Plenty of people have already chimed in about whether Google Glass, the high-tech mobile camera, video, and computing device welded to a pair of glasses, is an innovative work of staggering genius or, well, kinda dorky-looking, but we’re struck by something else entirely: Google’s decision to produce the device in Silicon Valley, USA. The FT reports:
The small scale, high cost and complexity of the project’s initial run makes it practical to base manufacturing operations near the search company’s Silicon Valley headquarters, according to people briefed on the plans….Manufacturing locally will allow Google’s engineers to be closely involved with the production process and provide more opportunities for last-minute fixes and for personal customisation….Such moves may also blaze a trail for Silicon Valley’s resurgent community of hardware start-ups, which remain largely reliant on cheaper offshore manufacturing. As contract device makers scale up production for large clients such as Apple and Google, their prices will fall and provide capacity for smaller companies too.
Two trends are converging here. The first is the insourcing of manufacturing back to US shores. The growth of the middle class in countries like China raises labor costs there, while automation makes US-based labor costs less burdensome. American factories boast higher quality control, a simpler supply chain for bringing products to market, and access to plentiful supplies of cheap natural gas. Second, infotech sector firms are increasingly aligning behind the interests of the nation states they call home. Google increasingly behaves as if a close relationship with a strong US government is a vital component of its business model. Amazon is developing a cloud-computing network for the CIA.
These are significant changes, but at the same time we shouldn’t expect this new era of American manufacturing to replicate the mass employment of the old days. Santa Clara isn’t going to be the new Detroit.
The future of manufacturing seems to lie in high value-added, sophisticated, and highly productive jobs. This will be great for those who have such jobs, and it will be good for the economy overall, but it will not recreate the Fordist middle class of old.[Google Glass image courtesy of Wikimedia.]