Manufacturing is very labor intensive which is why countries with low labor costs (e.g., China) have come to dominate global manufacturing. But what will happen as machines displace more and more humans? The cost of human labor will shrink as a proportion of the total cost of manufacturing.
At a sister factory here in the Dutch countryside, 128 robot arms do the same work with yoga-like flexibility. Video cameras guide them through feats well beyond the capability of the most dexterous human.
One robot arm endlessly forms three perfect bends in two connector wires and slips them into holes almost too small for the eye to see. The arms work so fast that they must be enclosed in glass cages to prevent the people supervising them from being injured. And they do it all without a coffee break -- three shifts a day, 365 days a year.
All told, the factory here has several dozen workers per shift, about a tenth as many as the plant in the Chinese city of Zhuhai.
This is the future. A new wave of robots, far more adept than those now commonly used by automakers and other heavy manufacturers, are replacing workers around the world in both manufacturing and distribution. Factories like the one here in the Netherlands are a striking counterpoint to those used by Apple and other consumer electronics giants, which employ hundreds of thousands of low-skilled workers.
Those millions of low-skilled jobs will be eliminated very rapidly, and China will quickly lose its manufacturing advantage.
Foxconn has not disclosed how many workers will be displaced or when. But its chairman, Terry Gou, has publicly endorsed a growing use of robots. Speaking of his more than one million employees worldwide, he said in January, according to the official Xinhua news agency: "As human beings are also animals, to manage one million animals gives me a headache."
The cost to manufacture with robots will not be significantly cheaper in China than in the United States, and America's relative stability and lack of corruption will make it very tempting to build more here. This will lead to massive unemployment and social unrest in China, which the country may not survive.