The View from Abroad
Low-Cost Caribbean Assembly: Trinidad and Tobago. Factory space immediately available. Advantages include: 45t hr. wages; dexterous, English-speaking workers; high literacy rate; daily air cargo...
...Essentially, these regulations give electronics firms the best of both worlds: they can avoid high wages at home by shipping out the labor-intensive parts of their work, and they can avoid high tariffs when they return by making use of 806.30 and 807.00...
...Indonesia and Thailand offer perhaps the lowest wages in the world, but they are further from the United States than Mexico and other Latin American countries whose proximity means lower transportation costs and easier communications between parent and offshore plant...
...30 Wages: "We Girls Are Cheaper Than Machines" Far Eastern wages tend to be the lowest on record, at least for regions with a sufficient industrial infrastructure to permit manufacturing...
...See Table 11-1] In other words, during the same time that factory sales of electronics in the United States almost doubled (from S20.9 billion in 1966 to S36.4 billion in 1975), offshore production increased ten times...
...Component producers in particular have been quick to make use of 806/807 provisions...
...In sum, as one manufacturer said, "The industry would be in a hell of a pickle if they said to cut [806/807] off today...
...Instrum...
...TABLE II-3 AVERAGE HOURLY WAGE, ASIA (Unskilled Workers, US S, 1976) COUNTRY HOURLY WAGE ELECTRONICS START-UP Indonesia 174 1972 (Monsanto) Thailand 264 NA Philippines 324 NA India 374 1974 (Intersil) Taiwan 37t 1964 IGen...
...There was no question of "declining" the overtime work...
...CTS, a components producer, reported equal productivity rates at its Illinois plant and its Taiwan facility...
...Manufacturers tend to operate larger facilities in Asia-up to 200,000 square feet-and to invest more money in them than in their facilities in Mexico...
...The work usually requires some visual aid, either a microscope or a high-powered magnifying lens...
...businessman in Singapore 4 2 Somebody, clearly, has the best interests of business in mind...
...With a typically complex circuit, workers are expected to produce between 60 and 100 assemblies an hour...
...1975: House of Representatives, Commit- tee on Ways and Means, Subcommittee on Trade, Back- ground Information and Compilation of Materials on tems 807.00 and 806.30, Tables 2 and 5. U.S...
...The "brain" inhabits the laboratories which circle Boston or the Silicon Valley in California...
...Total time elapsed: 75 seconds...
...But even if productivity were lower in the offshore plants, the enormous wage differential makes up the difference...
...If it is good, an "approved" light goes on, if not, a "reject" light appears...
...Thus, these tariff provisions have been seized upon by all runaway industries, especially textiles, apparel and, of course, electronics...
...that a large part of electronics production was being shifted abroad...
...When plants are established offshore, wages start out at rock-bottom levels and then tend to increase gradually...
...21 In the words of David Packard of Hewlett-Packard who moved his firm's assembly work to Singapore and Malaysia: "Americans [were] just not temperamentally suited to the intensive assembly work required in stringing core memories...
...The Far East was seen as the area of lowest technology, an area for assembly work alone...
...We have already seen how the technical division of labor separates the conceivers-engineers, scientists and managers-from production workers...
...The Bank of America estimated that approximately 120,000 immigrant workers from Malaysia and Indonesia were living in Singapore on temporary work permits in 1974...
...0 Several points about the firms are important to note...
...Skills include core-stringing, coil winding and assembly of micro-electronic relays, cable harnesses and computer sockets...
...While it is still true that capital-intensive production will generally remain in the United States and labor-intensive production abroad, nevertheless firms are beginning to ship expensive machinery to the Far East and Latin America...
...2 5 Finally, it is also clear that the turn-over rate among women is much higher than the rate among men since women workers often leave their jobs upon marrying (at least in the Far Eastern plants...
...manufactured components...
...According to Nat Snyderman, Electronic News' specialist on trends in offshore production, "The rate of shipments, the installation of automatic equipment and the heavy plant expenditures have put to rest all but a few lingering expectations that assembly operations will be returned to the United States in the foreseeable future, barring major political upheavals...
...49 At one electronics firm in Nogales, Mexico, there was a 100% turnover in one eight-month period...
...55 For Job Security, Stay Away from Electronics This points to the fact that more U.S...
...For example, Hong Kong officially observes only two of the 28 ordinances recommended by the International Labor Organization: workers compensation for industrial17 accidents and a 48-hour work week for women (exclusive of overtime...
...While the cost of living is lower in, say, Thailand than in the United States or Latin America, the minimum wage in most Far Eastern countries comes nowhere near covering basic expenses, regardless of how low these may be...
...By examining industry reports, annual company reports and 10K forms, industrial directories, congressional hearings and other sources, NACLA was able to compile a list of U.S...
...16 The separation of conception from execution provides the basis for a tremendous leap in worker productivity under the capitalist system as workers no longer have to think about a task, they just perform it...
...This represents more than a ten-fold increase since 1966...
...Mexico, which produced heavier, more complex equipment, was often described as a "step between high technology assembly in the United States and less high in Korea...
...Finally, electronics workers filed more "Worker Adjustment Assistance Petitions" with the U.S...
...Precise information on the offshore producers is hard to come by...
...Nevertheless, according to most sources and our own research, the number of firms engaging in offshore production of one type or another seems to be very high, encompassing most producers of components and consumer electronics goods, fewer industrial producers (except insofar as they use components assembled abroad), and very few producers for the government market (who most often use components assembled in the United States...
...electronics runaways...
...Poor conditions and low pay contribute to an exceptionally high labor turnover rate in electronics as well as in other labor-intensive assembly work...
...electronics firm to enter Taiwan in 19648...
...See Table II-31 The figures given in Tablell-3 are average wage figures...
...Assembly Work: Tedium and Dehumanization Assembly work in both U.S...
...In Labor and Monopoly Capital, Harry Braverman described "the separation of hand and brain [as] the most decisive single step in the division of labor taken by the capitalist mode of production...
...electronics firms abroad during a good year for the industry...
...Hence [the firm's] expansion to Malaysia...
...Harsh repression is the standard response to worker militance in most countries that runaways now call home...
...Electronic engineers interviewed were quick to point out that the work of testing was "too complex" for workers in offshore plants...
...Semi...
...After a year some of the companies gave a bonus, but most of the girls didn't last that long, and those that did had to get glasses to help their failing eyes...
...Increasingly it appears that offshore producers are not planning to return to the United States...
...U.S...
...In Taiwan, strikes have been outlawed since the Labor Disputes Act of 1943 and the State of Seige declaration of 1949,45 In South Korea, the Philippines and Thailand, strikes are also banned and they are stringently controlled in Singapore...
...The work process, in this way, is broken down into hundreds of simple, homogeneous tasks, each of which a worker repeats time and again...
...ELECTRONICS RUNAWAYS BY REGION (Number of Plants) t LATIN AMERICA ASIA EUROPE Mexico 193 Hong Kong 45 Spain 29 Puerto Rico 140 Taiwan 45 Ireland 22 Jamaica 9 India 32 Scotland 18 Barbados 5 Singapore 30 Portugal 14 El Salvador 5 Malaysia 23 Malta 1 Dom...
...Assembly of tiny silicon circuit chips to a larger "package" is another job most often exported to offshore facilities...
...As the receiver begins to move on she hurriedly crimps one final resistor to the remaining wire...
...Items 806.30 and 807.00 imports from Brazil, for example, grew from S2.8 million in 1971 to S73.6 million in 1975...
...firms...
...Offshore facilities have only a three-to-five year useful labor advantage...
...production since assembly work is done abroad...
...Malaysia 41t 1972 Natl...
...2 Only includes lower wage, "gateway" areas...
...None of the U.S...
...No further processing need be done upon return to th United States...
...One minute per series of tasks was thought to be optimal.' 8 In that fashion workers "are required to memorize fewer work steps" and therefore will be able to produce more...
...5 1 During the 1969-71 recession the industry did lay off more foreign workers than U.S...
...electronics industry (such as those that occurred in 1969-71 and 1974-75) can produce the wholesale dismissal of up to half the labor force almost overnight...
...These tasks are repeated hour after hour, day after day...
...When 806.30 and 807.00 began to be widely used in the mid-sixties, much production was centered in Europe and a few Asian nations-Hong Kong, Taiwan and South Korea...
...The numbers can often be misleading given how susceptible the industry is to recessions...
...2 Testing, in particular, is most often carried out in the United States...
...Rapidly she picks up two twisted wires and attaches them to a power transformer, then three additional wires, all color coded, are joined to a series of leads...
...An incredibly complex pattern of circuitry has already been engraved on the chip before it reaches the offshore plant...
...One of the clearest examples of this is General Instrument, a New York-based firm that produces everything from TV tuners to micro-circuit assemblies...
...4 Philippines 17 Curacao 3 Thailand 8 Haiti 3 Indonesia 6 Bermuda 2 Okinawa 1 Virgin Is...
...In the time that it took14 you to read this paragraph she would have been well on her way to finishing the set of tasks...
...offshore plants tend to increase automatically with the length of time worked...
...For example, the table lists Korea's average hourly wage at 521...
...offshore electronics plants in Indonesia are unionized...
...Source: Business Asia, April 30, 1976.16 This is particularly true since productivity abroad seems at least comparable to U.S...
...17 Such a process essentially reduces the worker to a mere appendage of a machine, providing a further basis for his or her dehumanization...
...It went there to increase its profits and to become more competitive...
...And finally we will analyze in depth the offshore labor force: what workers do, what they earn and what conditions they work under...
...Given the weakness or non-existence of unions and the banning of strikes, it is hardly surprising that employers take advantage of their workers in numerous ways...
...Tariff Schedule known as Items 806.30 and 807.00.* *Item 806.30 covers any metal product whose form may be changed abroad as long as it is returned to the United States for further processing...
...As we have seen, this holds true in Taiwan, Hong Kong and El Salvador every bit as much as it does in New York, Massachusetts and North Carolina...
...In fact, virtually all electronics firms have developed some connection with 806/807...
...Pay scales vary as do conditions, but both sets of workers face employers who have the same answer for every challenge: "if you fight for higher wages, shorter hours or better conditions, we'll move...
...And, given a certain amount of invested capital, wage increases will be tolerated, at least until they reach a certain point.* Another factor of prime importance is that unemployment in many Far Eastern countries has tended to decrease, sometimes dramatically...
...In the last section we questioned whether or not offshore producers were, in fact, helping foreign workers by providing sources of employment at what is often (somewhat) higher than local wages...
...In many places, workers, overcoming severe obstacles, have fought for higher pay and better conditions...
...3 5 RUNAWAYS SLEEP WITH THEIR SHOES ON The essential point to understand about offshore producers, as we have stressed, is that their profit structure depends on getting the most work for the least pay...
...As of 1976, they ranged from a low of 17e per hour in Indonesia to a high...
...Since then, Malaysia, Singapore, the Philippines, Mexico and Brazil have become big producers...
...The dominant roles males play in the Korean society as a whole has implications for leadership positions in business," they argue...
...On the one hand, foreign governments are trying to expand their own labor force by bringing in more women...
...Here we will demonstrate how the needs of offshore producers and foreign workers ultimately are in contradiction...
...electronics firms with the opportunity to enter European markets and save on wage costs at the same time...
...The difference spells profits for the companies and, as we have seen, unemployment for U.S...
...The Korean Office of Labor Affairs reported that the monthly minimum wage (which they listed as S93 and which we found to be S49.98 for a U.S...
...The hardest hit sectors of the electronics industry are in the fields of radio and television production...
...electronics products of all types and varieties...
...Tariff Commission between 1962-1974 than any other group of workers, with the exception of those in the shoe industry...
...Thus, firms with production units in those countries most often move there to get inside tariff barriers, rather than to pay lower wages...
...Here, it is clear to all that the labor force is heavily dominated by women workers because they are paid so much less than male workers...
...In one Hong Kong factory, for example, the owner locked the doors of his plant at closing time during those days when he wanted the workers to work overtime...
...43 Similar conditions pertain in Latin America...
...In fact, the starting wage at Control Data's Korean plant (as of 1976), which included a quarterly tenure bonus, was approximately 27e an hour...
...Singapore, for example, drew up plans to bring 75,000 more women into the manufacturing labor market...
...demand increased too rapidly to be met by domestic supply...
...We have already described some of these in U.S...
...workers while maintaining full-staffed foreign operations...
...25 This is significant since wages at most U.S...
...Two of labor's most important weapons-the right to organize and the right to strike-are either outlawed or constantly challenged by dictatorial regimes from Taiwan to Haiti...
...34 And Imec, a division of the Republic Corporation with numerous assembly operations in Mexico, reported productivity of its Mexican workers at 10-15% higher than in the United States...
...At Control Data's Korean plant, corporate officials argue that "tradition" prevents placing women in any positions of responsibility...
...In Singapore, turnover in the labor-intensive industries varied between 8 and 10% monthly...
...Mexican unions, while stronger than many, are part of the government bureaucracy and unions are severely controlled in Haiti, the Dominican Republic and El Salvador...
...Another common task in offshore facilities is the assembly of printed circuit boards...
...1 And the low-wage European countries were described as "full-fledged production plants" complete with their own testing equipment, producing for European, not U.S., markets.12 Finally, it is quite evident that firms have more than one offshore facility in any region, particularly in the Far East...
...The Foreign Work Force The manufacturers rationalize the export of these jobs by alleging that they are unable to "find enough workers willing to do the tedious assembly work required," and therefore must turn to offshore workers possessing "good dexterity and eyesight and the right kind of mental attitudes...
...jobs in electronics are threatened with export and that, furthermore, it is unlikely that this outflow of jobs will be stemmed...
...offshore electronics firm) was far below the S142 a month which the Economic Planning Board said was needed for an average family...
...counterparts...
...This represented 12% of the entire work force...
...Item 807.00, passed in 1963, reduces duties on any product whose parts originate in the United States and which is sent abroad for assembly...
...Regardless of any shipment of heavy equipment abroad, our answer would have to be "no...
...Once here, the work involves attaching a variety of miniscule wire leads to their proper connection in the larger component...
...A slump in the U.S...
...3 This same trend can be observed in Table II-3 and is corroborated by other industry sources...
...Television receiver assembly work is a good example of this...
...Electronics workers face certain hazards due to the nature of the materials with which they work...
...A second capactitor is crimped to another wire...
...When wages got too high in one country-as we will demonstrate below-the firm would pack off to another...
...If its wages reach too high a level in Thailand, it will move to Malaysia without a moments thought of the workers...
...In the fabrication of a computer's core memory system, for example, the cores are fabricated and tested in the United States, where the printed circuit boards are also manufactured...
...AND ABROAD GENERAL INSTRUMENT AND ITS JERROLD'S SUBSIDIARY Source: NACLA Register and Hewlett-Packard) had established plants in Scotland...
...In electronics, this division is reaching its extreme as a geographic division as well...
...39 If no solution can be found for maintaining a high level of unemployment while expanding the work force, however, the companies will move on to greener pastures...
...offshore plants should be compared to U.S...
...productivity levels (defined as output per worker-hour...
...Duty is paid only on the value added...
...On the other hand, some governments are attempting to augment their own labor force by attracting immigrants from neighboring countries...
...40 As another executive explained, "At about 601 an hour [wages in electronics] it is uneconomic to use offshore facilities because of other costs involved...
...6 Nevertheless, the list13 (which is summarized in Table 11-2) can provide a general picture of where the jobs are abroad...
...Production by U.S...
...See Table II-4] For each worker General Instrument employs at its Jerrolds subsidiary in Chicopee, Massachusetts, it can employ 3.8 workers in Mexico and 14.5 workers in Taiwan...
...In fact, the production of most offshore producers falls somewhere between the two...
...But more and more of the "hands" are thousands of miles across the ocean, in Taiwan and India, Haiti and El Salvador...
...One woman described the plight of a relative who had worked at an electronics assembly facility in Tijuana: Her job was to wind copper wire onto a spindle by hand...
...2 On the other hand, as we will discuss below, there are certain indications that the industry will respond to future crises by laying off U.S...
...Employers put forth the argument that the cost of living in these countries is so low that a worker can easily get by on such a wage and furthermore that their wages are consistently higher than those paid by local companies...
...The numerous devices they produce are quite well suited to offshore production because 1) they require a tremendous amount of unskilled hand assembly work, 2) they have a predictable sales volume, 3) their production process is relatively standardized, and finally, 4) they are very light weight and therefore cheap to transport...
...The larger firms all maintain offshore plants and import under these tariff laws, while many of the smaller firms subcontract their assembly work to independent shops abroad or even to the larger U.S...
...An assembled circuit board is placed in a machine and a proper program selected...
...It operates one of the largest cable TV producers (Jerrolds Electronics), assembles numerous types of business machines and provides computer services and outlets for TABLE 11-2 U.S...
...In addition, most Far Eastern countries have banned strikes...
...The workers begin with a tiny piece of silicon or germanium, often no larger than a millimeter square...
...They can be simple affairs onto which five to ten components are attached, or highly complex masses of more than 400 separate components, each of which must be placed in the proper hole and soldered to the proper wires...
...Although it is difficult to collect data on the wages of specific companies, the example of General Instrument (and its Jerrolds subsidiary) can give us an indication of the disparity between the daily U.S...
...Trade unions are virtually non-existent in Hong Kong, Malaysia, and they have been banned in Thailand since the October 6, 1976 coup...
...wages, not other foreign wages, since the issue under question is how the runaways make profits...
...Of 715 women workers at Control Data's Korean facility, only 9 remained after marriage, whereas 70% of the men remained...
...This Item was passed in its essential form in 1930 to originally allow for production abroad, largely in Canada, at a time when Hugnes electronic plant in Mexicali, Mexico...
...Currently, the most common articles to make use of 806.30 include aircraft parts, certain iron and steel mill products (primarily bars, plate, wire), semiconductors and electronic parts...
...47 This same situation exists in Mexican assembly plants...
...The cores and circuit boards are then assembled in the Far East or Mexico...
...It is clear TABLE 11-1 VALUE OF ELECTRONICS PRODUCTS IMPORTED INTO THE UNITED STATES UNDER ITEMS 806.30 and 807.00, 1966 AND 1975 (Thousands of U.S...
...daily air cargo to U.S.A...
...factories and offshore plants is broken down into a series of repetitive operations notable only for their deadening and dehumanizing aspects...
...lower starting wages are standard in electronics production in almost every country...
...Source: Compiled by NACLA *The charts are available from NACLA-East, PO Box 57, Cathedral Station, New York, NY 10025...
...wage level and that paid by U.S...
...of 62e per hour in Singapore, according to one survey...
...Finally, most are tested back in the United States where the cabinet is constructed and the entire unit tested...
...3 It is also important to stress that wages paid to workers employed in U.S...
...Seventy percent of all imports of electronics components entered the United States under Items 806.30 and 807.00 in 1975.2 Electronics products alone accounted for nearly 15% of all goods which entered the United States under 806/807.3 As of 1975 the major branches of electronics production imported over S1.2 billion worth of goods into the United States under Items 806.30 and 807.00...
...Unions are particularly weak in the Far Eastern countries...
...This "deskilling of the operator"-in the words of an electronics industry journal-assures that production will not depend on any worker with a given skill level...
...A study of the top 100 electronics firms with at least one offshore plant demonstrated that most semi- conductor firms have facilities in at least two countries...
...Without the quarterly bonus, the pay was roughly 16e an hour...
...It is this similarity of interests-that of workers everywhere confronted by the same employers acting on the same need to expand profits-which provides the framework for a common strategy for workers at home and abroad, a strategy which directly challenges a chauvinist response characteristic of the trade union bureaucracy...
...workers, although this may have been largely because producers were left with huge inventories of semiconductor devices in relation to new orders...
...Advertisement, Electronic News' In this section we will look at production abroad in general: what is produced and where, and what changes have taken place in offshore production in the last ten years...
...In this section we will focus on the foreign work force, the laborers who each year assemble by hand more than five billion components which go into U.S...
...Workers throughout the Far East and the Caribbean face numerous obstacles in their struggle to achieve a living wage and decent working conditions...
...Circuit boards are thin sheets of metal with holes punched in them and a road-map pattern of circuits etched on their surface...
...Thus, when 3,700 workers walked out of National Semiconductor's Thailand plant, or when 1,500 workers struck Texas Instruments' Curacao semiconductor facility, they did so knowing, as do workers at countless U.S...
...To date, runaways have had a severe effect on employment in electronics in the United States...
...In the end, profits will determine the effects of the runaways upon both the Thai workers and the U.S...
...In Singapore, women workers on the average make less than half of what men make for similar operations.24 Furthermore, women workers never quite make it into positions of higher authority and pay in the factory...
...workers could produce as much as 400 workers in his Mexican plant, but that the 400 Mexican workers "are still cheaper than 250 U.S...
...28 Since these do not represent all offshore producers, we could estimate that at least 500,000 workers are employed by U.S...
...Again, duty is paid only on the value added...
...When industry purchases of semiconductor devices declined in 1974, electronic assembly plants in Mexico responded by firing 20,000 workers in one five-month period...
...38 The governments in offshore host countries have attempted to solve this problem for the offshore producers by increasing the size of the available labor pool...
...National Semiconductor became the first electronics producer to move to Singapore in 1968 and Malaysia in 1972...
...13 The reason most often given for this is the fear of being too dependent on any one country for components...
...Semi...
...5 2 At the same time the industry journal reported that National Semiconductor has been spending about S300,000 a day for six weeks on capital equipment for its facilities in Malaysia, Bangkok and Jakarta, and that Texas Instruments had been shipping "impressive numbers" of automated machinery to its facilities in Taiwan and San Salvador...
...4 But the importance of offshore production doesn't answer the question of where a company will choose to locate...
...In other words, we learn very little by asking, "If National Semiconductor didn't go to Thailand, wouldn't the Thai workers be worse off...
...37 Except for Taiwan, those countries with an earlier electronics start-up date have a higher average wage than those with a later start-up date...
...firms abroad...
...And Malaysia's went from S.6 million to S167 million in the same period...
...It was very small and there couldn't be any overlap, so she would get these terrible headaches...
...The first Mexican assembly firm started up in 1961.1 General Instrument became the first U.S...
...The vast majority of foreign assemblers face the same problems and must deal with the same situation as their U.S...
...Approximately 85% of workers in Mexican assembly plants are women between 17 and 23 years old.23 The issue of keen eyesight and nimble fingers tends to fade into the background when the matter of wages arises...
...53 Similarly, Analog Devices was planning the firm's largest single capital investment in Limerick, Ireland" and General Instrument was pushing ahead with a one-million dollar expansion of its Glenrothes, Scotland, microcircuit assembly facility...
...Since women generally are not covered in these countries by existing minimum wage laws, such a move would only further cut already low wage levels...
...round-trip air only S230.00 and generous Government incentives to establish your own plant...
...Calculated as average between monthly high and low wage rates for standard 46 hour week...
...and Intersil opened India to U.S...
...The most serious and persistent problem faced by electronics assembly workers is that of eyesight deterioration...
...Write or call: T.T...
...An executive of Illumination Industries noted that offshore wage rates typically start at 8-100 an hour after which they "usually double the first year, then increase by approximately 50% a year...
...Through our analysis of runaways and the electronics industry, we will present the weaknesses of a protectionist strategy and discuss a number of other alternatives which are open to the working class...
...Singapore, for example, has been integrating more than 25,000 workers a year into its manufacturing work force since 1970 and still faces a labor shortage, particularly for its lowest paying jobs...
...22 Just as in the United States, the hands that do the work usually belong to women, young women, who are said to possess even "keener eyesight" and "more nimble fingers" than their male counterparts...
...manufacturers at their offshore sites, or at least those who might know are not saying...
...On the other hand, it can't be thought of as imports either, since the products come from U.S.-owned plants which are putting together U.S...
...Electronic Development Corporation...
...On the other hand, Scotland and the Republic of Ireland provide U.S...
...plants, that the boss could pack his bags and hightail it out to the next low-cost labor area while the workers would be left jobless...
...Credit: Gil Trevino-Ortiz12 These regulations, which require that producers use parts made in the United States, assess duty only on the value added to the product abroad...
...Thus, it is not unusual to find firms moving in and out of Mexico every six months, whereas Asian firms tend to stay put for 4-6 years...
...1 9 All these tasks are typically part of a larger whole, parts of which have been separated for offshore production...
...Can foreign workers, then, be content in the knowledge that more jobs, and hence, more pay, will be coming their way...
...50 WILL THE RUNAWAYS RUN BACK HOME...
...S. Korea 524 1967 Hong Kong 554 1965 Singapore 624 1968 (Natl...
...This is a complicated question, for no one country satisfies every corporate dream...
...Many of the large TV manufacturers maintain offshore production facilities in which receivers are assembled on a quickly moving production line...
...With each recession in the semiconductor industry, a number of analysts predict that, at long last, the offshore producers will again return home...
...At one position in the assembly line a worker is engaged in a series of crimping operations...
...firms including the largest (IBM, Burroughs, National Cash TABLE II-4 DAILY WAGE: U.S...
...We will examine who has gone abroad...
...Management experts have estimated that, for most production work, no series of tasks should take longer than four minutes...
...The point is that National Semiconductor-or any other electronics runaway-did not go to Thailand to "help" the Thai workers...
...One production manager told NACLA that 250 U.S...
...56 The IUE reports losing 2,000 members in New England alone in the last few years and noted that over 20% of the workers they represent were unemployed in January 1975.57 Furthermore, electronics workers put in only half the overtime they did a decade ago...
...No one knows for certain how many workers are employed by U.S...
...After that time, the firms will move on to other offshore plants, not back to the United States.41 ON THE JOB: POOR CONDITIONS, NO PROTECTION If I had been assigned to write the Singapore labor ordinances, I couldn't have done a better job for my company or any other...
...However, some firms have begun to produce automated testing machines...
...Care was taken to compile as complete a listing as possible, but it should be noted that firms move rapidly from country to country, and there are numerous examples of companies such as Fairchild Camera and Instrument Corporation which have entered and abandoned Mexico numerous times in a very short period...
...semiconductor production in 1974.10 Secondly, as we have noted previously, the firms moved to different countries for different reasons...
...New York's Off Track Betting Corporation and New Jersey's lottery, besides controlling 80% of the Pari-Mutual on-track betting system.'4 As of last year, General Instrument operated 26 plants in the United States, 5 plants in Asia, 4 in Latin America, 4 in Canada and 14 in Europe.'s LABOR AND THE RUNAWAY CAPITALIST What do General Instrument ana the other runaways find when they get to where they are going...
...Hewlett-Packard's vice-president summed it up when he remarked that "the unemployment rate is lower and cheap labor is more difficult to get in Singapore...
...They call attention to the "rising cost of labor at the offshore sites . ., increased freight hikes and the threat of tougher import regulations," as reasons why electronics producers are pulling in their horns...
...Scotland, through the Scottish Council's Electronics Scheme, has actively promoted foreign electronics investment since 1953.32 By 1970, seventeen U.S...
...electronics plants...
...The gradual increase in offshore average wage rates occurs for a variety of reasons...
...In the final article we return to the questions raised at the beginning of the Report about imports, international competition and the strategy evolved by the trade union bureaucracy to confront the runaways...
...As the unfinished receiver approaches her position, she quickly grabs a specially numbered resistor and then a capacitor and joins them to the proper wire...
...The tester has become deskilled and the job is thus exported along with other unskilled jobs to offshore plants...
...Though not thought of as a physically demanding task, the assembly of printed circuit boards nevertheless requires a steady hand and extreme concentration since the whole board will malfunction if the slightest bit of solder spatters on the circuits...
...But even this breaks down in practice...
...The clearest indication of this is the new capital investments which electronics producers are making in some of their offshore plants...
...Thus, with a high rate of turnover among women, the average wage paid to the work force as a whole tends to remain at the lowest levels...
...Within a given region (Far East, Mexico and the Caribbean, Europe), locational decisions were almost always based on wages alone...
...5 THE GANG'S ALL HERE Who has gone abroad...
...The example of South Korea is illustrative...
...Republic 4 S. Korea 19 Trinidad & Tob...
...Employment in these branches has decreased by 250,000 in the last ten years...
...S) PRODUCT DESCRIPTION 1966 1975 Television receivers S 9,515 S 103,379 Television apparatus and parts 26,041 287,736 Radio apparatus and parts 11,904 133,690 Phonographs and parts 11,083 31,051 Semiconductors and parts 51,584 617,499 Electronic memories 12,373 927,415 Consumer electronic products and parts 8,700 TOTAL 122,500 1,241,233 Sources: 1970: Economic Factors Affectinq the Use of Items 807.00 and 806.30 of the Tariff Schedules of the United States, Tariff Commission Publication 339 (September 1970), Tables 1 and 22...
...Company reports tend to be vague (lumping all foreign operations together) and interviews elusive (companies "would not specify" which country in the Caribbean they were thinking of moving to...
...In the first place, none began to run away before the 1960's, and most began their move in the mid-1960's...
...Current users of 807.00 include textile and apparel producers, producers of engines, sewing machines, office machines, parts for television and radio, and electronics...
...Since labor costs are the chief ingredient and are so uniformly low in all offshore host countries, the duties are also very low...
...The goods they produce enter this country as imports, almost always under two special categories of the U.S...
...In 1976, industry sources estimated that approximately 300,000 workers were employed in semiconductor assembly work15 in the Far East.27 Employment at Mexican assembly plants-the largest in Latin America-was approximated at 40,000 for the previous year...
...8 These Adjustment Assistance Petitions provide workers with financial aid if they can prove that they lost their jobs because of import competition (in other words, if their plants ran away to keep up with the competition...
...offshore plants seems to be neither fish nor fowl: it can't be considered U.S...
...Where they are permitted to exist at all, as in Singapore, Taiwan and South Korea, unions are government-controlled and union leaders are appointed by the ruling regime...
...Between regions, product considerations and product weights determined where companies would locate...
...31 Wages in Europe and Canada tend to be close to those in the United States...
...At Control Data's Korean plant company officials report that 11% of the employees experienced eyesight deterioration...
Vol. 11 • April 1977 • No. 4
