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Foxconn Cuts 60,000 Jobs, Replaces With Robots (thestack.com) 415

An anonymous reader writes: In a bid to accelerate growth and reduce labor costs, Apple supplier Foxconn cut 60,000 jobs at a single factory, work that is now being completed by robots. As many as 600 companies in the Chinese manufacturing hub of Kunshan may have similar plans to automate their workforce, according to a government survey. Foxconn spokesperson Xu Yulian said, "The Foxconn factory has reduced its employee strength from 110,000 to 50,000, thanks to the introduction of robots. It has tasted success in reduction of labor costs." He added, "More companies are likely to follow suit."

These changes are spurred in part by a desire to reduce labor costs, but have also been made in response to an explosion at a Kunshan factory in 2014 that killed 146 people. The explosion was attributed to unsafe working conditions in the Taiwanese-owned metal polishing factory, which were recognized and documented. After the explosion, the local government pledged 2 billion yuan per year in subsidies to support companies that install industrial robots on their production lines.

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Foxconn Cuts 60,000 Jobs, Replaces With Robots

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  • by cant_get_a_good_nick ( 172131 ) on Wednesday May 25, 2016 @10:55AM (#52178983)

    Those who say "we're going to build our economy by bringing back manufacturing" are deluding themselves. Those who vote for those people are also deluding themselves. (yes, this is a not so veiled Trump reference)

    • robots will just push the manufacturing back to us where they get faster and cheaper shipping.

      • robots will just push the manufacturing back to us where they get faster and cheaper shipping.

        You really haven't thought this thing through.

        • by wbr1 ( 2538558 )
          Maybe he has.

          If a factory in north america can make the same product with the same robots as one in china, then shipping costs become an unneeded expense.

          However that leaves other costs for: remaining workforce, labor, enviromental and tax laws that may be favorable elsewhere, capital expenditure to build new factories, etc.

      • End good sure, anything thats messy and dirty will stay there due to epa regs. Or more correctly shift to whatever country has lax regs at the time.

      • You think we can do robotics cheaper than China? That is a laugh...... All the new robotics equipment is made in China.
        • No, all the new robotics equipment will be made in the U.S. by robots.
        • by imgod2u ( 812837 )

          Ya, the US kinda shot itself in the foot. In a race for cheaper labor, it moved all that manufacturing infrastructure and expertise to China. The US government refused to spend while the Chinese poured billions into transportation and seed money to kickstart their world-class manufacturing industry.

          It's no longer the case that China is just cheaper -- they simply do it better and on a more massive scale than anything the US could hope to do. The supply chain and business logistics alone is a nightmare to tr

      • You know, if you plan to compete with robots for jobs, it usually involves whips and people singing funny-sad songs...

      • by rch7 ( 4086979 )

        Why should they? All the electronics engineers and component suppliers are in China, not US. You can't bring anything to empty place, you need to have whole ecosystem and it is long gone.

    • That doesn't mean there'll be anyone working in the factories!

    • Manufacturing jobs will go where the labor is cheap. At some point, labor prices will increase globally and automation will be more cost effective for some tasks. We are finally seeing this in China. The huge labor pool is drying up and prices are increasing.
    • As opposed to those who say education and innovation are going to provide mass jobs?

      (yes, this is a not so veiled progressive reference)

    • by dj245 ( 732906 )

      Those who say "we're going to build our economy by bringing back manufacturing" are deluding themselves. Those who vote for those people are also deluding themselves. (yes, this is a not so veiled Trump reference)

      Why are such people deluded? A strong manufacturing sector seems to be working fine for Germany. The difference is that they don't just pay lip service, they implemented good training programs, apprenticeships, change labor laws to make the bar for terminating a worker more reasonable, etc. Their politicians got it done. You can doubt that US politicians can accomplish something like that (they probably can't), but it isn't delusional in principle.

    • by Livius ( 318358 )

      But the argument will be far more persuasive if someone credibly *tries* to bring the jobs back and is unsuccessful. It has *not* been tried yet.

  • Robots are cheaper than Chinese labor now?
    • Re:Interesting (Score:4, Insightful)

      by Viol8 ( 599362 ) on Wednesday May 25, 2016 @10:57AM (#52178993) Homepage

      Yeah, I was wondering that. Surely if robots are cheaper manufacturing can be brought back home now? Whats the advantge now of making stuff in china with all the associated shipping costs?

      • Robots still suck at some things -- sewing complex shapes (like teddy bears and backpacks) for example. The cost comparison has to take into account the type of work performed, but as the robotics improve in capability and drop in price more and more things will pass the lowest labor thresholds; it seems hard to believe there's any way around that.

        • by marciot ( 598356 )

          Robots still suck at some things -- sewing complex shapes (like teddy bears and backpacks) for example..

          Hopefully there will be robots writing better manuals for products; given the ones I have seen coming out of China, this would be a fairly low bar for AI to reach.

      • It is already happening. And with the push of 3D printers, and advanced CNC milling machines and so forth, the actual people who will thrive are the ones that can see a problem, cut a solution out in a CAD program, Mill and Print the parts needed and sell or license the patents off. You did patent the idea, right?

        Unskilled, semi-skill laborers that can be replaced by robots, need to be replaced by robots. In the future, the real wealth will be created by those that are creative, artistic, and highly skilled

      • > if robots are cheaper manufacturing can be brought back home now?

        It has been happening for the last few years. More and more manufacturing is coming back to the USA for exactly that reason, but for the same reason there aren't any manufacturing JOBS coming back:

        http://www.governing.com/gov-i... [governing.com] "Manufacturing Is Coming Back. Factory Jobs Aren’t."
      • Yeah, I was wondering that. Surely if robots are cheaper manufacturing can be brought back home now?

        If robots are doing the jobs, why would you want manufacturing to come back home? What good is having a factory where there are no jobs, owned by a company that is incorporated in a tax haven?

        • by imgod2u ( 812837 )

          Technically, if the factory resides in the US, they need to either pay import taxes on materials coming in and export taxes on shipping products out, or pay corporate income tax on products sold domestically.

          There are advantages, although clearly not as big of an advantage as having to employ people.

          Though people do get employed, just not as many.

        • If robots are doing the jobs, why would you want manufacturing to come back home?

          1. Lower shipping costs
          2. National security
          3. A major expense in manufacturing is energy. Energy prices for electricity and gas are much lower in America than in East Asia.

        • reduce shipping & import tariff costs.

          Imagine being able to build/clone a manufacturing site in each country of your customers. Cheaper & quicker shipping, no tariffs, maybe even local tax breaks.

          Why would you NOT do this?

      • by RobinH ( 124750 )
        Robot cells here cost more money and a lot of that increase in cost can be attributed to the additional safety restrictions we put on robot cells in North America or Europe. I'm in industrial automation and a very significant amount of design time for any automation cell goes into safety design. I'd imagine those restrictions are a lot lower or non-existent in China.
      • Re:Interesting (Score:5, Informative)

        by Tailhook ( 98486 ) on Wednesday May 25, 2016 @11:24AM (#52179291)

        The president of Foxconn was asked about this in 2010; why not manufacture in the US using automation? He said, "I worry America has too many lawyers. I don’t want to spend time having people sue me every day.” Labor costs aren't the only concern; the US is a regulatory and political mine field filled with lavishly funded pressure groups that impose huge costs on industrial investment.

        Pointing this out invariably provokes the knee-jerk Sierra club trained response; "so you think the filthy pig-dog capitalists should be allow to pollute everything right?" This is done using some device manufactured in China because the writer couldn't afford to purchase a machine manufactured under the regulator regime he insists on for his own country. So we shit up Asia instead and feather our own regulatory nest.

      • Re:Interesting (Score:5, Insightful)

        by AF_Cheddar_Head ( 1186601 ) on Wednesday May 25, 2016 @11:25AM (#52179299)

        Take a look at the water pollution and air pollution associated with that manufacturing, then take a look at the environmental regulations in the USA versus China.

        Now you have your answer why.

        Cost of labor isn't the only reason that manufacturing has moved to the third world. One of the big reasons that the rivers and air in the USA is cleaner now than in the 50s and 60s is the migration of dirty manufacturing plants out of the USA.

        Decide for yourself if that is good or bad.

      • You can just dump your trash in the river.

    • Robots are cheaper than Chinese labor now?

      See, this is the thing: Robots are cheaper than ANY labor. That's why anyone who tells you that a higher minimum wage is going to force companies to automate are just full of shit. The industrial revolution taught us that corporations will automate when the wage is 25 cents a day. If a company will bring in a machine to a fast restaurant to replace a $15/hr worker, they'll do it to replace a $7/hr worker too.

      The problem is, there just won't be anyone left to buy

    • by Qzukk ( 229616 )

      60,000 people, even at 10 cents an hour, is a lot of money.

      Getting 2 billion yuan to stop killing employees probably helps too.

      • Re:Interesting (Score:5, Insightful)

        by ShanghaiBill ( 739463 ) on Wednesday May 25, 2016 @11:46AM (#52179485)

        60,000 people, even at 10 cents an hour, is a lot of money.

        Average factory wages in China are about $3/hour, not 10 cents. Since prices for many things are much lower in China, $3 buys as much as $10 in America. A Chinese factory worker can't afford a house and a car, but they can afford an apartment and a bicycle.

    • I was wondering that myself. I mean, you have to BUY robots, and maintain them, and program them...

      Humans are so much cheaper than that. You get them for free and you can simply toss them away when they're broken because there's plenty more for free.

  • by Salgak1 ( 20136 ) <.ten.ysaekaeps. .ta. .kaglas.> on Wednesday May 25, 2016 @11:02AM (#52179041) Homepage

    . . . .the trend to automation of mass manufacturing has been accelerating for decades. The REAL question is, what do we do with the displaced manufacturing workers, who are becoming increasingly replaced by robots? And the "service sector" does not have jobs for them, either.

    There is a rather ominous trend when you have a surplus of workers, especially young male workers without prospects. The long term solution is fewer children, as is happening in the West. But all too often, the short-term result is war.

    I'm sure someone will start suggesting "basic income", and as automation increases to the point where we transition to "prosperity economics", that may well be the long-term solution. But getting through the short term is likely to be worrisome. . .

    • . The REAL question is, what do we do with the displaced manufacturing workers, who are becoming increasingly replaced by robots? And the "service sector" does not have jobs for them, either.

      No, but thanks to our new robot bakers, there's plenty of cake for them to eat.

    • the short-term result is war.

      While you guy are at war, I'll be kicking back on my little farm eating homegrown popcorn.

    • by pr0nbot ( 313417 ) on Wednesday May 25, 2016 @11:33AM (#52179383)

      Fortunately, China is a communist society where the people own the means of production, and thus all will get a share of the gains of automation.
      *Puts finger in ear, looks down for a second, looks back up to camera*
      I've just been notified that this is, in fact, not how it works.

  • On the plus side, there's probably less need for railings on the rooftops and pavement cleaning/repair services.
    https://en.wikipedia.org/wiki/Foxconn_suicides
  • by penguinoid ( 724646 ) on Wednesday May 25, 2016 @11:10AM (#52179119) Homepage Journal

    Hey, remember all the crap that was going on about automating the ordering process at Wendy's? Wah wah the job losses? Robots are getting cheaper and humans more expensive. Even China is now automating to save on labor. Sure there's a few countries left, but as jobs go there soon enough they'll earn their way out of poverty too.

    If your job could be done by a robot, it's time to start thinking about a new job. And also time to start thinking about what to do when most jobs are done by robots (owned by rich people or corporations) and almost everyone is unemployed.

    • by pesho ( 843750 )

      And also time to start thinking about what to do when most jobs are done by robots (owned by rich people or corporations) and almost everyone is unemployed.

      Exactly that! There is no cost to labor that is low enough to make it competitive with modern day automation. Talking heads that say minimum wage rises are making companies to switch to automation, don't know what they are talking about (TFA shows that quite well). Sure strawberry picking may still be a human domain, but for how long? Even if human labor was free, it will be hard press to compete with the consistency and productivity that automation brings. So yes, it is time to think how a society will fun

    • If your job could be done by a robot, it's time to start thinking about a new job.

      You realize that is about 90% of America, right?

      • Perhaps 90% of American's jobs could be done by robots, but Slashdotters are likely much safer in that respect (still at risk of outsourcing, of course). If robots start taking over Slashdotters' jobs, then we'll have some interesting times (advanced AI).

  • After the explosion, the local government pledged 2 billion yuan per year in subsidies to support companies that install industrial robots on their production lines.

    what this effectively says is that "workers paid companies to replace them with robots" which is only a good idea if the companies in turn pay to take care of those who lost their jobs. don't get me wrong, full automation is the [inevitable] future and it should be embraced but it will only be sustainable if the benefits of automation are shared rather than consolidated. this is the basis of a post-scarcity world.

  • by Tablizer ( 95088 ) on Wednesday May 25, 2016 @11:50AM (#52179517) Journal

    Mass automation of grunt work and more free time because of it should be a good thing. But, we don't know how to distribute the resulting goods and wealth. We seem to be entering a new phase of history and economics with different rules. It's both exciting and frustrating.

    The economies of "mature" nations are not behaving normally:

    1. The "recovery" is slower than past patterns.

    2. Inflation is too low. Economies tend to do best with inflation around 2.2% (annual), but we've been hovering around 1.7% for a while.

    3. Low interest rates are not triggering investments.

    4. Investors and companies prefer sitting on cash instead of investing.

    Taxing the wealthy heavily is one common suggestion for distributing this "jammed" wealth, but this rubs many people wrong.

    Outright printing money and distributing it to regular consumers is another suggestion (AKA "helicopter money"), but nobody is sure of the side-effects.

    Reducing regulations is another suggestion, but most federal regulations were put in place because one or more organization were doing sleazy things. We don't want to become a 3rd-world dump in order to compete with the 3rd world by polluting more and having abusive working conditions. State-level regulations, which are often passed with less scrutiny, are possibly a better place to clean up bad laws, but require state governments to act.

    What are the other options? We may have to just experiment with one or more of the above, but admitting you are experimenting looks bad, politically.

  • by ThatsNotPudding ( 1045640 ) on Wednesday May 25, 2016 @12:11PM (#52179721)
    One hopes those 60k now unemployed take some time and read up on what Chairman Mao might advise in his Little Red Book - unless CentralParty Corporation has already banned it (along with Das Kapital).
  • by MobileTatsu-NJG ( 946591 ) on Wednesday May 25, 2016 @12:19PM (#52179767)

    This sort of automation only happens when a $15/hour minimum wage is introduced!!

  • by netsavior ( 627338 ) on Wednesday May 25, 2016 @01:19PM (#52180389)
    one factory with 60,000 workers... assuming humane shift times(hah), you could run 3 shifts, so... 20,000 people per shift. That is a HUGE freaking factory... like a basketball stadium full of workers, every shift, in one factory.

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