The Manufacturing Industry in Shenzhen
The growing integration of global trade markets has brought about the fragmentation of production activities, namely in manufacturing, with companies trending towards outsourcing to overseas counterparts due to the profitable benefits (Feenstra, 1998 p.31). This modern model of production characterizes the breakdown of the “vertically-integrated mode of production” also known as the “Fordist” mode specifically relating to Ford cars’ manufacturing process (Feenstra, 1998 p.31). In order to recognise the shifts in production, the conceptual frameworks relating to outsourcing activities must be taken into consideration. Ethier (1982) explores the growth of specialization across nations and the significant efficiency gains in regards to trade. By shifting production offshore, companies can reduce costs and timelines thus creating greater profits. Shenzhen can be considered an exemplary city when studying the rapid growth of a city’s economic sector.
The Competitive Environment of Shenzhen
In August 1980 Shenzhen was declared China’s first Special Economic Zone for its image as a prominent city and key design hub (UNESCO, 2010). Shenzhen is seen to be the cause for China’s economic success over the past thirty years due to its innovation and forward thinking (UNESCO, 2010). Shenzhen is located near the Pearl River Delta, in the southern area of the Guangdong Province, China (SETRO, 2014). With over three decades of growth Shenzhen has become a major strategic base for research and development programs, manufacturing and exportation of electronic products.
Shenzhen has been acknowledged as a four pillar industrial city due to its advances in the technological industry as well as information...
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...s proven to be a key part of Shenzhen’s manufacturing development and contribution to the country’s GDP (China Knowledge Press, 2004). The manufacturing industry has played in integral role in Shenzhen’s economic boom, however these advances have come at a cost to society (Passport, 2013). The moral implications for such growth must be considered when examining the extent of the city’s success, as social consequences have been incurred. The poor conditions that workers are exposed to in some of Shenzhen’s manufacturing companies can be seen as an example of the social penalties of economic achievement in China. Chan’s (2010) insight into the discrimination of workers further supports the need for Government regulations to be more strictly enforced. Overall, the industry success of the city of Shenzhen renders it an exemplary case study for economic growth.
Globalisation is a growing phenomenon that is the result of various developments in the global environment, each of which merits an individual analysis of its social impacts. For the purpose of this analysis, the focus will be placed upon arguably its most controversial aspect, offshore outsourcing. Offshore outsourcing, or offshoring, is becoming an increasingly common business practice as a result of a combination of the recent technological advancements in the areas of transportation and communication, and the increased competitiveness of the business world. From the perspective of firms, tapping into cheap labor from less developed countries is a very logical business decision to reduce costs and maximize profits. This has not only motivated businesses to engage in offshoring, it has sometimes been critical to their survival in fiercely competitive environments.
In his 1937 film Street Angel, Yuan explores the inequities facing Shanghai’s urban proletariat, an often-overlooked dimension of Chinese society. The popular imagination more readily envisions the agrarian systems that governed China before 1919 and after 1949, but capitalism thrived in Shanghai during that thirty-year buffer between feudalism and Communism. This flirtation with the free market engendered an urban working class, which faced tribulations and injustices that supplied Shanghai’s leftist filmmakers with ample subject matter. Restrained by Kuomintang censorship from directly attacking Chinese capitalism, Yuan employs melodrama to expose Street Angel’s bourgeois audience to the plight of the urban poor. Yuan presents capitalist Shanghai as a binary and deeply unequal society, at odds with the “more pluralistic sense of cosmopolitanism” desired by leftist filmmakers of the 1930s (Pang 62).
Under Capitalism, America's free market system offered opportunities of advancing personal interests for laborers while at the same time meeting the labor requirements of our economy. However, once the Chinese immigrants were in the country, capitalism yielded different results for them. The earliest Asian immigrants into any US territory were Chinese laborers in the Islands of Hawaii as early as 1836. These immigrants left a long-lasting impression on industrialists and wealthy European-American through their dedication and hard work (Takaki 21-23). Eventually this led to massive importation of Chinese labor to build everything from cities, bridges and even railroads throughout the rest of 19th century. Since owner can control or decides the labor wage, they had lowered the wage of those jobs to gain the maximum profit. In the west coast numerous Chinese laborers were massively imported as late as early 1900s to build cities. Eas...
Outsourcing emerged on the financial arena during the 1980s and has since then been spreading. Outsourcing production was furthered with the process of globalization which provided a new component leading to the strengthening of resources, skill and labor specializations across the world. The process of outsourcing is using the skill and abilities of a third-party to accommodate society on the foundation of labor. As stated earlier, it was during the 1980s that the process kicked off mainly due to the efforts of corporations when they began to hire labor forces across the world. Even though outsourcing has come out from its developing stages, there are still following effects on the US economy.
China’s economy is one very large indicator of its role in globalization. “In 2010 China became the world’s largest exporter” (CIA World Factbook). Without China many places such as the United States of America would be without billions of goods imported from China annually. An influx of companies moving their manufacturing to China has allowed people to flock to cities and find jobs. China’s economy has grown exponentially over the last few decades. In the last three years China’s economy has grown by nearly ten percent every year. Despite this influx of money to China it has also resulted in many drawbacks. For example, China’s environment has been obliterated. China burns more coal than every country in the world combined. Beijing has been so badly polluted that there are actually companies that sell cans of fresh air to people, and gas masks are a common sight. On January 12th 2013 Beijing’s air pollution reached a record setting 775 PPM. To put that into perspective, the scale for measuring pollution is 0-500 PPM. This set an all-time recorded high. In Los Angeles a high ...
The U.S. industries have been outsourcing manufacturing for several decades now. U.S. companies thought they were reducing costs by outsourcing development, manufacturing, and process-engineering abilities. Consequently, U.S. corporations’ knowledge, skilled workers, and supply chain, which are the necessities to producing advanced products, have vanished. For example, almost all notebook computers, cell phones, and handheld devices, which were once created in the U.S., are now designed in Asia. When a major U.S. company outsource, it pressures their rivals to do the same thing. They also lose the expertise of process engineering, which would interact with manufacturing on a daily basis. Minor companies and skilled workers go to where the jobs and knowledge networks are no matter where they are geographically in the world. This decline of trade in the U.S. has caused a negative chain reaction to their suppliers of sophisticated materials, tools, production equipment, and components. U.S. industries do not have a way of coming up with new ideas for the next generation of high-tech products...
According to a 2013 estimate of purchasing power parity, China has a GDP of $13.3 trillion. It has a 7.6% GDP real growth rate and ranks 120th in the world in GDP per capita. One of the prime advantages of China is a populous labor force that ranks first in the world, totaling 797 million evenly split between agriculture and services with a few less working in the industrial sector. The unemployment rate is a manageable 6.4% and a 7.7% industrial production growth rate. China exports electrical and other machinery, data processing equipment, apparel, radio telephone handsets, textiles, and integrated circuits primarily to Hong Kong and the United States, as well as to Japan and South Korea. China also imports electrical and other machinery as well as oil and mineral fuels, metal ores, nuclear machinery components, optical and medical equipment, motor vehicles and soybeans. Its primary import partners are South Korea, Japan, Taiwan, United States, Australia, and Germany. China utilizes transportation through its 507 airports, and a railway system that ranks 3rd in the world totaling 86,000 km. China also makes use of its roadways totaling in excess of 4,000,000 km and stakes claim to the largest amount of navigable waterways in the world. Major seaports include: Dalian, Ningbo,...
“Philips, Sony, and Toyota factories are popping up all over—to the self congratulatory applause of the nation’s governors and mayors, who have lured them with promises of tax abatements and new sewers, among other amenities.” (Paragraph 17) People are born into their jobs, and are doomed for their economic boats. IN other countries such as China, it has been proven that the families with the moneys are the ones with the money, are the ones with the economic power. “Many wealthy Chinese and western residents moved their money abroad and some actually left the colony. By 1971, the Cultural Revolution in China had ended in failure and conditions in Hong Kong calmed,” (Lannom) such as Gloria Lannom states, yet it took a while for Hong Kong to rebuild its economic standings because of this
...st and stand in the world. It is predicted that China will one day be the largest economy growing country in world. They continually growing and rebalancing their world to be the best. The growth of economy will depend on the Chinese government comprehensive economic reforms that more quickly accelerate in China transition to a free market economy. The consumer demand, rather than exporting the main engine of economic growth; boost productivity and innovation; address growing income disparities; and enhance environmental. (Morrison, 2014,para2)
Spatz, J., & Nennenkamp, P. (2002, January). Globalization of the automotive industry-traditional locations under pressure. Retrieved January 14, 2012, from http://www.uni-kiel.de/ifw/pub/kap/2002/kap1093.pdf
Hoobler, Dorothy, Thomas Hoobler, and Michael Kort, comps. China: Regional Studies Series. Upper Saddle River, New Jersey: Globe Fearon, 1993. 174-177.
Having poor working conditions impacts the society in such a way that workers are depressed and do not work in peace. Apple should look for ways in which their suppliers can offer working conditions that are humane. If the current suppliers do not improve their working conditions, then Apple should consider looking for other suppliers since the working conditions of their workers should be of most priority (Apple Inc. 2016). Moreover, having good working conditions will attract more qualified personnel into the company, thus increasing the quality of their products. However, the main problem in Apple making sure that their suppliers offer better working conditions is that Apple has no legal liability in any operation that happens in China factories since their ownership is by separate manufacturers. It, therefore, gives Apple the dilemma of choosing between what is correct morally and what is correct legally. It also represents situations that are unfortunate since an action of being socially responsible is not what is best for the running of the business as using cheap labour to minimise cost has led to Apple to achieve margins that are spectacular and profits on its products (Dhaliwal 2011, 59-100). Apple should keep in mind that the aim of business is not always based on making profits since long-term goals are
Zhu, Y. & Warner, M. (2000). “An Emerging model of employment relations in China: a divergent path from the Japanese?” International Business Review, 2000, Vol.9 (3), pp.345-361. [03 April 2014]
China's development is praised by the whole world. Its developments are not only in the economic aspect, but as well in its foreign affairs. Compared with other developed countries, China is a relatively young country. It began constructing itself in 1949. After 30 years of growth, company ownership had experienced unprecedented changes. Entirely, non-state-owned companies can now be more involved in sectors that used to be monopolized by state-owned companies.
Currently in the global environment, there is a strong sense of competition that must be achieved through better performance, almost all firms are competing in international markets due to the reduction in barriers for capital and tariffs. With the new changes in both communication and technology, the consequences faced are that production processes are no longer within national boundaries but spread across (Debrah & Smith, 2002).