Saturday, July 1, 2017

For these reasons, manufacturing the iPhone in the United States will not give more employment


It is public knowledge Donald Trump's request for Apple to manufacture the iPhone in the United States , with the unfortunate phrase "We are going to force Apple to build its damn computers in this country instead of in other countries . "
Many opinions were against this measure, saying that the cost of production of the devices would be much higher than the current one affecting the final price that each user pays for an iPhone or any other Apple device. Despite this, some news seemed to confirm that Apple would be yielding to this "pressure" by the current president of the United States, such as the possible opening of a Foxconn plant on US soil .
Difficulties in making iPhone in the United States
An employee reviewing the fabrication of an iPhone

Making the iPhone in the United States, a bad idea

Apple currently manufactures its iPhone in China , more specifically in Foxconn and Pegatron plants  These plants are completely automated and have all the infrastructure to perform this task, but also the workforce is fully qualified and wages are lower than the average of US employees . In addition the Chinese government has encouraged the installation of these real industrial cities, offering many tax advantages.
Although China offers an excellent alternative to make Apple products, there are many who believe that it should move to the United States . As Bloomberg explains  in his report, there is reason to say that the manufacture of iPhone and other Apple products in the United States would not bring more job offer .
Foxconn could manufacture iPhone in the United States
Foxconn could open a factory in the United States

Lower wages in China and proximity to suppliers of components

While the low salary of Chinese employees may seem to be the main reason why Apple manufactures many of its products in China, Bloomberg says in its report that it represents only 2.2% of the average cost of each iPhone. 
The proximity of the different suppliers of components to the Chinese factories represents one of the biggest advantages when producing the products in the Asian country, offering a smaller transfer of the components and, consequently, a lower final cost.

Seasonal Labor

While iPhone production takes place throughout the year, the greatest demand comes during a short period of time that includes the months before and after the launch of the new devices. 
In this way the high demand for employment would be only temporary , having to leave much of the staff in suspension.

Not very encouraging experiences

Under different circumstances, Apple has decided to manufacture some products in other countries. Currently Apple manufactures iPhone SE in India  to meet local demand and tax requirements of the Hindu government .
A somewhat negative experience was the manufacture of some iPhone 4s in Basil , back in 2011, where the hired labor represented only a fraction of the expected by the Brazilian government .
For all this, it seems that the manufacture of the iPhone in the United States would not be a viable option for Apple and would not bring an increase in employment in that country . 
Yet Donald Trump has met with the Foxconn CEO , so some devices or accessories might be manufactured in the United States.
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