Yesterday, Apple’s iPhone maker, Foxconn announced an immediate cut of 60,000 workers to be replaced by robots.
Today, Adidas announced the first ever 100% robot-made shoe.
“Speedfactory”
Deutsche Welle, Germany’s international broadcaster, reports Adidas Shoe Manufacturing Will Return to Germany.
That’s the good news. For manufacturing job seekers, the bad news is the shoes will be 100% robot made.
Your next pair of Adidas shoes may be put together by robots – the German sports retailer has said it will start selling its first robot-produced shoes in a new, state-of-the-art factory in its home market starting 2017.
The announcement came as Adidas unveiled its prototype “Speedfactory”, a state-of-the-art, 4,600 square-meter facility on Tuesday, meant to automate shoe production, which is largely done manually in Asian factories at the moment.
The new production site in the southern German city of Ansbach is still under construction, but it represents a return to local production for Adidas, which stopped manufacturing shoes in its home market more than two decades ago in favor of Asia.
But the company has struggled with steadily rising wages across the continent, where it employs around a million people.
Six subcontractors of Adidas in China declined to comment or said they were not aware of the new production sites in Germany, news agency AFP reported.
The factory will deliver a first test series of around 500 pairs of shoes to be sold from late 2016, with large scale production targeted for next year. Adidas management also said the shirts of the German national football team could be produced in the same factory too.
The sportswear and equipment company also plans to open a second Speedfactory in the United States in 2017, with similar ones to follow in Britain or in France.
Adidas produced 301 million pairs of sport shoes last year, but it has to ramp up production by more than 10 percent if it is to reach its growth targets by 2020.
Its chief competitor Nike is also developing a robot-operated factory, but Adidas said it is further along in this area.
Many Millions of Chinese Shoe Manufacturing Jobs Will Vanish
Adidas insisted that the aim was not to immediately replace their workers, saying the goal was not “full automatization”.
I believe the emphasis should have been put on “immediately”. As for “full automatization”, someone has to monitor the robots.
Let’s not sugar coat what’s going to happen. 1,000,000 Adidas shoe making jobs in China will vanish by 2018. Nike? Converse? Everyone else?
I cannot begin to total this up, but many millions of Chinese manufacturing jobs will soon vanish.
Robots Taking Over
Also consider Robots Taking Over: Foxconn Terminates 60,000 Employees, Hires Robots! (emphasis theirs)
In one of the largest terminations ever recorded in human history, iPhone manufacturer Foxconn has decided to fire 60,000 employees in one single go. Earlier this factory based out of Kunshan in Jiangsu province of China had 110,000 employees, but now, it will only have 50,000 human employees.
Robots have been introduced in a massive manner, and tasks of these 60,000 terminated employees would now be done by these robots.
Department’s head Xu Yulian said, “The Foxconn factory has reduced its employee strength from 110,000 to 50,000, thanks to the introduction of robots. It has tasted success in reduction of labour costs,”
And the interesting aspect is that, almost all of the 600 major manufacturing companies based in Kunshan are about to fire humans, and assign their tasks to robots. In fact, 35 biggest manufacturing companies from Taiwan, including iPhone’s main manufacturer Foxconn have spent a collective 4 billion yuan or HK$4.74 on improving and optimizing automation.
And this recent termination of 60,000 humans is just the start.
Earlier this year, we reported that top Indian IT companies hired 24% less employees; and automation is the reason for this sharp decline. Cognizant Technologies was the company which was impacted to the max, as they hired 74.6% less employees in 2015, solely due to rise in automation.
No Worries Mate
No worries mate, home building will remain strong thanks to $15 minimum wage jobs at McDonalds. The real problem is labels.
We Need New Labels
Current labeling is obsolete. Why bother with Made in China, Made in Japan, and Made in USA type labels.
Adidas is going to open a “Speedfactory” in the United States in 2017, with similar ones to follow in Britain or in France.
The equipment will be the same in each one. The resultant product will not change a bit.
Instead of “Made in USA” or other useless country of origin factoids, consumers might wish to know things like … “100% Robot Made”.
New Slogans Needed
Instead of “Buy Union!” we need “Buy Human!”
Mike “Mish” Shedlock
Mish
We already have one of those labels. It reads “Untouched by human hands.”
“No Human Touch”
https://m.youtube.com/watch?v=85cNRQo1m3A
Just stop buying from companies such as Adidas and Apple. Stop ‘eating’ at McDonalds. Don’t deal with any corporation that sacks its human workforce in favour of robots.
They’ll soon change. But I’m not holding my breath!
If consumers were actually TOLD that buying Chinese imports or illegal immigration labor or automation was going to eliminate their jobs….with no alternative recourse for income…maybe they might listen. As is, few politicians and even fewer manufacturers will say this aloud. They simply pretend that new jobs will magically appear because after all, they did after we invented the wheel.
People are not all that stupid, they are simply deluded into ignoring what they know to be true for the fiction of what “could be”, based upon the promises of people profiting from the lie.
The first step is the acknowledgment of our reality that there is no free ride, that everyone must work and produce to justify if not ensure their existence. The lie that we can buy what we want, DO what we want, without consequence is simple madness. Meanwhile they just keep standing up fall guys to perpetuate the myth until disaster strikes and then the public is allowed to dispose of them for a new and ever hopeful lying face to take their place.
Who will blame next for believing their lies?
With every new invention, some aspect of human worth is devalued, putting more emphasis onto the remaining components.
Invent mechanical machines and the human muscle will go obsolete, but the brain will become twice as valuable, for as long as machines don’t run themselves. Invent an electronic brain and be ready to surrender everything there is to being alive.
Our future ends here.
“Our future ends here.”
Our future changes here. Human muscles did not go obsolete because mechanical machines were invented. Despite the invention of the car, people still do 10K runs. Even with 100% robotic manufacturing, there are people who will create things by hand, such as pottery or blown glass, because that is what they want to do with their time.
I have not been in a Wal-Mart in ten years because I refuse to buy the Chinese crap they peddle. Their executives should have all been hanged for treason years ago and their stores pillaged and looted by Trump voters.
“Buy Human” is the reactionary, Luddite and unconsciously socialist sentiment.
You’re all nascent Social Crediters.
And if robots were the luddites and we were… ‘outdated’?
That’s science fiction. And even if, emphasis if, machines can someday ACTUALLY become conscious we’ll just have to write “sunday school” ethical programs for them I guess.
More subtle than that … meaning:
If robots (robotic production etc.) were established as the quo , but people wanted something new or different , the robots (their ‘masters’) , would not allow it to happen (luddites) , and people , now being completely expendable to their needs (of the ‘masters’) , as well as dependent on robotic production, would become … ‘outdated’ .
It is only extending the current economic, social and political model one notch higher … by the worst of its direction.
Monetary Grace as in Gifting of sufficiently freeing amount frees both the individual from coercion by the Banking or commercial powers, and businesses themselves from the domination of Finance. Freedom…once it becomes real/actualized by the individual…doesn’t tolerate domination and as per above is free from its coercion s. So how would a society with that mentality not allow new productions, even hand made productions, which would probably become a profitable niche market?
It is quite possible that social credit , guaranteed income , or similar will be used/demanded to balance out what may be a new paradigm in productivity and work. Already social benefits provide a certain amount of adjustment to that end , with central financial manoeuvring used to distribute both to the public and business in varying degrees . Though you speak of an ideal mentality , and I do understand your vision , gifting as you would label it would be centrally controlled , otherwise we would be no different than currently where people are free to gift . So automatically , no matter how well meant , we are talking of a state imposed and legislated framework , one that may be morally adhered to or not by the public . You are unlikely to find any business voluntarily giving away its produce for free , that is clear enough , not just because the competitive disadvantage that that places on it compared to others (unless it sought higher sales by the gesture , that in itself indicating a profit motive and not a purely moral one) and which might be levelled under a global system , but because it runs against the ethic of competitive trade .
That would mean a person/business produces to the extent that he feels able to bargain it for the best return , it is part of his motivation . You are unlikely to find someone who has a spare hour deciding to labour to contribute to society by his own will , though that does happen in dedicated societies , where participation is its own reward , usually one of standing.
Any of the ideas that suggest removing the profit and distributing it will have a generally negative effect unless you happen to have a society that is committed to that arrangement and educated to its purpose . In real life education is much closer – you work to get paid , or you get nowhere , only family tend to share in the manner described , and even then usually judiciously .
So how would your view not work ? If everyone shared the mentality , vision, ideal , motivation and were freely adhered , maybe it would . On the other hand definition of accountability of meaning or effort might become vague , the profit sharing mechanism counter productive or corrupted , and where society came to depend on that as a means to survival their loyalty may end up being to the ability to claim , not to provision of that ability . You could end up with exactly the same conflict of interests , but via a different route , where control of the realm of legislated share of public access to production became the battleground over the diminishing returns , a public monopoly of non-production functioning only at the discretion of those that know how to manage, or own, the means to produce . Often the state simply nationalizes everything to settle the score , or enters into full complicity with the productive owners .
Each idea of this kind is more virtuous than the last , but I don’t need to give you a scorecard on how they often end .
All spoken as a reflection , not a judgement .
We would mythologize their creation, and threaten them with the inferno of the scrapyard furnace if they don’t worship us. After all, we created them in our likeness.
FL.
One robot says to another, of people:
“We should mythologize their creation, and threaten them with the inferno of the scrapyard furnace if they don’t worship us. After all, they were created them in our likeness.”
I actually saw a garment 10-15 years ago with the label “Made by Humans”. I think “Humans” might have been the name of the company, and I thought it was clever, and amusing. It would be more amusing today.
If the cost of labor is no longer a consideration, the choice of WHERE to put your factory is going to be based on tax and regulatory policy. So that still leaves out Illinois and any country run by Bernie Sanders.
Tax and regulatory policy is already one of the primary drivers of where to manufacture. Any outsize risk in those two areas overshadows labor and logistics cost by a large margin.
“If you want a vision of the future, imagine a boot stamping on a human face – forever.”
– George Orwell
Without jobs, the only consumers for these shoes will be Boston Dynamics bipedal law enforcement droids.
At one point some years ago workers were craftsmen and handmade was a mark of quality. I don’t think that is a socialist idea
The real question that should be asked about Foxconn is what took them so long?
The answer is, of course, that the speed with which automation is adopted depends on the relative cost of man versus machine. When labor is cheap, as in Foxconn’s case, robot adoption is relatively slow, and incomplete. When the prevailing wage rate is high, as in Germany, robot adoption will be far quicker and more complete.
I presume that the purpose of adopting a $15 minimum wage in the US is to encourage faster and more complete adoption of robots. If the US is going to be competitive in the world economy in the future, we need to move quickly to a 100% robot economy, and get away from the quaint historical concept that people should have jobs. Raising he minimum wage quickly, and to a high level is the best way to accomplish that.
Well at least the Progressives will be happy… those evil sneaker Corporations won’t be exploiting all those workers any more!
Good point – robotics are going to cause a lot more upset to developing countries than the west (where we are socialistic service economies to a large degree already ) .
No more selling/offloading children to work shops , they will starve or ‘not be born’ in some countries . Wages are so low in other countries , just bare survival , you place competition there and those who lose … lose completely .
It isn’t a joke , millions of new unemployed in countries that have not developed more than to adjust to a (historically trivial in terms of millennia of evolution) western demand , while leaving behind their rural abilities , run by corrupt or disorganized military minded governments does not bode well .
But those in favour of robotic evolution already have the solution to that , or do they ?
If it has costs , it is not our problem , the eventual reality will be better ?
We don’t know . The argument follows similar lines in many ways to the original outsourcing of productivity to the developing world . Even those of selfish mind should be concerned of the balance of what are now well armed neighbouring countries . So far we have regime change so wrong that it has to be right , I don’t look forward to the day when it stays wrong for us in some larger country .
Robot shoes are higher quality with consistent sizes. The same goes for automobile engines manufactured after 1986 with automated machine tools using the Renishaw probe.
Is it the perfection of production or the perfection of life that we seek? Is it the deal we get that comes from a container from one of China’s many slave wage labor shops, or the food we buy from a local farmer sensing they labor and effort expended to provide us good food. Our quality of life HAS to be more than simply the good deal, the something for nothing, or even the quality of production.
‘Twas the dawn of the machine.
Across the dales sleeping men, women, and children were woken from their blissful slumber, by a whirring repetition carried on the breeze.
It said ‘ I am your future, your existence will be shaped by me’.
And some rejoiced, while others fought, and yet more fled, but each and every one struggled to absorb , what their old existence had been and what the new one brought.
But if you don’t like the sweat shops, then robots solve that problem. If you want hand made artisanal items where the manufacturer pays workers a living wage, those products are freely available at a higher price point.
Quick, invent a consumer crazed robot to buy all this crap.
You’re surrounded by them …
Isn’t it Indonesia that has the strong shoe-making sector?
Has anyone considered that falling incomes, coupled with weak demand, are pressuring prices of goods lower? In tandem with this, ZIRP has distorted the capital markets, and made it cheaper to substitute capita; for labor.
Yes – I have mentioned that many times
Cheap money and high minimum wages encourages robots
And insane unions
So where to from here? It’s obvious robots are going to be the future. So what are the jobs of the future? Are we even going to need to work? How will this change society? How will we define ourselves? A great technologically disruptive tidal wave is coming but I don’t hear anyone talk about what that means for the future.
It means leisure which is not idleness, but self interested directed activity. Technology has been attempting to lift the so called “curse of Adam” for millenia. We need to embrace this change with open minds and joy.
Mish –
Why would wealth redistribution schemes not be necessary in such an automated society (i.e. Where the very, very select few own all the robots and capital equipment)? Yes, I understand that other jobs would be created (eg to maintain the boys, write code, etc.), but on nowhere near to scale to produce income for the massive majority of people that will be out of work (and, yes, info mean massive majority). The only feasible ending to the current projection is that there will be a class of capital owners, and their protectors (think militarized police, fire, etc.), no middle class, and a permanent underclass of billions and billions of humans. I’m curious as to your thoughts on how you think that this all plays out.
Mish thinks everyone is going to be a blogger like himself in some brave new world. In fact it is much more likely everyone will be making amateur porn and working as cam models.
Soylent Green (1973) tells that story, set in 2022. Right on time.
If the majority of people had been content to just stay on the farm scratching out a subsistence living, then none of this problem would exist today. Put some blame on those mechanized looms in England in the 1800s. The Luddites failed to stop the mechanization of work, and look at the results: More workers than ever before in human history.
A million displaced workers in a population of multiple billions is like random static in the system, and should be recognized as just a continuation of the mechanized loom trend. Handcrafted will never go away. You will just have to pay more for it. The average person won’t know the difference, and won’t care. They will buy because of the resulting price deflation, and the central banks of the world will continue their failing monetary idiocy in the ludicrous quest to inflate away government debt. Robots are not the problem, and anyway it is centuries too late to stop the trend.
“If the majority of people had been content to just stay on the farm scratching out a subsistence living, then none of this problem would exist today.” As told in the opening title sequence of Soylent Green:
https://www.youtube.com/watch?v=73ory53HYMw
… and you know how that turns out.
Because the bank is printing too much people inflation, no one could afford shoes made by people. Companies now charge $350 just to rake your leaves. Inflation of anything done by hand is out of control.
Mish,
Which Robot manufacturing companies should we invest in, which will benefit from this trend. Can you please post research report of best investment in this sector.
Also please provide research report summarizing which skills will be in high demand to manufacture robots. For those who are venerable loosing job, are there degree/certification course they can do to make transition to benefit from technological wave and benefit economically.
We need to be looking for opportunity and prepare American workforce to retrain themselves to staff robot factories when Chinese manufacturing starts relocating in USA. With all high level contact you have are you willing to start initiative to help retrain American workforce for those who are willing? I will be glade to volunteer and help.
You’re joking right? An automated plant requires almost no workers to run. Yes we are all going to be robot repairmen! NOT! The robots are repaired by other robots. No job for you! Next!
All these robot staffed factories producing product that can’t be purchased by unemployed workers. What is needed is some sort of reserve system to purchase excess inventory at a scientifically determined price. These inventories could be kept as excess reserves and then resold when the scientifically determined price is exceeded in the market. Now we have full robot employment and also stable prices as reserve inventory comes online to offset potential price increases. Of course I would recommend a 2% increase in prices annually to provide economic stimulus.
Gee can we make the robots pay FDIC taxes tooo!!!! I see no problem just make sure they receive all the benefits any hard working White male used to get.
So, we are not going to by automotive vehicles (build with industrial robots, painted with industrial robots), granted there is still a work force, but it is diminished. We are not going to fly planes because Boeing and Embraer are painting these with robots?
What about automation assembly lines – go watch “How its Made”…
Automation is a part of our world. Without attempting to sounding callous, who has worked in automation industry in this forum? I am and earning a great pay. We are training high school kids to start in our companies that have the aptitude to work in this industry. Engineers are (if they are willing to travel) work and earn fantastic pay….
How about the decimation of the coal industry…for solar? No-one seems to be up in arms about that….
*Not in America with carbon taxes, robots avoid carbon taxes like Vampire squids avoid indictments.
Next up the morality of national energy handicaps in nations with trade deficits.
The time of change is coming. People without job = simple lives, minimum spendings and living as we used to in 1800. Hard work because everything will be made by us (housing, transport, clothing, cooking, etc. etc.) But maybe stress free and with more joy.
Mish… this just came through to my email…
http://www.greenhousegrower.com/technology/harvest-automation-robot-helps-you-move-plants-without-people/?utm_source=knowledgemarketing&utm_medium=newsletter&utm_campaign=ggenews+06152016&omhide=true&eid=225556778&bid=1434149
Have a good day!