WEBVTT 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 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 00:00:12.580 --> 00:00:18.600 So you might think then that because the iPhone is just about everywhere Apple has facilities 00:00:18.760 --> 00:00:20.880 Turning out iPhones all over the world 00:00:21.080 --> 00:00:26.400 But the truth is that most of them are assembled in just one country China 00:00:26.400 --> 00:00:29.280 And this isn't just true for Apple gadgets 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 00:00:35.100 --> 00:00:39.840 You'll find at least some parts of it that were made or assembled in China 00:00:40.500 --> 00:00:44.500 But why is China such a powerhouse for electronics manufacturing? 00:00:45.260 --> 00:00:51.040 many people assume that it's because China has a huge and inexpensive labor force and 00:00:51.480 --> 00:00:53.480 There's definitely some truth to this 00:00:53.700 --> 00:00:56.440 Not only is China the world's most populated country 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 00:01:03.600 --> 00:01:07.620 Manufacturing hubs the minimum wage is less than three US dollars per hour 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 00:01:15.260 --> 00:01:21.640 1970s the Chinese government became interested in moving away from strict central planning and 00:01:21.960 --> 00:01:25.500 Toward opening up its economy to outside investment 00:01:25.920 --> 00:01:33.440 One part of this was designating the aforementioned Shenzhen as a special economic zone which encouraged 00:01:33.680 --> 00:01:38.540 foreign private businesses to set up shop in the area through tax breaks and 00:01:39.260 --> 00:01:47.200 relative freedom from Beijing's regulations China was especially interested in having these companies manufacture exports 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 00:01:55.500 --> 00:01:59.400 As many of the companies who put down roots there ended up building 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 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 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. 00:02:23.320 --> 00:02:25.320 furthermore because of the sheer 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 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 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 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 00:02:55.500 --> 00:03:00.440 Many Chinese manufacturers aren't focusing just on the export market anymore 00:03:00.880 --> 00:03:06.060 Folks who live in China are spending more on consumer goods than they ever have before 00:03:06.520 --> 00:03:12.300 Including electronics and with 1.4 billion potential customers right in their backyard 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 00:03:20.120 --> 00:03:24.540 Of course, this model is largely built on maximum efficiency 00:03:24.540 --> 00:03:28.580 which has led to a lot of controversy over the years about things like 00:03:29.160 --> 00:03:35.860 environmental standards and pollution wages company policies regarding attendance and interactions with co-workers 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 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 00:03:52.380 --> 00:03:53.640 sweatshop labor 00:03:53.640 --> 00:03:54.420 but 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 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 00:04:09.060 --> 00:04:11.280 Many things that might have been considered 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 00:04:19.380 --> 00:04:24.240 none of those are made in the USA by middle-class workers making 00:04:24.420 --> 00:04:25.520 union wages 00:04:25.520 --> 00:04:29.260 So sound off in the comments with your opinions and let us know your ideas 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 00:04:36.060 --> 00:04:38.920 Speaking of forces that drive squarespace is a force 00:04:38.920 --> 00:04:42.860 That's driving a more beautiful internet for everyone with squarespace 00:04:42.860 --> 00:04:48.900 You can build a simple powerful beautiful website with just about 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