In an interview with Tim Cook last December, Bloomberg Businessweek asked the Apple CEO what it would take to "get Apple back to building things in the U.S."
The question prompted Cook to share a little-known fact: the processor for the iPhone and iPad is already made in the U.S., he said, and so is the glass. "And next year," Cook added, "we are going to bring some production to the U.S. on the Mac."
How much production? Cook didn't divulge the details, except to say that Apple is planning to invest $100 million in the move. That's enough to be good news to American manufacturers, but--as today's infographic shows--it's not going to come close to shifting the global balance of Apple suppliers.
Using data provided by Apple, the Center on U.S.-China Relations created an interactive map of every major manufacturing location of "suppliers who provide raw materials and components or perform final assembly for Apple."
Of 748 total suppliers, 663--or about 89%--are in Asia, with 44% of the total in mainland China. North America is home to just over 10% of all Apple suppliers.
You can explore the interactive for yourself here-- zoom in on Texas to find the makers of the iPad processor, and pan over to Kentucky to find out who makes Apple's glass.
Pretty amazing that it takes over 700 suppliers to build an iPad... At 653 grams, the average supplier is contributing just 0.87 grams to the total.
Apple really believes in hiring American huh?
Now why could that be that most of the manufacturing is in China? The answer that I usually get from the politicians to this question is “the labor is cheaper over there”. Is that it?...the labor cost is the deciding factor for everything in manufacturing?
Germany has the same problem with loss of manufacturing jobs and this is the same answer that the politicians give…”the labor costs”…and then they compare the daily wage of the workers in China to that of the Germans…usually with no reference to what the actual cost of living in China is compared to Germany.
However there are more items that have to be factored into the cost of doing business than just the labor costs. Items like the corporate tax, the contribution of the employer to the social security system and usage fees and taxes…these are almost always paid directly to…the government. But politicians usually omit this part when discussing this topic.
In Germany they can be very creative on how they can dip into the business owners pocket. Here is a for instance…I have a small ( and I mean small) business on the side where I make soap and creams. Upon registering my business with the chamber of commerce I was asked how I package my soap and how much packaging I use per year…because there is a packaging fee that must be paid. Now, most soap is packaged in paper. So after the manufacturer pays the packaging fee it goes to the consumer who discards the paper in the garbage…but there is mandatory recycling in Germany and so it is recycled. But the consumer has to pay his garbage fee for the “waste” that he produces. Then along comes the recycling company and either A) recycles the paper to use again or B) takes it to a waste to steam plant where it will be burned for fuel to provide a utility service that is sold back to the public.
The end result is that there are two fees (packaging fee and garbage fee) that are paid for a material that is reused as a resource and sold back to the public…and it all goes into the pocket of the government.
If America and Europe want to keep more jobs within their boarders the first place to look is the government’s politics toward domestic business.