Displaced by Automation in Shanghai


From strategy+business:

“The CEO walked a group of visitors through the pristine, brightly lit factory. Robotic arms rotated and embedded memory chips into place. A small autonomous vehicle carrying parts rolled around the factory floor while playing a Bach sonatina. At some workstations, employees in protective clothing packed products into boxes and performed intricate soldering as the circuit boards traveled down a slow-moving conveyor belt.

“Not all the people are working very hard, but the robots are working hard,” the CEO noted. Indeed. In the past year, after installing sophisticated automated equipment, the number of human factory workers had fallen from 3,500 to about 1,800. And yet productivity has boomed. Last year, the company shipped some 30 million broadband terminals to end customers, including Verizon. On a separate floor, the company is building a series of automated production lines that will require even less labor. A video wall in a conference room displays charts that monitor production and quality in real time, and is studded with 24 panels showing live shots of the factory floor. In half of them, robots and machines are doing all the work. A few years from now, the CEO predicted, the company will need only about 800 production workers.

The assembly line jobs disappearing from this factory aren’t going to China. For this factory isn’t in Ohio, or California, or even in Mexico. It’s in Shanghai. It belongs to Cambridge Industries Group (CIG), an 11-year-old Chinese company that also has operations in the U.S. and Germany. Taking a tour of this factory with Gerald Wang, the chief executive officer of CIG, will make you think twice about the nature of manufacturing in China — and the prospects for the return of employment in manufacturing in the States.”


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