1 00:00:00,000 --> 00:00:06,680 Thanks for watching tech wiki click the subscribe button then enable notifications with the bell icon so you won't miss any future videos 2 00:00:07,220 --> 00:00:12,420 Wherever you are in the world, you won't have to look hard for somebody using an iPhone 3 00:00:12,580 --> 00:00:18,600 So you might think then that because the iPhone is just about everywhere Apple has facilities 4 00:00:18,760 --> 00:00:20,880 Turning out iPhones all over the world 5 00:00:21,080 --> 00:00:26,400 But the truth is that most of them are assembled in just one country China 6 00:00:26,400 --> 00:00:29,280 And this isn't just true for Apple gadgets 7 00:00:29,280 --> 00:00:35,100 I can virtually guarantee that if you take a closer look at any of the mass-produced gizmos in your home 8 00:00:35,100 --> 00:00:39,840 You'll find at least some parts of it that were made or assembled in China 9 00:00:40,500 --> 00:00:44,500 But why is China such a powerhouse for electronics manufacturing? 10 00:00:45,260 --> 00:00:51,040 many people assume that it's because China has a huge and inexpensive labor force and 11 00:00:51,480 --> 00:00:53,480 There's definitely some truth to this 12 00:00:53,700 --> 00:00:56,440 Not only is China the world's most populated country 13 00:00:56,760 --> 00:01:03,180 But it has lower minimum wages than much of the Western world in Shenzhen one of the world's largest high-tech 14 00:01:03,600 --> 00:01:07,620 Manufacturing hubs the minimum wage is less than three US dollars per hour 15 00:01:08,000 --> 00:01:14,760 But a large pool of cheap labor is far from the only reason that China is attractive to tech companies back in the 16 00:01:15,260 --> 00:01:21,640 1970s the Chinese government became interested in moving away from strict central planning and 17 00:01:21,960 --> 00:01:25,500 Toward opening up its economy to outside investment 18 00:01:25,920 --> 00:01:33,440 One part of this was designating the aforementioned Shenzhen as a special economic zone which encouraged 19 00:01:33,680 --> 00:01:38,540 foreign private businesses to set up shop in the area through tax breaks and 20 00:01:39,260 --> 00:01:47,200 relative freedom from Beijing's regulations China was especially interested in having these companies manufacture exports 21 00:01:47,680 --> 00:01:55,040 This strategy ended up proving very attractive for foreign firms and today Shenzhen is one of the world's busiest 22 00:01:55,500 --> 00:01:59,400 As many of the companies who put down roots there ended up building 23 00:01:59,780 --> 00:02:07,740 massive factories that can very quickly scale production if there's a huge contract to be fulfilled like right before a new iPhone would hit the 24 00:02:07,740 --> 00:02:14,340 market and remember that in addition to factories and laborers to work the assembly line you also need 25 00:02:14,680 --> 00:02:22,720 Engineers to oversee them and China has a massive number of engineers that can provide middle management way more than countries like the u.s. 26 00:02:23,320 --> 00:02:25,320 furthermore because of the sheer 27 00:02:25,320 --> 00:02:33,280 Scope of these facilities China can offer supply chain advantages lots of these factories focus on custom fabrication 28 00:02:33,820 --> 00:02:40,880 So everything from plastic injection for keyboards to making sure that a screw is the right shape and the right size 29 00:02:41,340 --> 00:02:47,240 This means that because they don't have to wait around for a part to arrive from the other side of the world 30 00:02:47,820 --> 00:02:55,100 China's manufacturers can respond quickly to customer demands or 11th hour design changes to top it all off 31 00:02:55,500 --> 00:03:00,440 Many Chinese manufacturers aren't focusing just on the export market anymore 32 00:03:00,880 --> 00:03:06,060 Folks who live in China are spending more on consumer goods than they ever have before 33 00:03:06,520 --> 00:03:12,300 Including electronics and with 1.4 billion potential customers right in their backyard 34 00:03:12,860 --> 00:03:20,120 Many of these companies are trying to expand their capacity even more to tap into the wallets of Chinese citizens 35 00:03:20,120 --> 00:03:24,540 Of course, this model is largely built on maximum efficiency 36 00:03:24,540 --> 00:03:28,580 which has led to a lot of controversy over the years about things like 37 00:03:29,160 --> 00:03:35,860 environmental standards and pollution wages company policies regarding attendance and interactions with co-workers 38 00:03:36,320 --> 00:03:43,880 forced relocation to often cramped on-campus living quarters a need to be available at a moment's notice and even 39 00:03:44,220 --> 00:03:52,120 Accusations of forced labor and these have led many observers to call out companies who they perceive to be using something akin to 40 00:03:52,380 --> 00:03:53,640 sweatshop labor 41 00:03:53,640 --> 00:03:54,420 but 42 00:03:54,420 --> 00:04:01,240 The fact that demand is so high for electronics makes this a problem with no immediately obvious answers 43 00:04:02,060 --> 00:04:08,680 Especially since consumers seem to be finding it very difficult to vote with their wallets so to speak 44 00:04:09,060 --> 00:04:11,280 Many things that might have been considered 45 00:04:12,060 --> 00:04:18,920 Frivolous gadgets ten years ago like smartphones are quickly becoming necessities of modern life and last time I checked 46 00:04:19,380 --> 00:04:24,240 none of those are made in the USA by middle-class workers making 47 00:04:24,420 --> 00:04:25,520 union wages 48 00:04:25,520 --> 00:04:29,260 So sound off in the comments with your opinions and let us know your ideas 49 00:04:29,520 --> 00:04:35,600 And also let us know if you'd like to see more videos like this one about the forces that drive the technology industry 50 00:04:36,060 --> 00:04:38,920 Speaking of forces that drive squarespace is a force 51 00:04:38,920 --> 00:04:42,860 That's driving a more 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