“Apple’s iPods are made by mainly female workers who earn as little as £27 per month, according to a report in the Mail on Sunday yesterday. The report, ‘iPod City’, isn’t available online. It offers photographs taken from inside the factories that make Apple music players, situated in China and owned by Foxconn,” Macworld UK reports. “The report claims Longhua’s workers live in dormitories that house 100 people, and that visitors from the outside world are not permitted. Workers toil for 15-hours a day to make the iconic music player, the report claims. They earn £27 per month. The report reveals that the iPod nano is made in a five-storey factory that is secured by police officers.”
Macworld UK reports, “Another factory in Suzhou, Shanghai, makes iPod shuffles. The workers are housed outside the plant, and earn £54 per month – but they must pay for their accommodation and food, ‘which takes up half their salaries,’ the report observes. A security guard told the Mail reporters that the iPod shuffle production lines are staffed by women workers because ‘they are more honest than male workers.'”
Full article here.
“The situation is too murky for a rush to judgment on Apple’s ethics here, and it may well meet minimum global standards. But for a company that has staked its image on progressive politics, Apple has set itself up as a potential lightning rod on global labor standards. Sweatshops came back to bite Nike after its customers rose up in arms; and Apple can expect a similar grilling from its upscale Volvo-driving fans in the months ahead,” Leander Kahney writes for Wired News. “Tech companies’ records in China are in the spotlight for a wide variety of human rights issues. Google and Yahoo have weathered a lot of criticism — quite rightly — for censoring search results and cooperating with the Chinese authorities cracking down on dissidents. I’m not naïve enough to expect companies to behave morally like individuals, but I find Google’s corporate mantra ‘Don’t be evil’ to be especially galling. They dropped that one pretty quick.”
“All of this should put Apple on notice that doing business in China in anything less than an exemplary fashion is a recipe for a PR disaster,” Kahney writes. “Apple is just one of myriad companies using Chinese factories to make its products. And of course, it does so purely because of China’s low wages and other costs. The iPod is assembled by Invatec and Foxconn, two manufacturers headquartered in Taiwan that own factories in China and elsewhere. Foxconn is a trade name of Hon Hai Precision Industry, a $16 billion giant and one of the largest electronics manufacturers in the world, which makes everything from Playstations for Sony to iPods for Apple. Nicholas Lardy, a senior fellow at the pro-globalization International Institute for Economics, said Hon Hai has an ‘excellent reputation.’ He says factories in China operated by big global companies like Hon Hai are very different from smaller, indigenous operations. International giants usually enforce the same work practices in China as they do in other parts of Asia, or Europe and United States, according to Lardy.”
Full article here.
MacDailyNews Take: Regardless of the story’s validity (we need to know more from more sources first), Apple should make sure that the people who are assembling Apple products in China and all other countries are treated better than the accepted base standards. It’s good business, it’s the right thing to do, and it’s what we expect of Apple.
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I could care less. When I buy a product, I could give fuck all if they pay their employees the going wage or 10 times the going wage.
The WallMarts of the world are filled to the rafters with yellow belly rights campaigners shopping for the cheapest underwear they can buy from any stinkhole in the world.
Good take, MDN.
We hold Apple to a higher standard than others, so it would be nice to say that their business practices are better as well.
The wages probably aren’t that bad considering their economy and cost of living, but the hours are horrible. 15 hours a day doesn’t leave much time for anything else. I can understand not allowing visitors into the factory, but not allowing visitors into the dorms is pretty bad too.
“It costs Apple $90.18 in materials to build the unit and $8 to assemble it”
So we’re outsourcing our jobs to save $10 per iPod?
“But for a company that has staked its image on progressive politics…”
More BS.
I don’t recall Apple ever taking any kind of political position on anything.
a) It’s not reasonable to hold Apple to a standard that will put them at a competitive disadvantage.
b) You can’t force a country like China to change overnight, it would throw them into economic AND cultural turmoil.
c) The slow steady path it the best in matters of economic development.
I occasionally work with folks from HonHai. I used to tease one gal about being a repressed commie. She would laugh and say, “you Americans don’t understand”. She seemed pretty content to me.
Steev:
“Most of the subcons are probably Chinese as well so they are also cheaper. Add in the logistics costs of sourcing close to the assembly point and the costs implications become quite clear.”
cool – do you have any idea how much this saves Apple per iPod? $25? More?
I once knew a slave. He got free food and a free place to live. He seemed pretty content to me. Apparently we just don’t understand.
Nick- Arghh! SUPPLY CHAIN.
Move the entire supply chain or even half of it to the US and it’s no longer$90 in parts. That and the logistics costs of shipping components/raw mtrls to the US and it’s a whole lot more expensive.
Thanks to the Environmental movement (which i support where it makes sense) we can no longer compete on raw materials.
(I’ve said it before, we even import CEMENT, how stupid is that?)
blah
Boycott the Isweat. Send a message.
-stands and applauds MDN take-
Steev: “I don’t recall Apple ever taking any kind of political position on anything.”
Al Gore is an Apple board member picked by Steve Jobs. Steve Jobs is a huge supporter of the Democratic Party.
——–
“a) It’s not reasonable to hold Apple to a standard that will put them at a competitive disadvantage.”
Apple should hold itself to a higher standard.
Move the factories to Mexico so Mexicans don´t have to leave their country and invade the U.S..
“b) You can’t force a country like China to change overnight, it would throw them into economic AND cultural turmoil.”
Who said it would cause them economic AND cultural turmoil? And maybe that would be better than a dictatorial commie govt. enslaving its people while it gets richer and richer. Instead of paying its people a decent wage, allow freedom of thought and choice, China spends most of its extra money on its military so they can invade Taiwan and threaten its neighbors.
“c) The slow steady path it the best in matters of economic development.”
Depends on which way the path is going.
http://www.chinadaily.com.cn/english/doc/2005-02/22/content_418101.htm
It seems to me that Chinese workers in iPod factories get paid the going rate for production labor. What most people don’t understand is that $1 in China goes a long way. The cost of living is much much lower in Asian countries than in Europe and the US.
According to Google,
1 U.S. dollars = 0.5427703 British pounds
1 U.S. dollars = 0.793335978 Euro
1 U.S. dollars = 8.01577505 Chinese yuan
1 U.S. dollars = 11.3866944 Mexican peso
1 U.S. dollars = 45.8749266 Indian rupee
Outsource Cost savings on an iPod? Only Apple has those numbers. But I’m pretty confident that the margin is on par /slightly better with similar products.
I have traveled and done business in China, and Taiwan. Factories with dormitories are the norm, particularly the smaller ones. Apple is no different than any of the other American companies doing business there. As long as all of you insist on low prices for your tech goods the situation will not change.
Steev and Jack:
You guys seem to know about this topic. Seriously, if you had to give an educated rough guess, how much do you think a “made in the USA” iPod would have to cost for Apple to maintain a reasonable profit? Consider the $299 30GB iPod.
Would you say $349, $399, $499, … ? I’m trying to get this in perspective.
In response to Nick-
I really don’t know. I don’t think it would be $1000 like some prev posts have stated. But honestly, even if the retail cost went up 25% People would scream too expensive. If Apple reduced the margin to compensate, Wallstreet would freak, the stock would dive and Apple would suffer as well. And the “Patriot factor” would not offset the loss of sales due to increased retail cost.
In Response to Hal responding to my 3 points-
A) Move the factories to Mexico so Mexicans don´t have to leave their country and invade the U.S..
• I agree (i used to look for made in Canada/Mexico if not USA). Candy iMacs were assembled by LG in Mexicali. Unfortunately since ≈2001 Mexico cannot compete with Asia/China on labor costs or workforce.
B) Who said it would cause them economic AND cultural turmoil? And maybe that would be better than a dictatorial commie govt. enslaving its people while it gets richer and richer. Instead of paying its people a decent wage, allow freedom of thought and choice, China spends most of its extra money on its military so they can invade Taiwan and threaten its neighbors.
• Again I agree, but must point out that sudden economic changes often result in social upheaval. Couple that with the current general content of the Chinese populace and the impact of economic changes could be dramatic. Besides, China doesn’t just roll over and capitulate to outside influence. Look at their population control, monetary standard, etc.
C) The slow steady path it the best in matters of economic development.”
Depends on which way the path is going.
• I’m willing to bet that the per capita income has dramatically increased over the last 15 to 10 years. Maybe not as fast as folks would like but still faster than most. That should translate into better education, more economic freedom stimulating a positive social shift to more democratic ideologies.
Don’t get me wrong, I hate that China is still a communist country, but it irks me that people think Apple should do something about it. If everyone really gave a damn then people would spend the extra $$ for products not “Assembled in China”. So instead of blaming corporations for doing what the populace pushes them to do (mfg at lowest poss cost) we all better take a good long look in the mirror.
Sorry, I usually don’t go on like this.
oops forgot about Gore,
The Gore thing has me stumped. It seems like a political statement, but I fail to see any benefit to having him on Apple’s board.
He certainly isn’t a spokesperson for Apple. Maybe he’s a consultant on how his invention (the internet) works.
Regarding Jobs being a Demo-
Jobs opinions and political position are his own, and I’d like to see any article where he positions Apple politically.
I can only think of him talking about Apple & the environment, and that was in response to those protesters at Macworld.
Other than that, I doubt you will find any.
Steev:
“But honestly, even if the retail cost went up 25% People would scream too expensive. If Apple reduced the margin to compensate, Wallstreet would freak, the stock would dive and Apple would suffer as well. And the “Patriot factor” would not offset the loss of sales due to increased retail cost.”
I agree, but what do you think about the idea of a special-edition “made in the USA” iPod? Weirdos like me who want to support American jobs could pay extra and get the “made in the USA” iPod with pride. The rest of the more practical people could keep enjoying the low price of the Chinese-made iPod.
Al Gore,
What are you doing? You are spending way too much time trying to save our planet from over heating (as you fly around in your privet jets and drive in your SUVs) and now look at all the jobs we are losing to China!
You are on the board of directors at Apple computer, How can you let Apple do this?????
What is more important the Earth or American Jobs?
WMD
wmd: “What is more important the Earth or American Jobs?”
Answer: The most important thing to Al Gore is Al Gore (running for President again….)
It seems very logical that someone in China earning $54 per month and spending half of their earnings on food and housing would be faring much better than someone living in the United States and working at Walmart. I don’t think the average wage at Walmart after taxes would even cover housing, let alone food.
I’m not going to get rid of my slaves. Why should I be at a competitive disadvantage? Everyone else is doing it, and it’s legal too. And trying to change policy would ruin the economy and the nation. Equal rights is just a bunch of BS. If we can’t get slaves from Africa, we’ll just get them from another country anyway, so why bother trying to legislate it? People wouldn’t pay the higher prices that would result from getting rid of my slaves, so it’s not my fault. They don’t even have it that bad. I know people in the North that can’t even afford food and housing.
Well, those poor people certainly make nice iPods!!!
j/k, good take MDN. But … I think this is probably just political muckraking.
Thorin, iPod’s are assembled by a Taiwanese Company, Foxconn, who has it’s production in the PRC (China), while development is done in the ROC (Taiwan).
It’s same ol’ like we see in the US and Europe.
Seeing all those flaming comments makes me laugh really. There are things to worry about indeed, and it never hurts to keep a close eye, which is why there is an (almost) industry wide committee that checks on sub-conn’s like Foxconn. They keep tabs, do audits and check facilities to avoid sweatshops as mentioned in the header of the article.
Codes of conduct are established with most of the companies we’re talking about. Not Apple, nor Dell wants to get those problems with media in the US.
Nick, it’s not the labor that would up the price on the iPod. It would be the investment in automated machinery because producing the iPod would 100% sure be done by machines, not humans.
Look at the original Mac, Apple was very proud to have it build/assembled completely in the USA, and guess what? Most of it, in 1984/85, was already done by robots/machines.
Comes back to what I said in a previous post, only highly skilled jobs would be needed for that factory.
Why not? Because investment in a factory does not outweigh the cost of labor in China, plus the fact that retooling a automated factory costs more time and money then instruction of people in China to handle and assemble a new product.
Since all of us are flaming Apple for not delivering enough on time after product-launch already, why should Apple take another delaying factor in it’s production.
Guys, start thinking a bit outside the American box, read and think a bit before you start flaming…tsss just a bit of logic thinking, all you need.
MW: George, as in George Washington did a lot of logic thinking while writing the USA constitution.
“MW: George, as in George Washington did a lot of logic thinking while writing the USA constitution.”
Why not? He had 316 slaves to carry out his every whim, and probably screwed half of them.
“MW: George, as in George Washington did a lot of logic thinking while writing the USA constitution.”
“Why not? He had 316 slaves to carry out his every whim…”
———————-
Goes so show how little you listen in school. George did not write the U.S. Constitution. The main writers were Paine, Jefferson and Adams. Others helped directly or indirectly.
Next your going to tell us that George wrote the Declaration of Independence which was all done by Jefferson.
wmd