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Competing in the global economy

Views: 4369

... - Apr 16, 2007 by

... - Apr 17, 2007 by Dirk Nuendyke  

... - Apr 17, 2007 by Dirk Nuendyke  

Machine Designer


Competing in the global economy | 16 April, 2007

Sorry to change the subject, but you might find this interesting as it does affect all manner of economics and the ability to compete in the new global marketplace.

Engineers like me who have kids to put through school will find this especially interesting.

The above link will take you to a 5 minute streaming presentation that covers all manner of surprising facts the concensus of which is that things are changing globally and although we need to adapt now, it's probably too late.

I'd be curious to hear your comments!

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Competing in the global economy | 17 April, 2007

Very thought provoking - thanks for the link. I feel kind of sorry for the next generation.



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Competing in the global economy | 17 April, 2007

Oh no! Doom and gloom on the horizon! Why should I even try?

Gawd, I've heard this sh@t all my life and ya know what? I went to school, got good grades, worked my ass off, landed a decent job, and still work for a low IQ, non-Chinese, non-Indian butt. High IQs mean nothing in the real word. Ever been outside your little circle and attend a business association? Most business owners are not high IQ people. They are regular people that didn�t want to follow others, just fit into the grove and grind out a living. Too bad 90% of the world is like this. Even so, say India and China have more 10%ers and they all fly over here to the states and start businesses. That just makes the US a little stronger, provide economy, and opens the door for the 10%ers to look for more global opportunity.

Things like this are propaganda designed to spread fear and agony to others. Misery likes company. Go ahead and throw your hands in the air and give up. You really want to, and just need someone to agree with you so you can justify it. Continue to follow the heard aimlessly, work in crap and only see ass holes. Yes, the entire world is out to get you, we just haven�t mustered enough high IQ people to cage you in yet.

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Competing in the global economy | 17 April, 2007


Competing in the global economy | 17 April, 2007

Hi there CK,

I didn't follow the link yet, but I thought I'd comment on your post here. I've attended two engineering schools in the USA, and one of them was a pretty darn good school. At both, I would have to say about 80%+ of the graduate students were foreign. Now, I don't have the actual facts and figures, that was just my observation. I may be way off, but I don't think I am.

Also, I'd like to mention that about 80% of my professors were foreign (Indian, or Chinese)... So while we may have some awful good schools here, we're being taught by people from what you called turd-world countries.

Most American students don't want to go any further than a 4-year degree. I don't blame them. Who wants to keep scraping by when you can go out and get a real job, a nice car and a house right out of college? Not to mention we just can't afford it anymore. I'm working full time at a "real" job as an SMT process guy and machine programmer, and trying to dump as much as I can into my 401k, and I'm finding it hard to pay for my part-time schooling.

I think we do have an education problem in this country, the cost of schooling is skyrocketing and it's just going to become more difficult for students to make the sacrifice.

That is all.

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Competing in the global economy | 17 April, 2007

Machine Designer


Competing in the global economy | 18 April, 2007

The point is that shift is all about adapting not doom and gloom. BTW: Thanks for the flame and insulting words Brett. Way to hijack a thread that merely pointed to some interesting facts that could create some interesting dialog. I was merely inviting people to view those facts and draw their own conclusions about adaptation.

Someone with less of a personal axe to grind sent me this addendum:

China has the fourth largest economy in the world, and the nation's red hot economy has been growing even faster than analysts predicted. For the fifth straight quarter the Chinese economy has grown more than 10 percent - with no signs of slowing down.

Made In China

Recently the World Trade Organization released its first batch of global trade statistics for 2006. According to the WTO, China has surpassed the United States as the world's second-largest exporter. Furthermore, at current growth rates, China is projected to overtake Germany as the world�s biggest exporter in 2008. Since 2000, China has more than doubled its share in world merchandise exports.

Meanwhile, the US trade imbalance with China grew to $232.5 billion, the highest ever with a single country. The United States has accused the Chinese of benefiting from an undervalued currency, illegal government subsidies, unfair barriers to foreign competition and widespread piracy. The United States filed two new complaints against China at the WTO on Tuesday over copyright policy and restrictions on the sale of American goods.

Record-Breaking Reserves

In November of last year, China's foreign currency reserves passed the 1 trillion dollar mark - setting a new record for the world's largest currency reserves and sparking a debate over China's economic policies. China's currency reserves have been growing at a rate of nearly 30 million dollars per hour. In just the first three months of 2007, China's foreign currency reserves have surged even higher, to over $1.2 trillion dollars.

Experts estimate that over 70 percent of China's record-breaking currency reserves are US dollars. However the Chinese Central Bank has announced plans to diversify their currency reserves. Besides China, other countries, such as Iran, Switzerland, and Russia have also announced that they plan to move reserves away from the dollar. At present, approximately two thirds of world trade is conducted in dollars and two thirds of central banks' currency reserves are held in the American currency which remains the sole currency used by international institutions such as the International Monetary Fund. This confers on the US a major economic advantage: the ability to run a trade deficit year after year. If more banks move away from the dollar it could cripple the US economy.

A New Era

In recent years China has transformed itself from an isolated communist nation into a growing superpower. If the 20th century was the American century, then the 21st century will undoubtedly be the Asian century.

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Competing in the global economy | 19 April, 2007

A few more facts:

1) China has between 100-160 cities with populations of over 1 million. America has 9 and all of Europe has 36.

2) China will produce 325,000 engineers this year....5 times as many as the United States. 40% of all American students who enter US universities on the engineering track change their mind.

3) Mentioned somewhat in the America there are only 50,000 students learning Chinese as a second language. In China there are as many people learning English as a second language as there are people who speak English as a first language in the United States, Canada and Great Britain COMBINED!

4) Brazil is the 15th largest economy in the world. If China took all of the dollars they have in reserve and decided to spend them, they could buy in one DAY what Brazil buys in one YEAR with those dollars.

It's why I always the best case scenario the US becomes Great the worst case China will destroy us.

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Competing in the global economy | 19 April, 2007


That's surely a risk worth taking!

On a more serious note, China has a population approximately 5 times that of the USA, and it is still in the growth phase of it's industrial revolution so naturally they will need a higher proportion of engineers. Remember China is growing and modernising at an incredible pace so the engineers aren't just there for export goods, but also for infrastructure and for satisfying their own internal market which is growing exponentially year on year.

There are lots of things that we can do to compete with emerging economies such as smarter buying of kit (second user, or just the right kit for the job), more or better directed investment, and intellegent management. It's not all doom & gloom.

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Competing in the global economy | 19 April, 2007

I am part of the intern and Coop program here at work and see a trend of students doing just the opposite of getting a degree and going off to work for cash.

We are seeing students taking up dual majors...1 in eng and 1 in Business. They understand industry today and are looking for an advantage...includes multiple languages.

we are seeing pshyc majors taking jobs in industry to understand customers and cultures better.

old school ways of thinking are out the window

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Competing in the global economy | 19 April, 2007

Cool! Leave it to kids to think outside the box. But why does it have to be a box? (I love asking that in interviews). Anyway, I'm glad it's not the end of the world.... yet.

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Competing in the global economy | 19 April, 2007

Fastek, where'd you get your statistic on #2? If you could, please send a link.


PS-I took out my 2 other posts because they were deragatory toward countries and schools.

We don't want this forum to be a flame war like this:

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Competing in the global economy | 20 April, 2007

You're a very bad man!

Everyone knows that the first rule of SMT Net is:

Don't mention the stencil cleaners!

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Machine Designer


Competing in the global economy | 20 April, 2007

I'm not a protectionist (yet), but I can surely know a trend in my industry when I see one.

In the past 10 years we were looking to outsource precision machined goods to Asia. Although the quality wasn't there, the cost incentives made up for it even with the problems we were having. Now a few years later we find ourselves outsourcing precision macnining not because of price but because it's hard to find machine shops with capacity that can do precision tooling in production quntities.

When I talk to these domestic shop owners they all say the same thing. While CNC machining is as cost competitive as ever; the best tool and die makers are retiring and there is no second generation kids to take the place.

The emergency apprenticeship programs implemented in the 80's to recruit new machinists failed because the process to train a new machinist is long and costly. Very few trainees can wait it out. Also I commonly hear that the next generation doesn't have the skills, education or patience to learn non-CNC and more labor intensive techniques such as finishing, grinding, honing and polishing.

Yet now the work we get out of Singapore and Thailand and Malaysia are as good now as the work we used to be able find back in the 80's. The reasons? Because these shops were painstakingly trained by American companies who needed support for the semiconductor and disk drive markets that were exported wholesale in the 80's.

Now that those industries have moved to China, these shops are specializing in other more lucrative work including the once uniquely American elite jobs of machining for things like aerospace components and precision assemblies.

I'm worried that the talents that we once took for granted are getting harder and harder to find without reaching out overseas. On that same note however it's interesting that China has yet to master those skills and although they can do specialized work such as mold making, stamping dies and the like their are very few precision toolmakers at this point. Like anything though, I suppose they will acquire those skills too in the not too distant future.

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Competing in the global economy | 20 April, 2007

MD, I totally agree with you

A couple of years ago we had an ISO auditor in our company who was QC manager at Lockheed Martin. At lunch break we were discussing the erosion of American manufacturing and the effects outsourcing had on our economy. He told me that the vast majority of spare parts for our fighter jets (mechanical and electrical) were made in China.

This was very chocking to me can you imagine what could happen if China gets ticked off at the USA? Dollar stores closed and fighter jets grounded.

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Competing in the global economy | 20 April, 2007

Dollar stores? really? Maybe we should bow down to the Chineese and give up.

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Competing in the global economy | 20 April, 2007

CK, you are a bad man for bringing that up, but I have to admit that I also enjoy that thread!

Speaking of threads, we had some dialog in the past on this very topic:

I guess this whole China thing strikes a nerve with us "ufortunate ones" who still do this type of work. After all, we do this work to feed our families and put our kids through college.

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Competing in the global economy | 21 April, 2007

Remember the good old days when we would boycott the Olympics in Russia because they were the "Commy bad guys"?

Now that China is hosting, are we going to boycott now? We are too weak to do something like that now.

I certainly wish we would.

Plus, I would be too scared to sit in any stadiums for fear that they would collapse again.

I would love an all-out boycott from China (and other places) and pull everything back to the States.

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Machine Designer


Competing in the global economy | 27 April, 2007

The trade imballance isn't even being talked about in Washington. But still I can't see why on a global scale only China can compete when it comes to making goods.

Speaking of Washington cleaning house in congress sounds like good idea but truthfully we'd just get more of the same.

On a brighter note I'm thinking that the latest trend in composites area good trend in aerospace. We still have the technical advantage in the US and Boeings new dreamliner is a step in the right direction. Now maybe soon we'll see composite aircraft or two in the military.

We should all be thankful that DFAR regulations prohibit the outsourcing mission critical hardware and items condsidered sensitive. The Barry amendment is still in place to make sure that either US and enemy neutral (note I didn't say allies) countries provide us the raw materials for those parts.

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