Foxconn’s difficulty in hiring skilled staff in Wisconsin indicates US’ loss in protracted trade tension

By Wang Jiamei Source:Global Times Published: 2018/11/7 22:08:41

Although Taiwan-based electronics manufacturer Foxconn denied media reports saying it is considering bringing Chinese workers to staff its plant in the US state of Wisconsin, it seems the manufacturer still has trouble recruiting enough skilled workers from the local labor market, as it said it will supplement recruitment from other US locations as required. To a certain extent, this situation highlights the difficulty in bringing manufacturing back to the US.

Last year, Foxconn announced plans to invest $10 billion to build a plant in Wisconsin that may eventually hire 13,000 local workers, and an incentive package of more than $4 billion is to be awarded to Foxconn if it meets hiring, wage and investment targets.

Yet, it turns out that generous subsidies and tax breaks are not a panacea. In August, there were media reports that with Wisconsin's unemployment rate near a record low, Foxconn was finding it difficult to recruit enough staff despite working with universities and technical schools as well as hiring veterans.

It is also doubtful whether Foxconn can really supplement recruitment from other US locations as it claimed, because all of the US, not just Wisconsin, has a shortage of skilled workers. The National Association of Manufacturers has said about 500,000 jobs within the industry are open. However, a severe skills gap has made it increasingly difficult for manufacturing companies to recruit workers. According to a report by the Manufacturing Institute and Deloitte projects, about 2 million manufacturing jobs in the US will go unfilled by 2025 due to the shortage of skilled workers.

While US President Donald Trump has pledged to bring manufacturing jobs back to make America great again, he overlooked the fact that after years of manufacturing job losses, the country is facing a severe skills gap that isn't easy to fill. Without workers who have the necessary education and skills, the return of manufacturing may only underscore the huge number of job openings, but not actual employment.

In comparison, China, after decades of manufacturing development, has accumulated a large base of hard-working and diligent technical workers with relatively low pay levels. Moreover, as Chinese manufacturers are moving up the value chain, they have begun to offer competitive salaries for global talent in some advanced fields. For instance, technology giant Tencent Holdings is reportedly recruiting self-driving car engineers in California.

In short, attracting investment for manufacturing facilities may be easy, but the competition for talent is what determines a country's manufacturing competitiveness. In this sense, the US may appear aggressive in the trade war in the short term, but it's unlikely to maintain the stance in the long run, as a lack of skilled workers will thwart Trump's ambition to bring manufacturing back home.

The author is a reporter with the Global Times.


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