In a recent address at the New York Economic Club, Apple CEO Tim Cook shed light on the tech giant’s decision to base its manufacturing operations primarily in China. Despite widespread assumptions that Apple and other tech companies are drawn to China for its low labor costs, Cook clarified that the real driving factor is the exceptional skill set available in the country.
“The popular conception is that companies come to China because of low labor costs. The truth is China stopped being a low labor costs country many years ago,” Cook stated. “The reason is because of skill, the quantity of skill in one location and the type of skill it is,” he added.
Cook emphasized that Apple’s products require advanced tooling and state-of-the-art materials, which demand a high level of precision. He pointed out that while the U.S. has a limited number of tooling engineers, China boasts an abundance of such skilled professionals. “You could accommodate many football fields” with the number of skilled tooling engineers in China, Cook noted.
Elon Musk, CEO of Tesla, supported Cook’s remarks with a simple “True” on social media, further amplifying the discussion.
The video of Cook’s speech, which has garnered 6 million views, sparked a variety of reactions online. One user remarked, “It started as cheap labor, then they became highly skilled and invested in manufacturing infrastructure, meanwhile we forgot how to build at scale and became reliant on them to do anything. Then they raised the costs of labor and now we have no other option.”
Some criticized Cook’s comments, with one user highlighting the troubling issue of worker suicides at Apple’s Chinese factories and the installation of suicide prevention nets.
Another user reflected on Cook’s statement, saying, “That’s a kind way of saying ‘China has more skilled labor per capita than the US or any other place on earth’.”
The debate underscores the ongoing challenge for U.S. companies and policymakers to balance the need for advanced manufacturing skills with domestic production capabilities.