Friday, November 02, 2012

America - Wake Up! Get Smart or Get Left Behind

Many people decry the loss of the low skill manufacturing and textile jobs to China and other low cost labor markets.  What these people don't seem to understand is this isn't what is hurting the USA economy.  The USA has to import skilled labor because our schools are producing kids who can't read, think critically, or function in the world of high skilled, high tech engineering.  A lot of community colleges have to teach adults basic reading and writing before they can do freshman level college work!  Our K-12 education system has some bright spots, but on the whole the system is broken.  That's another blog entry for another time.

I work with a lot of brilliant people from India, other parts of Asia, and a growing number of Eastern Europeans who are highly educated software engineers, electrical engineers, and trained scientists.  American schools are not producing enough intellectual talent for high tech companies like Apple, Google, Amazon, Intel, and Texas Instruments, so we import these skilled workers.  Why can't we produce these skilled workers here?  Rather than crying about lost low wage labor jobs and creating protectionist policies to protect low skill labor markets, the USA needs to refocus our efforts on education and moving into the 21st century of knowledge work. Here's an excerpt from an article on how both Romney and Obama flubbed this point in a recent debate.  Below is what I wish I had written, but Arik Hesseldahl said it much better than I could have.

Source:  How Obama or Romney Should Have Answered the iPad Question

...some people might get frustrated when they see Chinese workers assembling iPhones.  It’s easy to think that those jobs rightly belong in America.  The reality is a little more complex, but when you understand it, there’s a surprising amount of good news for American workers.

The fact is, assembling iPhones and iPads is the final step of a complex process, and is really a low-skill, low-cost kind of job.  China has spent decades building much of its economy around these low-skill jobs, in part because it has such a large labor force and plenty of workers who are willing to do the work.  And, frankly, here in America you wouldn’t want to try to support a family on the kind of wages a job like that would pay.  I know it sounds harsh, but it’s true.  So I know this may sound odd when I say it, but I ask you to hear me out: I’m perfectly comfortable letting those kinds of jobs go to China or somewhere else.

In fact, some researchers at the University of California at Berkeley found that for every iPad or iPhone manufactured, Chinese workers add $10 or less to the value of an iPad or iPhone.  On an iPad, they found that American workers add $162 worth of value, and on an iPhone it was more than twice as much.

In America, when we talk about manufacturing, we should be talking about advanced manufacturing jobs for highly skilled workers that require a solid education and pay wages on which you can support a family.  And the fact is, there’s a lot of American work that goes into an iPad or an iPhone or a Mac.

For one thing, there’s our semiconductor companies, like Intel, an American company that makes the most advanced and complex device ever created — the microprocessor — and that does it better than any other company in the world.  It makes the primary brain that goes inside the Mac, most of the world’s personal computers and most of the servers that power the Internet.  And most of those chips are made right here in California and Arizona and Oregon.  Some are made in Israel, too.  But most are made here in the U.S.A.

And the microprocessors that go inside the iPad and the iPhone are made right here in America, too.  Apple doesn’t make its own chips, and when it went looking for another company to help it do that, it picked a Korean company called Samsung.  And where did Samsung decide to build these chips?  Some place in Korea?  No.  The answer will surprise you: Texas.  That’s right.  Samsung operates one of its very biggest chip factories in Austin.

Then there’s the shatter-resistant glass that you touch every time you use an iPhone or iPad.  It was invented in America.  And it’s made in America, too, by American workers at a company called Corning, in Kentucky and New York.

And that’s just one piece of it.  There are a lot of other great jobs held by American workers.  Apple has a lot of smart designers who sweated over every little detail of how the iPad and iPhone look, and how they feel in your hand, and how the button works.  Teams of software developers slowly, painstakingly designed and built and tweaked and refined the software that makes it so fun and useful.

And we’re not done there.  If you have an iPhone or an iPad, you have a favorite app.  Right now, my favorite app is the one created by my campaign staff.  And when I take a break on the campaign bus, my wife and I like to relax for a few minutes playing Words With Friends.  She beats me every time.  And how many apps are there?  A million?  A zillion?  But that’s an example of another American company, Zynga, creating jobs for the people who create game software.  And there are lots more Zyngas, some of them really small companies with just a few people, and some a lot bigger.  Apple once counted, and said that there were more than 200,000 people working at jobs just making apps.

And let’s not forget that just a little more than five years ago, this branch of the technology industry didn’t exist at all.  Apple brought out the first iPhone in 2007, and the first apps started coming to the marketplace in 2008.  And don’t get me started about Google and its Android phones and tablets, and the chips and software that go into those.  Or Facebook, and all the interesting things it’s doing.

...I’m not terribly worried that American workers aren’t assembling iPhones and iPads in America.  They’re busy doing more important jobs, and earning good wages doing it right here in America.  [We must] do everything in [our] power to help encourage the creation of more jobs right here in America, and to encourage entrepreneurs to start new companies so they can create the next Apple or Google or Intel or Facebook.

It’s something we in America do better than anyone else.  And we can argue about the details of how we should go about doing that.  ... [W]hen I look at the iPhone and the iPad, I see something that could only have happened in America.  And I feel pretty good about the role the American worker plays in it.  And so should you.

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