James Pethokoukis writes: “A Robot Revolution, This Time in China” by New York Times reporter Keith Bradsher pretty much gives a modern economic lesson every sentence. It also presents a picture of a modernizing China that was completely missing from the 2016 presidential campaign. From the piece:
Robots are critical to China’s economic ambitions, as Chinese companies look to move up the manufacturing chain. The Ford assembly plant is across the street from a robot-producing factory owned by Kuka, the big German manufacturer of industrial robots that a Chinese company bought last summer. For carmakers, the reliance on robots is driven partly by cost. Blue-collar wages have soared because multinational companies have moved much of their production to China even as its labor force is rapidly changing. The combination of the one-child policy, which cut the birth rate through the 1980s and ’90s, and an eightfold increase in college enrollments has cut by more than half the number of people entering the work force each year who have less than a high school degree and may be willing to consider factory work. Blue-collar wages are now $4 to $6 an hour in large, prosperous cities, though still far lower than in the United States.
It’s all there: globalization, automation, demographics. And guess what, no sign of an automation backlash because it’s clear the country needs more robots, not fewer. Chinese workers must become more productive. Ruchir Sharma in the Washington Post late last year:
In many industrial countries, from Germany to Japan to South Korea, growth in the working-age population has already peaked, acting as a drag on the economy … (read more)