "Off Shore" does not mean junk, but as long as most hams are cheap, 
> someone, here or there will build and sell "cheap stuff". Let's face 
> it. If WE didn't purchase enough cheap stuff to support the making of 
> cheap stuff, then they'd stop making cheap stuff.
>
> You don't need to be very old to remember when Japan was synonymous 
> with cheap stuff.
> Those producing cheap stuff soon learn there is a lot more money in 
> building "good stuff"
>
> "Cheap labor" has a way of becoming expensive labor.
> Japan was replaced by Korea and Mexico. Now why would Japanese 
> companies start building cars in the US?  It doesn't take long for an 
> open mind to find those answers.
>
> Korean cheap labor is being replaced by Chinese and Indian labor.
>
> A thought:
> I read that in another generation or two, India will have more people 
> with 4 year college degrees than the total US population. Can China be 
> far behind?  They have highly qualified people who WANT to work, while 
> we have many college grads who want to tell their employers what they 
> will do.  I've seen a drastic change in new hire attitudes in my 50 
> plus years in industry
>
> Whoever remarked about the falling # of Hams needs to read 
> http://www.arrl.org/news/amateur-radio-showing-steady-growth-in-the-us
> True, fewer build their own HF and VHF rigs, but LF and SHF are now 
> the domain of the home builders. OTOH many of the new hams with store 
> bought equipment understand the programming and protocols for some 
> very sophisticated communications that leave old time CW and SSB hams 
> scratching their heads?
>
> All of these things/topics affect Ham Radio, one way or another.!
>
> 73
>
> Roger (K8RI)
>
>
> On 7/9/2016 Saturday 3:55 PM, David Gilbert wrote:
>>
>> That's a bit simplistic.  I spent over 30 years working for a huge 
>> North American based semiconductor company, and there were a variety 
>> of reasons we ended up moving most manufacturing elsewhere.  Labor 
>> cost was certainly one of them, but rarely the deciding factor.  
>> Others included:
>>
>> 1.  Availability of trained engineers.  Places like China and India 
>> have a far greater pool of highly skilled and dedicated engineers, 
>> and engineers in the U.S. tended to think of manufacturing as being 
>> "unglamorous."
>>
>> 2.  Proximity to local markets.  As the world economy became more 
>> global, being able to be closer to your customer had tremendous 
>> advantages in terms of customer relationships and cycle time 
>> reductions, not to mention trade (many countries lower tax rates for 
>> local content) and currency issues.
>>
>> 3.  Bureaucracy and overhead issues.  At one point we wanted to 
>> significantly expand a wafer fab locally, but were told by the city 
>> that it would take at least 18 months simply to get the approvals for 
>> it ... in spite of the fact that we had already proposed every safety 
>> and environmental upgrade imaginable for it.  Markets don't wait for 
>> that kind of crap, and we ended up having to build the fab offshore 
>> where some other entity actually wanted it.
>>
>> Other industries faced different issues ... tax burdens in the U.S., 
>> ridiculous union requirements (much less of an issue now, of course, 
>> at least in most places), availability of raw materials, etc.  The 
>> problem as many of us recognized even back then was that once such 
>> manufacturing migrations begin they are very difficult to curb.  How 
>> many colleges and universities in North America offer engineering 
>> courses specifically geared toward manufacturing?  Damn few, if any.  
>> In Asia they are everywhere. Compare tax rates.  Compare 
>> transportation costs to major markets (North America is no longer the 
>> only one).
>>
>> The list of reasons why such "big box" products are built elsewhere 
>> is almost endless, and while it may be convenient to blame the 
>> manufacturers for that it is simply scapegoating. Consumers who tend 
>> to buy the cheapest available product regardless of quality (and they 
>> are still the majority, to which I can attest having worked for a 
>> while at a big box store) share the blame, as do most other elements 
>> of the economic system that ignored cost and efficiency in favor of 
>> other factors.   I'd even bet that your own investment funds lie with 
>> companies that make as much profit as possible, as opposed to some 
>> company that tried to fight the system by paying higher wages, paying 
>> higher taxes, training it's own engineers, paying higher 
>> transportation costs ... etc, etc, etc.
>>
>> Manufacturers mostly follow ... they don't really lead the parade.  I 
>> can say with great experience that moving manufacturing offshore is 
>> one of the riskiest, most traumatic actions a manufacturer can take.  
>> It doesn't happen without significant outside pressure from one place 
>> or another.
>>
>> 73,
>>
>> Dave  AB7E
>
>
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