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Move over humans.....here come 1 million robots

The introduction of widespread use of robotics in China could have far-reaching consequences, as The Times [as reproduced in The Australian] reports:

"One million robots will, if everything goes according to plan, be toiling in Foxconn's Chinese factories in three years' time -- a mighty, mechanised army tirelessly snapping together the world's iPhones, Nintendo games consoles, DVD players and Android tablets in a whirring tumult of automation.

It would represent a colossal chunk of capital investment by Foxconn, a 100-fold increase on the company's present robot population of 10,000 and, more significantly, potentially a life-changing moment in the development of China's vast manufacturing economy, an inflection-point where the cheapness and productivity of the Chinese worker no longer makes economic sense.

For decades, the Chinese factory worker has been the fundamental unit on which economic growth has been built. His or her wages, speed and disposability underpinned the "China price" that brought down the cost of goods everywhere, made the country's factories so attractive to foreign outsourcers and hollowed-out manufacturing centres across the globe.

Those dynamics, Foxconn's move suggests, are changing fast. For Luddites, labour leaders and local governments, its ambitions are the stuff of nightmares.

The Taiwanese group that assembles consumer gadgets on behalf of nearly every big technology company you've ever heard of employs more than a million people in mainland China -- and this is not an environment where mass layoffs by a large, solvent company will play well, in Beijing or on the streets of Guangdong province.

Yet this is a company that understands every permutation of margins and productivity, so the chances are high that the financial mathematics of the robot strategy makes good sense.

Most of what goes on in Foxconn is a closely guarded secret, but there are thought to be quite a few jobs on the assembly line that to not involve much more than pushing a button.

In the eastern city of Shenzhen -- where the robots plan reportedly was announced at a dance for workers -- the company staffs the world's biggest factory with 400,000 (human) workers. It is a melting-pot of migrants whose working conditions, salaries, cash remittances and lifestyles are the stuff of relentless scrutiny and analysis.

Where Foxconn goes, runs the theory, so ultimately will the Chinese manufacturing story -- and when the Foxconn factory suffered a spate of suicides last year, the debate quickly shifted into a broad examination of the manufacturing industry and the human price being paid for all that lovely GDP growth.

The conclusion at the time was that the price was still worth it.

Suddenly, as Foxconn has shown, those calculations have begun to change. In an era of systemic CPI inflation, wage inflation, benefits inflation and increasing instances of labour unrest, the ideal worker is no longer a dirt-poor migrant from Guizhou province but a machine that never goes on strike, never demands a wage hike, doesn't ask for a bigger dormitory and is not too picky about the food in the canteen."

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