“Made in China”, is a phrase we all know, whether you like the content behind it or not. One of the reasons why China has become the vibrant economy as it is today is that Western companies have been setting up factories in the country for the past 40 years, due to cheap labor costs over there. But while new techniques such as 3D printing are slowly overtaking traditional manual labor in factories, the advantage of cheap labor in China is suddenly slipping away.
China is still the number one country in manufacturing, followed by the United States of America. However, noting that new techniques enable Western companies to automate their manufacturing work, this number one position is not a security for the country. Labor costs have been rising in China and the country is not even part anymore of the world’s top 10 countries with the cheapest labor. Of course as a result of this, general conditions have become better for the Asian country, but does it also imply China dying of its own success?
Since Bangladesh has people working for 23 cents per hour and in Madagascar workers even earn less than 20 cents per hour, the consequence has been that Western companies moved their businesses to such countries instead of China, leading to the horrible 2013 factory disaster in Banglasesh. In addition, oil and transport costs have become more expensive, which implies moving back their businesses to Western countries can become more profitable for major Western companies. For such reasons, American multinational General Electric Appliances (GE) has decided to “reshore” to America, and other giant companies such as Whirlpool and Ford, but also smaller enterprises are carefully following GE’s example.
It is expected that 3D printers will take over a lot of manual work, meaning companies will be less dependent on human labor. Will this be the fall of China? Of course not. One thing that’s very striking about China is that recently the country has been highly innovative in 3D printing developments. China has already built the biggest 3D printer of six meters in diameter (!). This 3D printer is expected soon to be able to print out automobile sizes metal objects. The country even wants to become the world’s number one country in 3D printing, to keep on being one step ahead of the Western world.
Image credits: news.cn.