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Could Dell Be Next to Leave China?

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[citation][nom]tayb[/nom]Maybe if people in the USA didn't think they were worth so much more than they are Dell could bring their manufacturing facilities back here and operate them. Too bad that's a pipe dream because workers here would expect to be paid $15+ an hour doing unskilled work in a factory and then they would unionize and drive up costs even further by demanding outrageous benefits for doing their unskilled labor. If Dell leaves they will be heading to India.I would rather have inexpensive Dell products than ones that had "Made in the USA" stitched on the back in tiny letters.[/citation]
OK, you want as cheap of products as possible, but your rant against American workers overlooks a basic premise to the equation: cost of living. American workers do demand more in wages due to inflated cost of living. Even basics (housing, transportation, health care, food, utilities) are very expensive in many Areas of the US.

It doesn't really matter if the labor is unskilled, the bottom line is the workers need to earn a competitive wage per the cost of living (not what someone in China can do the work). So while you rant on unskilled workers/wages your focus on pure consumerism is also telling. This dynamic has caused such massive economic changes in the US--exporting of jobs, increased imports, government intervention into health care, and the immigration issue (where we "import" cheap labor to people willing to live below poverty levels because they are above the living standards in other countries, all so "natives" can get their $0.99 items at Wally World.)
 
Dell will never come back to the US. Geez people study some economics.

We would NOT want Dell to come back unless you wanted Dell to fail as a company. Their PCs would cost more than Macs. No one would buy from them.

It is not bad that Dell moved out of the US. I hope y'all realize that more countries outsource to the US than we outsource out...If every country did not outsource we would have LESS jobs. It's all about comparative advantage. If the US was only good at manufacturing, our standard of living would plummet since even third world countries can do that well. The US is much more technical and service orientated. That's how we stay on top. Do y'all think the US would stay on top by having its workers make jeans, PCs, and textiles?
 
[citation][nom]aford10[/nom]They could afford to produce them here in the USA again, if the factory workers didn't demand $20 an hour. The ever demand for higher and higher wages is part of what is driving businesses to other countries. A word of wisdom to those unemployed: If a company like Dell did come back to the US(though unlikely) to produce computers, accept a reasonable wage. All it does is drive up the cost of products, and drive the company to another country.[/citation]

First off, coming from the Midwest where manufacturing rules, outside directly working for an tier 1 automotive company there are few factory jobs you can get today that pay above $15/hr, let alone $20. May cap at about $10 (and many of these are automotive suppliers). There are exceptions but you will find more jobs starting below $10 and capping below $15 in the rust belt than the hypothetical $20 you are dreaming about.

As for accepting a reasonable wage, the reverse is: why not accept a reasonable cost on goods? At the end of the day someone has to be the cashier at the grocery store, flip your burgets at McDonalds, and operate the gas station. These same people need to live in the areas they work. Even if they all got better education and work skills SOMEONE needs to do these jobs. I am not saying pay more for products solves the problem, but blaming American workers for wantint competitive wages in regards to the cost of living in their neighborhoods isn't quite on target.

As for Dell, I have seen first hand how Dell wins support contracts. $12 is what they pay when they win a contract and aim to collect disposed IT staff. And they mainly aim to snag these people for companies that REFUSE to accept Dells much cheaper off seas support staff.
 
An update to this, Dell doesn't haven't any plans of moving production from China to India, they believe India has the same potential for being a hardware hub as China does.

[There is] a misunderstanding of what Mr. Dell and the Prime Minister discussed. In fact, Mr.Dell met with Prime Minister Singh to discuss ways of building India's hardware manufacturing eco-system. In this context, Mr. Dell said that the company spends approximately $25 billion annually on sourcing components from its suppliers in China. With the right kind of progress, Mr. Dell believes that India also has an opportunity of becoming a hardware manufacturing hub, generating employment and adding to the country's impressive growth. Dell HAS NOT made any plans to shift its component spend at this time.

-Via DailyTech

For those of you interested.
 
[citation][nom]christop[/nom]Why pay Americans 10 to 15 an hour when you can get other people to do it for 3 dollars an hour.. Maximize greed I mean profit..[/citation]

From a pure fiscal perspective it makes a lot of sense--you can hardly fault CEOs from moving overseas when they are beholden to stock holders to make as much money as possible.

That said these sort of business practices are short sighted. While it is commonly stated that moving these jobs overseas raises the standards of living in other countries (often true) some of the major reasons these companies move is to avoid labor laws regarding work hours, safety conditions, and the like. Another is environmental regulations. It would be niave to believe that the outsourcing of American industry has resulted in a cleaner world or better living conditions across the board. I think the picture is quite mixed and very little attention has been paid to the consequences of these actions domestically and abroad.

These jobs aren't coming back, but from an American perspective we need to ask what standards are we holding US firms overseas as well as to foreign made products? And what is being done to fill the void for vacated jobs? Does it do general economic health to export jobs and leave a vacuum of unemployed workers? It would be nice if our elected officials spent time working on real issues instead of furthering their own political careers. I don't think there are easy answers to these issues, but the consumer-driven economy will eventually fail. In this regards the recent recession is GOOD. There needs to be market corrections. I know how owners are mad, but their properties were overvalue and the moves to protect banks and home owners only delays the inevitable.
 


I live in the heart of the automotive area, smack dab in michigan. I know how much the average joe was making on the lines. Just a few years ago, when I was looking for different jobs, I found several in the area paying $17 - $25 an hour in different auto/autoparts plants. It's not a dream at all.

Your argument is backwards. We don't need to make more $$ to keep up with cost of living. If companies didn't pay so much in salaries, pensions, 401k, bonuses, etc..., the cost of goods/living wouldn't be nearly as high. To see proof of that, just compare cities like NYC, and Toledo, OH.

This is why the minimum wage increase only hurts those you mentioned who work flipping burgers, at grocery stores, and gas stations. The companies they work for just increase the price of their goods, and pass the cost on to the customers. I used to work in fast food, also at a grocery store, and can tell you that most who worked there, also shopped there. So the increase in cost of goods, was easily more than the $15-$25 a week increase in pay.
 
"They would like to shift to safer environment with climate conducive to enterprise with security of legal system"

Talk about a big slap to the face to China
 
I'm not an economist, but here's my take on American businesses in general...

I beleive the American workforce is productive...I don't have specific data, but I'd be willing to bet that we are more productive than we give ourselves credit for.

With that being said...Labor costs are not why businesses choose to manufacture outside the United States...this is usually one of the LAST reasons to move operations.

It has been my experience that direct labor is almost an insignificant part of the manufacturing process.

Example:

How long does it take to fully assemble a dell computer??? I don't know but I'd be willing to bet that the ACTUAL assembly time is less than 30 minutes...Figure an assembly line, with specialized workers, doing only ONE task...the amount of time it takes to build a home computer is not long at all for some experienced builders...less than 3 hrs. To say that labor is the reason Dell does not bring it's manufacturing back to the US is just a joke. Even at $20/hr and a 3 hr assembly time, you're still only looking at $60 per PC.


It is my opinion that the overall business climate (AKA TAXES and Regulations) is what drives most business overseas.
 
[citation][nom]snowgoer1998[/nom]Example:How long does it take to fully assemble a dell computer??? I don't know but I'd be willing to bet that the ACTUAL assembly time is less than 30 minutes...Figure an assembly line, with specialized workers, doing only ONE task...the amount of time it takes to build a home computer is not long at all for some experienced builders...less than 3 hrs. To say that labor is the reason Dell does not bring it's manufacturing back to the US is just a joke. Even at $20/hr and a 3 hr assembly time, you're still only looking at $60 per PC.

It is my opinion that the overall business climate (AKA TAXES and Regulations) is what drives most business overseas.[/citation]
So who is assembling the HDD, the Blu-ray drive, the monitor?
 
[citation][nom]tayb[/nom]Maybe if people in the USA didn't think they were worth so much more than they are Dell could bring their manufacturing facilities back here and operate them. Too bad that's a pipe dream because workers here would expect to be paid $15+ an hour doing unskilled work in a factory and then they would unionize and drive up costs even further by demanding outrageous benefits for doing their unskilled labor. If Dell leaves they will be heading to India.I would rather have inexpensive Dell products than ones that had "Made in the USA" stitched on the back in tiny letters.[/citation]

Oh hell! I could start between $10-12 assembling computers on a line just like the best of em! Put better materials into your parts, build em better, and you'll have better computers. And, if we did have more localized manufacturing in the US, that would be fewer tariffs to pay, less gas used to transport machines from point A to point B, and you'd also find that you got products to market significantly faster and you could take care of defective product much more easily.

I'm not saying that localization of production works 100% of the time, but there's a lot you can do more easily and effectively when things are vertically integrated.
 
[citation][nom]Acert93[/nom]From a pure fiscal perspective it makes a lot of sense--you can hardly fault CEOs from moving overseas when they are beholden to stock holders to make as much money as possible.That said these sort of business practices are short sighted. While it is commonly stated that moving these jobs overseas raises the standards of living in other countries (often true) some of the major reasons these companies move is to avoid labor laws regarding work hours, safety conditions, and the like. Another is environmental regulations. It would be niave to believe that the outsourcing of American industry has resulted in a cleaner world or better living conditions across the board. I think the picture is quite mixed and very little attention has been paid to the consequences of these actions domestically and abroad.These jobs aren't coming back, but from an American perspective we need to ask what standards are we holding US firms overseas as well as to foreign made products? And what is being done to fill the void for vacated jobs? Does it do general economic health to export jobs and leave a vacuum of unemployed workers? It would be nice if our elected officials spent time working on real issues instead of furthering their own political careers. I don't think there are easy answers to these issues, but the consumer-driven economy will eventually fail. In this regards the recent recession is GOOD. There needs to be market corrections. I know how owners are mad, but their properties were overvalue and the moves to protect banks and home owners only delays the inevitable.[/citation]
But all the money those CEOs and shareholders make will trickle-down to the rest of us right? ;P
 


If you had read everything, I didn't claim it was just salary costs. All of these benefits combined do take a toll. This is what GM and Chrysler is finding out.


 
Has nothing to do with the cost of living. Its our stupid politicians being owned by company's profiting from outsourcing. Try getting them to look into fixing our tariffs. I'm not saying raise it high but tariffs should protect the American worker. Tariffs should be fix to erase most all advantage of corporate America taking advantage of 3rd world labor.

I estimate its been about 20 years that the American tariffs have seen any positive change. Over that much time tariffs may need increased as much at 2 or 3 times.

If stock holders want higher profits let them outsource upper management and return the workers jobs here.
 
[citation][nom]aford10[/nom]I live in the heart of the automotive area, smack dab in michigan. I know how much the average joe was making on the lines. Just a few years ago, when I was looking for different jobs, I found several in the area paying $17 - $25 an hour in different auto/autoparts plants. It's not a dream at all.[/citation]

First off, I did explicitly mentioned non-primary automotive. Second, I lived in a Toledo suburb until last year. Third, look at Flint where 11 of the 13 major factories are closed and houses for the last 5 years have been unable to be sold. The unemployment rate is insane in MI and there are not a host of jobs paying $17-$25/hr.

The fact you believe there is such a wealth of these jobs (there isn't) invalidates your point.

[citation]Your argument is backwards. We don't need to make more $$ to keep up with cost of living. If companies didn't pay so much in salaries, pensions, 401k, bonuses, etc..., the cost of goods/living wouldn't be nearly as high. To see proof of that, just compare cities like NYC, and Toledo, OH. This is why the minimum wage increase only hurts those you mentioned who work flipping burgers, at grocery stores, and gas stations. The companies they work for just increase the price of their goods, and pass the cost on to the customers. I used to work in fast food, also at a grocery store, and can tell you that most who worked there, also shopped there. So the increase in cost of goods, was easily more than the $15-$25 a week increase in pay.[/citation]

Not quite.

Your burger flipper, gas station attendant, and grocery clerk need to live in the areas they work. When inflation increases faster than bottom end wages and, more important, income disparity drives up basic costs (housing, health care, transportation) in these areas it isn't basic goods killing them. It is essential consumerism: You want your cheap labor in your pretty neighborhood but you don't want to pay the people working in your neighborhood enough to live there.

@ Snow: to give a realworld example, take a large consumer appliance that costs between $500-$1200 at retail (model dependent, but the bulk of the product designs are identical and are simply rebadging). This product is made in the US and there is less than 1hr labor in the product for a total compensation of $26 to the operation staff (wages, retirement, medical, etc). The major costs after materials are retail mark up, transportation, marketing, and warranty repairs as there is a 5-10% out of the box failure rate on these products depending on model. This company has moved stuff to both China and Mexico. Wages were lower, but so was quality and productivity. Quality was a big issue for this market as consumer tolerance for large ticket items isn't very high and when fuel costs increased (increase material costs AND delivery costs) they moved a lot back to the US. But this also corresponded to major cuts in compensation.

Every scenario will be different, but in this case labor compensation is a very small portion of the cost of the product. But it is one of the elastic elements, one of the reasons for a new start up shop in a neighboring state where they are able to cut labor compensation by close to $10/unit. The dynamics between consumers, investors, and labor is cut throat. Consumers are very much distanced from the people who make their products--you as an American don't know the working or living conditions of the people you buy products from. The bottom line is almost always cost and value. This isn't a bad thing, but it does have consequences. But don't believe the above concerning $25 floating all around MI for unskilled labor. Anyone with half a brain can see MI is in a bad situation and there is NOT a wealth of openings at car companies. Indeed the news over the last 5 years has been layoffs followed by more layoffs. Some of this has been good and needed correction, some of it self destructive. But there are a lot of MI residents who would love a $25/hr job right now--many with a lot of experience in manufacturing. Those type of jobs are NOT available to satisfy the mass of unemployed in that state (which is one of the worst states in terms of management and long term preperation; they clearly did not plan for shifts in the economy believing American cars would always be a strong market force and able to adapt to globalization. Opps.)
 
lol 15$ an hour for unskilled labor LOL what pipe dream are u living in im an it pro with my A+ NET+ MCSE AND CCNA I only make 20$ an hour u must have it lucky if your makin 15 at a manufacturing job... but try and support a family with anything less than that. you will be in the poverty level
 
I'd say keep the junk with the junk....

Dell should leave Canada and Usa.

Send Toshiba, Acer and Hp too why your at it.....maybe they learn to respect their costumers a bit more.

Send them Bell Canada as well for free
 
why is everyone saying that people would demand 15 or 20 an hour? what about all the teens that have no jobs, because other middle aged ppl are looking for work and cant find any... there is plenty of people who are unskilled and would pick up some skills besides flipping burgers, i think working in a manufacturing company would yield them better tech skills then flipping burgers 😛
 
[citation][nom]drksilenc[/nom]lol 15$ an hour for unskilled labor LOL what pipe dream are u living in im an it pro with my A+ NET+ MCSE AND CCNA I only make 20$ an hour u must have it lucky if your makin 15 at a manufacturing job... but try and support a family with anything less than that. you will be in the poverty level[/citation]

I think you need to market yourself better then sir.
 


You're right, new jobs aren't as prevelent as they once were. That's because the collapsing global economy, ballooning salaries and benefit packages have already pushed most companies elsewhere, if not bankrupted them. That's thanks in part to unions.

Most do like to live in the area they work. Every city has income disparity, they always have. That's why cities normally have a nice side, and a bad side. It's a pretty simple concept, increasing salaries/benefits do drive up consumer costs. The cost of everything is inflated. If we took a step back, they would go back down and come in line with some of the rest of the world, and maybe, just maybe bring some businesses back.
 
[citation][nom]kelemvor4[/nom]Wouldn't it be great if you could buy PC's manufactured in the US again? More likely, Dell would go to Japan or Taiwan or the Philippines though, rather than doing the right thing.[/citation]
you really are f**ken ignorant, you are saying building computers in the US is the right thing, yeah i dont think that will EVER happen again the economy is so f**ked in the US its not advisable to make lollies in the US
 
Honestly? Anyone could start a company that uses parts assembled from known quality vendors, then assemble the parts into a PC and mark it up a little and STILL sell them for cheaper than Dell does.

Think about it, Dell = proprietary parts made & assembled in China which leave little or no room for upgrading and the quality of the items are ok

Cyberpower PC = known good quality parts (for the most part) that are made in other countries but assembled in USA and price/performance wise, Cyberpower PC is better, not to mention they don't bundle a bunch of software that you don't need.

do the math...
 


I work in a rather small bank. Those certifications would bring a starting pay of ~55k-60k per year, even more if you were skilled in citrix. You may want to look around a little more.

Though, I think people missing a key point. Because of the global collapse, those high paying entry jobs aren't there anymore. There's a hiring freeze all over. That is what the entry pay used to be. Now we are seeing the results of that. That's the big reason for the buy outs of employees. They want to purge those who are already making the higher wages and nice benefit packages, and replace them with new, lower paid employees.
 
[citation][nom]elbert[/nom]Has nothing to do with the cost of living. Its our stupid politicians being owned by company's profiting from outsourcing. Try getting them to look into fixing our tariffs. I'm not saying raise it high but tariffs should protect the American worker. Tariffs should be fix to erase most all advantage of corporate America taking advantage of 3rd world labor.I estimate its been about 20 years that the American tariffs have seen any positive change. Over that much time tariffs may need increased as much at 2 or 3 times. If stock holders want higher profits let them outsource upper management and return the workers jobs here.[/citation]

The collapse you are seeing now is a direct result of those same protectionist measures. It's better to adjust with the market than to price yourself out of it.
 
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