Kelvin
07-01-2007, 09:17 PM
A few thoughts on this company's production being based in China:
I have been advised recently (from someone who was working is Asia) that there is another side to outsourcing to developing nations.
Most 'western' societies have very strict OH&S (Occupational Health and Safety) standards, and employers are expected to provide a safe working environment for all employees (including sub-contractors). Breaches cost companies dearly, both in bad publicity and financially - heavy fines are imposed for breaches, especially if someone is injured or killed in the workplace.
Likewise, companies that produce waste are expected to dispose of it in an approved manner, and this area is tightly regulated. Breaches can be very costly, since here too heavy fines are imposed for breaches, and the publicity can be particularly damaging. Anything that is even slightly toxic must be handled, stored and disposed of in a manner that is set down in the law. For example, spray painting booths must not allow any 'significant' solvent or particulate matter to escape, and there are very strict regulations that dictate exactly how the solvents and particles shall be filtered, and any waste disposed of.
Naturally, we also have minimum wage standards, compulsory superannuation contributions for employees (only so the government won't have to pay pensions in our latter years, but that's another story), etc. These are all burdens on local industry, but they are necessary to ensure a reasonable living standard, and to prevent screwing up the planet any more than is deemed necessary at the time.
Many of the 'cheap labour' countries do not have any of these schemes in place. OH&S is up to the individual - basically "you get hurt and can't work, you don't get paid". Superannuation? You must be kidding. Waste disposal? The recent massive toxic waste spill(s) in China tell us what we need to know about that. In short, all the things we take for granted are missing. The workers are paid a pittance by our standards, but to them, it's very good money. Why would the employers make life any harder for themselves by employing best practices for OH&S, superannuation or environmentally friendly waste disposal?
Let's face facts here - most of the western corporations would quite happily dispense with these 'unwarranted exploits of their profitability' if they possibly could. Our governments have imposed these things upon them, very few are voluntary. Wages and conditions have been fought for over a long period by unions, and although it must be admitted that some union claims are outrageous, many of the benefits we now enjoy were the result of prolonged battles between unions and employers. No employer wants to pay any more than absolutely necessary, and every government or union demand is seen as a threat.
Since our scumbag government recently castrated our labour laws, we have seen a rash of unscrupulous employers 'offering' current employees their own jobs at a reduced wage - or risk the jobs going offshore. This is simply blackmail, and we have lost a significant number of manufacturing jobs recently to cheaper overseas alternatives. Unions in general have nipped such tactics in the bud in the past, but it is getting harder for employees to negotiate a fair deal - and this with the government's assistance!
This is not to say that all union claims (or their own blackmail tactics) ultimately benefit the workers - far from it. Nor are all government impositions well thought out - think of the European Union's 'ROHS' directive (restriction of hazardous substances), and the lead-free solder debacle!
Ultimately (and this is really the whole point), when a critical mass of jobs has gone overseas, the original countries (Oz, US, UK, Europe, etc.), will also lack the critical mass of purchasers. At around that time, the economy simply implodes.
I know the above is a bit of an over-simplification, but the net result is that economies will implode, and it will happen sooner rather than later if governments don't act. The signs are already present ... record numbers of bankruptcies, huge debt per head of population, more and more jobs disappearing overseas, and even migrant workers brought in to 'solve' the skills shortage. Why do we have a skills shortage? Might it be that people can see the writing on the wall for manufacturing anyway? Perhaps because the government has done nothing whatsoever to encourage apprentice employment? Maybe the consumer society in which we live considers 'manual labour' to be beneath us? All of the above.
To an extent, we might say that the (major) retailers are true villains in this, but we are also to blame (we believe their advertising drivel, after all). Promote the consumer society, push the latest 'must have' models, squeeze the local manufacturers until they are no longer capable of bleeding, and sell, sell, sell (at all costs). Buyers must be convinced that the CD player or TV they bought last year is so passé that it must be replaced at once, lest they be seen as 'last week' types.
The time will come when the buyers become sufficiently scarce, and the competition for the lowest price sufficiently fierce - regardless of how insanely low it might be - then the retailers will implode too (it has happened to several here already). As soon as people feel scared for their job security (what job security??), they slow down their spending. All we need is the critical mass ...
Just some ramblings....
I have been advised recently (from someone who was working is Asia) that there is another side to outsourcing to developing nations.
Most 'western' societies have very strict OH&S (Occupational Health and Safety) standards, and employers are expected to provide a safe working environment for all employees (including sub-contractors). Breaches cost companies dearly, both in bad publicity and financially - heavy fines are imposed for breaches, especially if someone is injured or killed in the workplace.
Likewise, companies that produce waste are expected to dispose of it in an approved manner, and this area is tightly regulated. Breaches can be very costly, since here too heavy fines are imposed for breaches, and the publicity can be particularly damaging. Anything that is even slightly toxic must be handled, stored and disposed of in a manner that is set down in the law. For example, spray painting booths must not allow any 'significant' solvent or particulate matter to escape, and there are very strict regulations that dictate exactly how the solvents and particles shall be filtered, and any waste disposed of.
Naturally, we also have minimum wage standards, compulsory superannuation contributions for employees (only so the government won't have to pay pensions in our latter years, but that's another story), etc. These are all burdens on local industry, but they are necessary to ensure a reasonable living standard, and to prevent screwing up the planet any more than is deemed necessary at the time.
Many of the 'cheap labour' countries do not have any of these schemes in place. OH&S is up to the individual - basically "you get hurt and can't work, you don't get paid". Superannuation? You must be kidding. Waste disposal? The recent massive toxic waste spill(s) in China tell us what we need to know about that. In short, all the things we take for granted are missing. The workers are paid a pittance by our standards, but to them, it's very good money. Why would the employers make life any harder for themselves by employing best practices for OH&S, superannuation or environmentally friendly waste disposal?
Let's face facts here - most of the western corporations would quite happily dispense with these 'unwarranted exploits of their profitability' if they possibly could. Our governments have imposed these things upon them, very few are voluntary. Wages and conditions have been fought for over a long period by unions, and although it must be admitted that some union claims are outrageous, many of the benefits we now enjoy were the result of prolonged battles between unions and employers. No employer wants to pay any more than absolutely necessary, and every government or union demand is seen as a threat.
Since our scumbag government recently castrated our labour laws, we have seen a rash of unscrupulous employers 'offering' current employees their own jobs at a reduced wage - or risk the jobs going offshore. This is simply blackmail, and we have lost a significant number of manufacturing jobs recently to cheaper overseas alternatives. Unions in general have nipped such tactics in the bud in the past, but it is getting harder for employees to negotiate a fair deal - and this with the government's assistance!
This is not to say that all union claims (or their own blackmail tactics) ultimately benefit the workers - far from it. Nor are all government impositions well thought out - think of the European Union's 'ROHS' directive (restriction of hazardous substances), and the lead-free solder debacle!
Ultimately (and this is really the whole point), when a critical mass of jobs has gone overseas, the original countries (Oz, US, UK, Europe, etc.), will also lack the critical mass of purchasers. At around that time, the economy simply implodes.
I know the above is a bit of an over-simplification, but the net result is that economies will implode, and it will happen sooner rather than later if governments don't act. The signs are already present ... record numbers of bankruptcies, huge debt per head of population, more and more jobs disappearing overseas, and even migrant workers brought in to 'solve' the skills shortage. Why do we have a skills shortage? Might it be that people can see the writing on the wall for manufacturing anyway? Perhaps because the government has done nothing whatsoever to encourage apprentice employment? Maybe the consumer society in which we live considers 'manual labour' to be beneath us? All of the above.
To an extent, we might say that the (major) retailers are true villains in this, but we are also to blame (we believe their advertising drivel, after all). Promote the consumer society, push the latest 'must have' models, squeeze the local manufacturers until they are no longer capable of bleeding, and sell, sell, sell (at all costs). Buyers must be convinced that the CD player or TV they bought last year is so passé that it must be replaced at once, lest they be seen as 'last week' types.
The time will come when the buyers become sufficiently scarce, and the competition for the lowest price sufficiently fierce - regardless of how insanely low it might be - then the retailers will implode too (it has happened to several here already). As soon as people feel scared for their job security (what job security??), they slow down their spending. All we need is the critical mass ...
Just some ramblings....