By Michael Chabon
The world is so big, so complicated, so replete with marvels and surprises that it takes years for most people to begin to notice that it is, also, irretrievably broken. We call this period of research “childhood.”
There follows a program of renewed inquiry, often involuntary, into the nature and effects of mortality, entropy, heartbreak, violence, failure, cowardice, duplicity, cruelty, and grief; the researcher learns their histories, and their bitter lessons, by heart. Along the way, he or she discovers that the world has been broken for as long as anyone can remember, and struggles to reconcile this fact with the ache of cosmic nostalgia that arises, from time to time, in the researcher’s heart: an intimation of vanished glory, of lost wholeness, a memory of the world unbroken. We call the moment at which this ache first arises “adolescence.” The feeling haunts people all their lives.
Everyone, sooner or later, gets a thorough schooling in brokenness. The question becomes: What to do with the pieces? Some people hunker down atop the local pile of ruins and make do, Bedouin tending their goats in the shade of shattered giants. Others set about breaking what remains of the world into bits ever smaller and more jagged, kicking through the rubble like kids running through piles of leaves. And some people, passing among the scattered pieces of that great overturned jigsaw puzzle, start to pick up a piece here, a piece there, with a vague yet irresistible notion that perhaps something might be done about putting the thing back together again.
Two difficulties with this latter scheme at once present themselves. First of all, we have only ever glimpsed, as if through half-closed lids, the picture on the lid of the jigsaw puzzle box. Second, no matter how diligent we have been about picking up pieces along the way, we will never have anywhere near enough of them to finish the job. The most we can hope to accomplish with our handful of salvaged bits—the bittersweet harvest of observation and experience—is to build a little world of our own. A scale model of that mysterious original, unbroken, half—remembered. Of course the worlds we build out of our store of fragments can be only approximations, partial and inaccurate. As representations of the vanished whole that haunts us, they must be accounted failures. And yet in that very failure, in their gaps and inaccuracies, they may yet be faithful maps, accurate scale models, of this beautiful and broken world. We call these scale models “works of art.”
From Rushmore to Moonrise Kingdom (shamefully neglected by this year’s Academy voters), Wes Anderson’s films readily, even eagerly, concede the “miniature” quality of the worlds he builds, in their set design and camera-work, in their use of stop-motion, maps, and models. And yet these miniatures span continents and decades. They comprise crime, adultery, brutality, suicide, the death of a parent, the drowning of a child, moments of profound joy and transcendence.
Vladimir Nabokov, his life cleaved by exile, created a miniature version of the homeland he would never see again and tucked it, with a jeweler’s precision, into the housing of John Shade’s miniature epic of family sorrow. Anderson—who has suggested that the breakup of his parents’ marriage was a defining experience of his life—adopts a Nabokovian procedure with the families or quasi families at the heart of all his films, from Rushmore forward, creating a series of scale-model households that, like the Zemblas and Estotilands and other lost “kingdoms by the sea” in Nabokov, intensify our experience of brokenness and loss by compressing them. That is the paradoxical power of the scale model; a child holding a globe has a more direct, more intuitive grasp of the earth’s scope and variety, of its local vastness and its cosmic tininess, than a man who spends a year in circumnavigation.
Grief, at full scale, is too big for us to take it in; it literally cannot be comprehended. Anderson, like Nabokov, understands that distance can increase our understanding of grief, allowing us to see it whole. But distance does not—ought not—necessarily imply a withdrawal. In order to gain sufficient perspective on the pain of exile and the murder of his father, Nabokov did not, in writing Pale Fire, step back from them. He reduced their scale, and let his patience, his precision, his mastery of detail—detail, the god of the model-maker—do the rest. With each of his films, Anderson’s total command of detail—both the physical detail of his sets and costumes, and the emotional detail of the uniformly beautiful performances he elicits from his actors—has enabled him to increase the persuasiveness of his own family Zemblas, without sacrificing any of the paradoxical emotional power that distance affords.
Anderson’s films have frequently been compared to the boxed assemblages of Joseph Cornell, and it’s a useful comparison, as long as one bears in mind that the crucial element, in a Cornell box, is neither the imagery and objects it deploys, nor the Romantic narratives it incorporates and undermines, nor the playfulness and precision with which its objects and narratives have been arranged. The important thing, in a Cornell box, is the box.
Cornell always took pains to construct his boxes himself; indeed the box is the only part of a Cornell work literally “made” by the artist. The box, to Cornell, is a gesture—it draws a boundary around the things it contains, and forces them into a defined relationship, not merely with one another, but with everything outside the box. The box sets out the scale of a ratio; it mediates the halves of a metaphor. It makes explicit, in plain, handcrafted wood and glass, the yearning of a model-maker to analogize the world, and at the same time it frankly emphasizes the limitations, the confines, of his or her ability to do so.
The things in Anderson’s films that recall Cornell’s boxes—the strict, steady, four-square construction of individual shots, by which the cinematic frame becomes a Cornellian gesture, a box drawn around the world of the film, as in Moonrise Kingdom’s dressing room scene, with the little bird-girls framed by strips of light bulbs; the teeming, gridded, curio cabinet sets at the heart of The Life Aquatic, The Darjeeling Limited, and Fantastic Mr. Fox—are often cited as evidence of his work’s “artificiality,” at times with the implication, simple-minded and profoundly mistaken, that a high degree of artifice is somehow inimical to seriousness, to honest emotion, to so-called authenticity. All movies, of course, are equally artificial; it’s just that some are more honest about it than others. In this important sense, the hand-built, model-kit artifice on display behind the pane of an Anderson box is a guarantor of authenticity; indeed I would argue that artifice, openly expressed, is the only true “authenticity” an artist can lay claim to.
Anderson’s films, like the boxes of Cornell or the novels of Nabokov, understand and demonstrate that the magic of art, which renders beauty out of brokenness, disappointment, failure, decay, even ugliness and violence—is authentic only to the degree that it attempts to conceal neither the bleak facts nor the tricks employed in pulling off the presto change-o. It is honest only to the degree that it builds its precise and inescapable box around its maker’s x:y scale version of the world.
“For my next trick,” says Joseph Cornell, or Vladimir Nabokov, or Wes Anderson, “I have put the world into a box.” And when he opens the box, you see something dark and glittering, an orderly mess of shards, refuse, bits of junk and feather and butterfly wing, tokens and totems of memory, maps of exile, documentation of loss. And you say, leaning in, “The world!”
January 31, 2013, 4:03 p.m.
http://www.nybooks.com/blogs/nyrblog/2013/jan/31/wes-anderson-worlds/
Monday, February 4, 2013
Friday, December 7, 2012
Saturday, September 8, 2012
Film Is Dead? Long Live Movies
By MANOHLA DARGIS and A. O. SCOTT
New York Times – September 6, 2012
IN the beginning there was light that hit a strip of flexible film mechanically running through a camera. For most of movie history this is how moving pictures were created: light reflected off people and things would filter through a camera and physically transform emulsion. After processing, that light-kissed emulsion would reveal Humphrey Bogart chasing the Maltese Falcon in shimmering black and white.
More and more, though, movies are either partly or entirely digital constructions that are created with computers and eventually retrieved from drives at your local multiplex or streamed to the large and small screens of your choice. Right before our eyes, motion pictures are undergoing a revolution that may have more far reaching, fundamental impact than the introduction of sound, color or television. Whether these changes are scarcely visible or overwhelmingly obvious, digital technology is transforming how we look at movies and whatmovies look like, from modestly budgeted movies shot with digital still cameras to blockbusters laden with computer-generated imagery. The chief film (and digital cinema) critics of The New York Times, Manohla Dargis and A. O. Scott, look at the stuff dreams are increasingly made of.
A. O. SCOTT In Jean-Luc Godard’s 1986 movie “Keep Up Your Right” a movie director (played by Mr. Godard) declares that “the toughest thing in movies is carrying the cans.” Those once-ubiquitous, now increasingly quaint metal boxes contained the reels of exposed celluloid stock that were the physical substance of the art form. But nowadays the easiest thing in digital movies might be carrying the hard drive or uploading the data onto the server. Those heavy, bulky canisters belong to the mechanical past, along with the whir of the projectors and the shudder of the sprockets locking into their holes.
Should we mourn, celebrate or shrug? Predigital artifacts — typewriters and record players, maybe also books and newspapers — are often beautiful, but their charm will not save them from obsolescence. And the new gizmos have their own appeal, to artists as well as consumers. Leading manufacturers are phasing out the production of 35-millimeter cameras. Within the next few years digital projection will reign not only at the multiplexes, but at revival and art houses too. According to an emerging conventional wisdom, film is over. If that is the case, can directors still be called filmmakers? Or will that title be reserved for a few holdouts, like Paul Thomas Anderson, whose new film, “The Master,” was shot in 70 millimeter? It’s not as if our job has ever been to review the coils of celluloid nestled in their cans; we write about the stories and the pictures recorded on that stock. But the shift from photochemical to digital is not simply technical or semantic. Something very big is going on.
MANOHLA DARGIS Film isn’t dead yet, despite the rush to bury it, particularly by the big studios. Film does not have to disappear. Film isn’t broken — it works wonderfully well and has done so for a century. There is nothing inevitable or natural about the end of film, no matter how seductive the digital technologies and gadgets that are transforming cinema. A 16-millimeter film camera is plenty cool. A 35-millimeter film image can look sublime. There’s an underexamined technological determinism that shapes discussions about the end of film and obscures that the material is being phased out not because digital is superior, but because this transition suits the bottom line.
The end of film isn’t a just a technological imperative; it’s also about economics (including digital rights management). In 2002 seven major studios formed the Digital Cinema Initiatives (one later dropped out), the purpose of which was “to establish and document voluntary specifications for an open architecture for digital cinema that ensures a uniform and high level of technical performance, reliability and quality control.” What these initiatives effectively did was outline the technological parameters that everyone who wants to do business with the studios — from software developers to hardware manufacturers — must follow. As the theorist David Bordwell writes, “Theaters’ conversion from 35-millemeter film to digital presentation was designed by and for an industry that deals in mass output, saturation releases and quick turnover.” He adds, “Given this shock-and-awe business plan, movies on film stock look wasteful.”
SCOTT Let me play devil’s advocate, though I hope that doesn’t make me an advocate for the corporate interests of the Hollywood studios. If there is a top-down capitalist imperative governing the shift to digital exhibition in theaters, there is at the same time a bottom-up tendency driving the emergence of digital filmmaking.
Throughout history artists have used whatever tools served their purposes and have adapted new technologies to their own creative ends. The history of painting, as the art critic James Elkins suggests in his book “What Painting Is,” is in part a history of the changing chemical composition of paint. It does not take a determinist to point out that artistic innovations in cinema often have a technological component. It takes nothing away from the genius of Gregg Toland, the cinematographer on “Citizen Kane,” to note that the astonishing deep-focus compositions in that film were made possible by new lenses. And the arrival of relatively lightweight, shoulder-mounted cameras in the late 1950s made it possible for cinéma vérité documentarians and New Wave auteurs to capture the immediacy of life on the fly.
Long before digital seemed like a viable delivery system for theatrical exhibition, it was an alluring paintbox for adventurous and impecunious cinéastes. To name just one: Anthony Dod Mantle, who shot many of the Dogma 95 movies and Danny Boyle’s zombie shocker “28 Days Later,” found poetry in the limitations of the medium. In the right hands, its smeary, blurry colors could be haunting, and the smaller, lighter cameras could produce a mood of queasy, jolting intimacy.
Image quality improved rapidly, and the last decade has seen some striking examples of filmmakers exploring and exploiting digital to aesthetic advantage. The single 90-minute Steadicam shot through the Hermitage Museum that makes up Alexander Sokurov’s “Russian Ark” is a specifically digital artifact. So is the Los Angeles nightscape in Michael Mann’s“Collateral” and the rugged guerrilla battlefield of Steven Soderbergh’s “Che,” a movie that would not exist without the light, mobile and relatively inexpensive Red camera.
Digital special effects, meanwhile, are turning up this season not only in phantasmagorical places like “Cloud Atlas” and “Life of Pi,” but also in movies that emphasize naturalism. To my eyes the most amazing bit of digital magic this year is probably the removal of Marion Cotillard’s legs — including in scenes in which she wears a bathing suit or nothing at all — in Jacques Audiard’s gritty “Rust and Bone.” While movie artists of various stripes gravitate toward the speed, portability and cheapness of digital, which offers lower processing and equipment costs and less cumbersome editing procedures, consumers, for their part, are suckers for convenience, sometimes — but not always — at the expense of quality.
I love the grain and luster of film, which has a range of colors and tones as yet unmatched by digital. There is nothing better than seeing a clean print projected on a big screen, with good sound and a strong enough bulb in the projector. But reality has rarely lived up to that ideal. I spent my cinephile adolescence watching classic movies on spliced, scratched, faded prints with blown-out soundtracks, or else on VHS — and also not seeing lots of stuff that bypassed the local repertory house or video store. I’d rather look at a high-quality digital transfers available on TCM or from the Criterion Collection, and more recently (very recently) at a revival theater like Film Forum in New York. Like anyone else of a certain age I have fond memories of the way things used to be, but I also think that in many respects the way things are is better.
DARGIS We’re not talking about the disappearance of one material — oil, watercolor, acrylic or gouache — we’re talking about deep ontological and phenomenological shifts that are transforming a medium. You can create a picture with oil paint or watercolor. For most of their history, by contrast, movies were only made from photographic film strips (originally celluloid) that mechanically ran through a camera, were chemically processed and made into film prints that were projected in theaters in front of audiences solely at the discretion of the distributors (and exhibitors). With cameras and projectors the flexible filmstrip was one foundation of modern cinema: it is part of what turned photograph images into moving photographic images. Over the past decade digital technologies have changed how movies are produced, distributed and consumed; the end of film stock is just one part of a much larger transformation.
I’m not antidigital, even if I prefer film: I love grain and the visual texture of film, and even not-too-battered film prints can be preferable to digital. Yes, digital can look amazing if the director — Mr. Soderbergh, Mr. Mann, Mr. Godard, David Fincher and David Lynch come to mind — and the projectionist have a clue. (I’ve seen plenty of glitches with digital projection, like the image freezing or pixelating.) I hate the unknowingly ugly visual quality of many digital movies, including those that try to mimic the look of film. We’re awash in ugly digital because of cost cutting and a steep learning curve made steeper by rapidly changing technologies. (The rapidity of those changes is one reason film, which is very stable, has become the preferred medium for archiving movies shot both on film and in digital.)
We’re seeing too many movies that look thin, smeared, pixelated or too sharply outlined and don’t have the luxurious density of film and often the color. I am sick of gray and putty skin tones. The effects of digital cinema can also be seen in the ubiquity of hand-held camerawork that’s at least partly a function of the equipment’s relative portability. Meanwhile digital postproduction and editing have led to a measurable increase in the number of dissolves. Dissolves used to be made inside the camera or with an optical printer, but today all you need is editing software and a click of the mouse. This is changing the integrity of the shot, and it’s also changing montage, which, in Eisenstein’s language, is a collision of shots. Much remains the same in how directors narrate stories (unfortunately!), yet these are major changes.
SCOTT I agree that digital has introduced new visual clichés and new ways for movies to look crummy. But there have always been a lot of dumb, bad-looking movies, and it’s a given that most filmmakers (like most musicians, artists, writers and humans in whatever line of work) will use emerging technologies to perpetuate mediocrity. A few, however, will discover fresh aesthetic possibilities and point the way forward for a young art form.
An interesting philosophical question is whether, or to what extent, it will be the same art form. Will digitally made and distributed moving-picture narratives diverge so radically from what we know as “films” that we no longer recognize a genetic relationship? Will the new digital cinema absorb its precursor entirely, or will they continue to coexist? As dramatic as this revolution has been, we are nonetheless still very much in the early stages.
DARGIS The history of cinema is also a history of technological innovations and stylistic variations. New equipment and narrative techniques are introduced that can transform the ways movies look and sound and can inspire further changes. Does taking film out of the moving image change what movies are? We don’t know. And it may be that the greater shift — in terms of what movies were and what they are — may have started in 1938, when Paramount Pictures invested in a pioneering television firm. By the late 1950s Americans were used to watching Hollywood movies on their TVs. They were already hooked on a convenience that — as decades of lousy-looking home video confirmed — has consistently mattered more to them than an image’s size or any of its other properties.
From there it’s just a technological hop, skip and jump to watching movies on an iPad. That’s convenient, certainly, but isn’t the same as going to a movie palace to watch, as an audience, a luminous, larger-than-life work that was made by human hands. To an extent we are asking the same question we’ve been asking since movies began: What is cinema? “The photograph is literally an emanation of the referent,” the philosopher Roland Barthes wrote. “From a real body, which was there, proceed radiations which ultimately touch me, who am here.” A film image is created by light that leaves a material trace of something that exists — existed — in real time and space. It’s in this sense that film becomes a witness to our existence.
Then again, I learned from the great avant-garde artist Ken Jacobs — who projects moving images that he creates with shutters, lenses, shadows and his hands — that cinema doesn’t have to be film; it has to be magic.
Sunday, May 27, 2012
Loud Boos Don't Faze Carlos Reygadas
May 27, 2012 - NY Times - Dennis Lim
CANNES, France — At 40, Carlos Reygadas is firmly established as the leading enfant terrible of Mexican cinema and a favored son of the Cannes Film Festival. All four of his features, starting with his 2002 debut, “Japón,” have been shown here; on his previous trip, in 2007, he won the Jury Prize (the equivalent of third place) for the Dreyer-inspired “Silent Light.” An impressionistic home movie of sorts, albeit on a cosmic scale, Mr. Reygadas’s fourth feature, “Post Tenebras Lux,” which had its premiere here this week, concerns a well-off couple (Adolfo Jimenez Castro and Nathalia Acevedo) who live in the Mexican countryside with their two children (played by Mr. Reygadas’s children, Rut and Eleazar). Mr. Reygadas’s taste for the awe and terror of the sublime is in evidence again, as is his confrontational streak — there is candid sex and (off-screen) animal cruelty, as well as a luminescent red devil with visible genitalia. But the biggest provocations in the film are its aesthetic and narrative liberties. Shot with distorting lenses and edited with little regard for chronology or traditional signposts, “Post Tenebras Lux” (the Latin title means “After Darkness, Light”) resembles a documentary at times and a dream at others. It can be hard to tell if certain incongruous sequences — a house party, a rugby match, an orgy at a sauna — are taking place in the past, the future or someone’s imagination. There were belligerent boos and hooting at the press screening on Wednesday evening. In an interview on the terrace of the Grand Hotel the next afternoon, Mr. Reygadas, who does not lack for opinions or self-assurance (he spoke candidly of fellow filmmakers here, like Sergei Loznitsa, Ulrich Seidl, Darezhan Omirbayev and Leos Carax), was more than willing to defend his movie and take on its detractors. Edited excerpts from the conversation follow:Cannes has been good to you and important for your career. But based on the reactions last night, do you wonder if this is really the best environment for an adventurous filmmaker?
Not in the short term, but it is in the long run, as long as there’s exposure and as long as some people like the film. People asked me today how can you have the [nerve] to do something like that, and I said, I know that if I like it, there will be some other people who like it. In the time of the Greeks, Seneca said, the better a piece of art, the more rejection it will receive in its moment — that’s a social law. I don’t know why people are so worried, like some of my distributors. I tell them don’t worry, who cares? This is positive; you should be honored.
Did you expect such hostile reactions? “Post Tenebras Lux” actually seems much gentler than some of your earlier films.
Yeah, totally. Friends in Mexico who saw it didn’t think it would be so divisive. You know, people here are tired, they’re paid to judge, and they think they have to judge before they feel. The other day someone asked me whose films I’m looking forward to. And I said I care about Loznitsa [in competition with “In the Fog”], Seidl [“Paradise: Love”] and Omirbayev [whose film “Student” is in the Un Certain Regard section]. One thing that annoys me: why is a man like Omirbayev not in competition? It’s not good for cinema. I understand there have to be films with stars. But how many films are there in competition this year about cinema, by people trying to make cinema? Kiarostami, Seidl, Carax, probably four or five or six.
To get back to “Post Tenebras Lux” let’s talk a bit about the film’s distinctive look. It’s shot in the boxy 1:33 aspect radio and, in many scenes, with a lens that creates a halo-like effect, with a sharp focus at the center of the image and a blurred circle on the edges.
Why did I want that look? Because aesthetics are in the end are a reinterpretation of the world. Why did you use this effect only for exterior scenes? It was intuitive. I feel that somehow we experience the senses more outdoors. The outside world is where impressionism started. I was also thinking of glass that was made before the 1950s, where they pretended to make it perfect but the machines weren’t. It’s a little bit curved and creates little reflections, so you look through a window and you actually feel the glass — things look different — and there’s a reinterpretation of reality. The landscape where I was shooting is very particular. I did “Silent Light” in CinemaScope because those were very flat, huge landscapes, and here it’s surrounded by very steep mountains. I also wanted the sense of everything being totally centered in a square format — it’s like things are more respected if they’re composed that way.
This seems in many ways a deeply personal film: your children are in it; it was edited by your wife, Natalia López; and it was shot mostly in a location you know well.
It’s the village where I live, about 80 kilometers south of Mexico City in the state of Morelos. It’s a very personal film in the source, in where it comes from,, and the place and many of the things that happen are dear and close to me. But the values of the people in the film are not mine. I don’t share the way they see life or treat people or relate to each other. The film was built up during a period of couple of years when I was building my house in the countryside, where the weather is rough, with the sun, the dust, the cold. At the same time I was walking a lot in the mountains with my children and my dogs, which you also see in the film, and I just wanted to share that. Some scenes — like in the sauna where the wife has sex with other people — are there because it’s also about desire. The film is about fantasy, but probably that scene is reality, who knows? I wanted to show that these people, while frustrated to a certain extent, are also capable of sometimes trespassing certain limits, which makes them a little more special than people who don’t. Perhaps the refusal to distinguish between fantasy and reality is what bothers some people about the film. There’s no code — that was the idea from the beginning. I’ve always thought that intelligent viewers don’t need to be led and will follow eventually. Something I find really strange is that the people who saw the film here last night went to school, read books, and I say this not because I’m comparing myself — but think of “The Metamorphosis” by Kafka, which was written almost a hundred years ago. Nobody knows if he really transforms into an insect or not, and there’s no explanation, and if there was an explanation, I’m sure we wouldn’t be reading that book anymore. Why is it that when people read it — or read Joyce, and again, I’m not saying that I’m like Joyce — but why can they read and accept these books, but why do they need explanations when they’re watching films?
I don’t want to press you for explanations, but can you talk about the personal significance of some of the more enigmatic passages, for instance the scenes of English schoolboys playing rugby? I know you went to school in England.
I went for a year and a half, and I liked rugby very much, I loved its physicality. The film is not a postmodernist, relativist thing. Things can be clearly explained. It’s a film about Juan, who lives, who imagines, who remembers, and probably we see bits of his life. He could have been on a rugby team when he was young. But the rugby scene is also there at the end to mean that life goes on, we keep on playing and we need to play, disregarding the fact that it’s raining blood in Mexico and heads are being torn off. Rugby’s a good fit for the film: the physicality of it matches the violence of the land, of nature, of life, but at the same time there’s love. I love what this English boy says at the end, which could be a statement against bankers: they’re strong, they’re terrible, but we are a team and we will not let them destroy us, so carry on, let’s go. It’s a rebellious film in that sense.
Sunday, January 22, 2012
How U.S. Lost Out on iPhone Work
New York Times – January 21, 2012
By CHARLES DUHIGG and KEITH BRADSHER
When Barack Obama joined Silicon Valley’s top luminaries for dinner in California last February, each guest was asked to come with a question for the president.
But as Steven P. Jobs of Apple spoke, President Obama interrupted with an inquiry of his own: what would it take to make iPhones in the United States?
Not long ago, Apple boasted that its products were made in America. Today, few are. Almost all of the 70 million iPhones, 30 million iPads and 59 million other products Apple sold last year were manufactured overseas.
Why can’t that work come home? Mr. Obama asked.
Mr. Jobs’s reply was unambiguous. “Those jobs aren’t coming back,” he said, according to another dinner guest.
The president’s question touched upon a central conviction at Apple. It isn’t just that workers are cheaper abroad. Rather, Apple’s executives believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have so outpaced their American counterparts that “Made in the U.S.A.” is no longer a viable option for most Apple products.
Apple has become one of the best-known, most admired and most imitated companies on earth, in part through an unrelenting mastery of global operations. Last year, it earned over $400,000 in profit per employee, more than Goldman Sachs, Exxon Mobil or Google.
However, what has vexed Mr. Obama as well as economists and policy makers is that Apple — and many of its high-technology peers — are not nearly as avid in creating American jobs as other famous companies were in their heydays.
Apple employs 43,000 people in the United States and 20,000 overseas, a small fraction of the over 400,000 American workers at General Motors in the 1950s, or the hundreds of thousands at General Electric in the 1980s. Many more people work for Apple’s contractors: an additional 700,000 people engineer, build and assemble iPads, iPhones and Apple’s other products. But almost none of them work in the United States. Instead, they work for foreign companies in Asia, Europe and elsewhere, at factories that almost all electronics designers rely upon to build their wares.
“Apple’s an example of why it’s so hard to create middle-class jobs in the U.S. now,” said Jared Bernstein, who until last year was an economic adviser to the White House.
“If it’s the pinnacle of capitalism, we should be worried.”
Apple executives say that going overseas, at this point, is their only option. One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.
A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.
“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.”
Similar stories could be told about almost any electronics company — and outsourcing has also become common in hundreds of industries, including accounting, legal services, banking, auto manufacturing and pharmaceuticals.
But while Apple is far from alone, it offers a window into why the success of some prominent companies has not translated into large numbers of domestic jobs. What’s more, the company’s decisions pose broader questions about what corporate America owes Americans as the global and national economies are increasingly intertwined.
“Companies once felt an obligation to support American workers, even when it wasn’t the best financial choice,” said Betsey Stevenson, the chief economist at the Labor Department until last September. “That’s disappeared. Profits and efficiency have trumped generosity.”
Companies and other economists say that notion is naïve. Though Americans are among the most educated workers in the world, the nation has stopped training enough people in the mid-level skills that factories need, executives say.
To thrive, companies argue they need to move work where it can generate enough profits to keep paying for innovation. Doing otherwise risks losing even more American jobs over time, as evidenced by the legions of once-proud domestic manufacturers — including G.M. and others — that have shrunk as nimble competitors have emerged.
Apple was provided with extensive summaries of The New York Times’s reporting for this article, but the company, which has a reputation for secrecy, declined to comment.
This article is based on interviews with more than three dozen current and former Apple employees and contractors — many of whom requested anonymity to protect their jobs — as well as economists, manufacturing experts, international trade specialists, technology analysts, academic researchers, employees at Apple’s suppliers, competitors and corporate partners, and government officials.
Privately, Apple executives say the world is now such a changed place that it is a mistake to measure a company’s contribution simply by tallying its employees — though they note that Apple employs more workers in the United States than ever before.
They say Apple’s success has benefited the economy by empowering entrepreneurs and creating jobs at companies like cellular providers and businesses shipping Apple products. And, ultimately, they say curing unemployment is not their job.
“We sell iPhones in over a hundred countries,” a current Apple executive said. “We don’t have an obligation to solve America’s problems. Our only obligation is making the best product possible.”
‘I Want a Glass Screen’
In 2007, a little over a month before the iPhone was scheduled to appear in stores, Mr. Jobs beckoned a handful of lieutenants into an office. For weeks, he had been carrying a prototype of the device in his pocket.
Mr. Jobs angrily held up his iPhone, angling it so everyone could see the dozens of tiny scratches marring its plastic screen, according to someone who attended the meeting. He then pulled his keys from his jeans.
People will carry this phone in their pocket, he said. People also carry their keys in their pocket. “I won’t sell a product that gets scratched,” he said tensely. The only solution was using unscratchable glass instead. “I want a glass screen, and I want it perfect in six weeks.”
After one executive left that meeting, he booked a flight to Shenzhen, China. If Mr. Jobs wanted perfect, there was nowhere else to go.
For over two years, the company had been working on a project — code-named Purple 2 — that presented the same questions at every turn: how do you completely reimagine the cellphone? And how do you design it at the highest quality — with an unscratchable screen, for instance — while also ensuring that millions can be manufactured quickly and inexpensively enough to earn a significant profit?
The answers, almost every time, were found outside the United States. Though components differ between versions, all iPhones contain hundreds of parts, an estimated 90 percent of which are manufactured abroad. Advanced semiconductors have come from Germany and Taiwan, memory from Korea and Japan, display panels and circuitry from Korea and Taiwan, chipsets from Europe and rare metals from Africa and Asia. And all of it is put together in China.
In its early days, Apple usually didn’t look beyond its own backyard for manufacturing solutions. A few years after Apple began building the Macintosh in 1983, for instance, Mr. Jobs bragged that it was “a machine that is made in America.” In 1990, while Mr. Jobs was running NeXT, which was eventually bought by Apple, the executive told a reporter that “I’m as proud of the factory as I am of the computer.” As late as 2002, top Apple executives occasionally drove two hours northeast of their headquarters to visit the company’s iMac plant in Elk Grove, Calif.
But by 2004, Apple had largely turned to foreign manufacturing. Guiding that decision was Apple’s operations expert, Timothy D. Cook, who replaced Mr. Jobs as chief executive last August, six weeks before Mr. Jobs’s death. Most other American electronics companies had already gone abroad, and Apple, which at the time was struggling, felt it had to grasp every advantage.
In part, Asia was attractive because the semiskilled workers there were cheaper. But that wasn’t driving Apple. For technology companies, the cost of labor is minimal compared with the expense of buying parts and managing supply chains that bring together components and services from hundreds of companies.
For Mr. Cook, the focus on Asia “came down to two things,” said one former high-ranking Apple executive. Factories in Asia “can scale up and down faster” and “Asian supply chains have surpassed what’s in the U.S.” The result is that “we can’t compete at this point,” the executive said.
The impact of such advantages became obvious as soon as Mr. Jobs demanded glass screens in 2007.
For years, cellphone makers had avoided using glass because it required precision in cutting and grinding that was extremely difficult to achieve. Apple had already selected an American company, Corning Inc., to manufacture large panes of strengthened glass. But figuring out how to cut those panes into millions of iPhone screens required finding an empty cutting plant, hundreds of pieces of glass to use in experiments and an army of midlevel engineers. It would cost a fortune simply to prepare.
Then a bid for the work arrived from a Chinese factory.
When an Apple team visited, the Chinese plant’s owners were already constructing a new wing. “This is in case you give us the contract,” the manager said, according to a former Apple executive. The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day.
The Chinese plant got the job.
“The entire supply chain is in China now,” said another former high-ranking Apple executive. “You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.”
In Foxconn City
An eight-hour drive from that glass factory is a complex, known informally as Foxconn City, where the iPhone is assembled. To Apple executives, Foxconn City was further evidence that China could deliver workers — and diligence — that outpaced their American counterparts.
That’s because nothing like Foxconn City exists in the United States.
The facility has 230,000 employees, many working six days a week, often spending up to 12 hours a day at the plant. Over a quarter of Foxconn’s work force lives in company barracks and many workers earn less than $17 a day. When one Apple executive arrived during a shift change, his car was stuck in a river of employees streaming past. “The scale is unimaginable,” he said.
Foxconn employs nearly 300 guards to direct foot traffic so workers are not crushed in doorway bottlenecks. The facility’s central kitchen cooks an average of three tons of pork and 13 tons of rice a day. While factories are spotless, the air inside nearby teahouses is hazy with the smoke and stench of cigarettes.
Foxconn Technology has dozens of facilities in Asia and Eastern Europe, and in Mexico and Brazil, and it assembles an estimated 40 percent of the world’s consumer electronics for customers like Amazon, Dell, Hewlett-Packard, Motorola, Nintendo, Nokia, Samsung and Sony.
“They could hire 3,000 people overnight,” said Jennifer Rigoni, who was Apple’s worldwide supply demand manager until 2010, but declined to discuss specifics of her work. “What U.S. plant can find 3,000 people overnight and convince them to live in dorms?”
In mid-2007, after a month of experimentation, Apple’s engineers finally perfected a method for cutting strengthened glass so it could be used in the iPhone’s screen. The first truckloads of cut glass arrived at Foxconn City in the dead of night, according to the former Apple executive. That’s when managers woke thousands of workers, who crawled into their uniforms — white and black shirts for men, red for women — and quickly lined up to assemble, by hand, the phones. Within three months, Apple had sold one million iPhones. Since then, Foxconn has assembled over 200 million more.
Foxconn, in statements, declined to speak about specific clients.
“Any worker recruited by our firm is covered by a clear contract outlining terms and conditions and by Chinese government law that protects their rights,” the company wrote. Foxconn “takes our responsibility to our employees very seriously and we work hard to give our more than one million employees a safe and positive environment.”
The company disputed some details of the former Apple executive’s account, and wrote that a midnight shift, such as the one described, was impossible “because we have strict regulations regarding the working hours of our employees based on their designated shifts, and every employee has computerized timecards that would bar them from working at any facility at a time outside of their approved shift.” The company said that all shifts began at either 7 a.m. or 7 p.m., and that employees receive at least 12 hours’ notice of any schedule changes.
Foxconn employees, in interviews, have challenged those assertions.
Another critical advantage for Apple was that China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States.
In China, it took 15 days.
Companies like Apple “say the challenge in setting up U.S. plants is finding a technical work force,” said Martin Schmidt, associate provost at the Massachusetts Institute of Technology. In particular, companies say they need engineers with more than high school, but not necessarily a bachelor’s degree. Americans at that skill level are hard to find, executives contend. “They’re good jobs, but the country doesn’t have enough to feed the demand,” Mr. Schmidt said.
Some aspects of the iPhone are uniquely American. The device’s software, for instance, and its innovative marketing campaigns were largely created in the United States. Apple recently built a $500 million data center in North Carolina. Crucial semiconductors inside the iPhone 4 and 4S are manufactured in an Austin, Tex., factory by Samsung, of South Korea.
But even those facilities are not enormous sources of jobs. Apple’s North Carolina center, for instance, has only 100 full-time employees. The Samsung plant has an estimated 2,400 workers.
“If you scale up from selling one million phones to 30 million phones, you don’t really need more programmers,” said Jean-Louis Gassée, who oversaw product development and marketing for Apple until he left in 1990. “All these new companies — Facebook, Google, Twitter — benefit from this. They grow, but they don’t really need to hire much.”
It is hard to estimate how much more it would cost to build iPhones in the United States. However, various academics and manufacturing analysts estimate that because labor is such a small part of technology manufacturing, paying American wages would add up to $65 to each iPhone’s expense. Since Apple’s profits are often hundreds of dollars per phone, building domestically, in theory, would still give the company a healthy reward.
But such calculations are, in many respects, meaningless because building the iPhone in the United States would demand much more than hiring Americans — it would require transforming the national and global economies. Apple executives believe there simply aren’t enough American workers with the skills the company needs or factories with sufficient speed and flexibility. Other companies that work with Apple, like Corning, also say they must go abroad.
Manufacturing glass for the iPhone revived a Corning factory in Kentucky, and today, much of the glass in iPhones is still made there. After the iPhone became a success, Corning received a flood of orders from other companies hoping to imitate Apple’s designs. Its strengthened glass sales have grown to more than $700 million a year, and it has hired or continued employing about 1,000 Americans to support the emerging market.
But as that market has expanded, the bulk of Corning’s strengthened glass manufacturing has occurred at plants in Japan and Taiwan.
“Our customers are in Taiwan, Korea, Japan and China,” said James B. Flaws, Corning’s vice chairman and chief financial officer. “We could make the glass here, and then ship it by boat, but that takes 35 days. Or, we could ship it by air, but that’s 10 times as expensive. So we build our glass factories next door to assembly factories, and those are overseas.”
Corning was founded in America 161 years ago and its headquarters are still in upstate New York. Theoretically, the company could manufacture all its glass domestically. But it would “require a total overhaul in how the industry is structured,” Mr. Flaws said. “The consumer electronics business has become an Asian business. As an American, I worry about that, but there’s nothing I can do to stop it. Asia has become what the U.S. was for the last 40 years.”
Middle-Class Jobs Fade
The first time Eric Saragoza stepped into Apple’s manufacturing plant in Elk Grove, Calif., he felt as if he were entering an engineering wonderland.
It was 1995, and the facility near Sacramento employed more than 1,500 workers. It was a kaleidoscope of robotic arms, conveyor belts ferrying circuit boards and, eventually, candy-colored iMacs in various stages of assembly. Mr. Saragoza, an engineer, quickly moved up the plant’s ranks and joined an elite diagnostic team. His salary climbed to $50,000. He and his wife had three children. They bought a home with a pool.
“It felt like, finally, school was paying off,” he said. “I knew the world needed people who can build things.”
At the same time, however, the electronics industry was changing, and Apple — with products that were declining in popularity — was struggling to remake itself. One focus was improving manufacturing. A few years after Mr. Saragoza started his job, his bosses explained how the California plant stacked up against overseas factories: the cost, excluding the materials, of building a $1,500 computer in Elk Grove was $22 a machine. In Singapore, it was $6. In Taiwan, $4.85. Wages weren’t the major reason for the disparities. Rather it was costs like inventory and how long it took workers to finish a task.
“We were told we would have to do 12-hour days, and come in on Saturdays,” Mr. Saragoza said. “I had a family. I wanted to see my kids play soccer.”
Modernization has always caused some kinds of jobs to change or disappear. As the American economy transitioned from agriculture to manufacturing and then to other industries, farmers became steelworkers, and then salesmen and middle managers. These shifts have carried many economic benefits, and in general, with each progression, even unskilled workers received better wages and greater chances at upward mobility.
But in the last two decades, something more fundamental has changed, economists say. Midwage jobs started disappearing. Particularly among Americans without college degrees, today’s new jobs are disproportionately in service occupations — at restaurants or call centers, or as hospital attendants or temporary workers — that offer fewer opportunities for reaching the middle class.
Even Mr. Saragoza, with his college degree, was vulnerable to these trends. First, some of Elk Grove’s routine tasks were sent overseas. Mr. Saragoza didn’t mind. Then the robotics that made Apple a futuristic playground allowed executives to replace workers with machines. Some diagnostic engineering went to Singapore. Middle managers who oversaw the plant’s inventory were laid off because, suddenly, a few people with Internet connections were all that were needed.
Mr. Saragoza was too expensive for an unskilled position. He was also insufficiently credentialed for upper management. He was called into a small office in 2002 after a night shift, laid off and then escorted from the plant. He taught high school for a while, and then tried a return to technology. But Apple, which had helped anoint the region as “Silicon Valley North,” had by then converted much of the Elk Grove plant into an AppleCare call center, where new employees often earn $12 an hour.
There were employment prospects in Silicon Valley, but none of them panned out. “What they really want are 30-year-olds without children,” said Mr. Saragoza, who today is 48, and whose family now includes five of his own.
After a few months of looking for work, he started feeling desperate. Even teaching jobs had dried up. So he took a position with an electronics temp agency that had been hired by Apple to check returned iPhones and iPads before they were sent back to customers. Every day, Mr. Saragoza would drive to the building where he had once worked as an engineer, and for $10 an hour with no benefits, wipe thousands of glass screens and test audio ports by plugging in headphones.
Paydays for Apple
As Apple’s overseas operations and sales have expanded, its top employees have thrived. Last fiscal year, Apple’s revenue topped $108 billion, a sum larger than the combined state budgets of Michigan, New Jersey and Massachusetts. Since 2005, when the company’s stock split, share prices have risen from about $45 to more than $427.
Some of that wealth has gone to shareholders. Apple is among the most widely held stocks, and the rising share price has benefited millions of individual investors, 401(k)’s and pension plans. The bounty has also enriched Apple workers. Last fiscal year, in addition to their salaries, Apple’s employees and directors received stock worth $2 billion and exercised or vested stock and options worth an added $1.4 billion.
The biggest rewards, however, have often gone to Apple’s top employees. Mr. Cook, Apple’s chief, last year received stock grants — which vest over a 10-year period — that, at today’s share price, would be worth $427 million, and his salary was raised to $1.4 million. In 2010, Mr. Cook’s compensation package was valued at $59 million, according to Apple’s security filings.
A person close to Apple argued that the compensation received by Apple’s employees was fair, in part because the company had brought so much value to the nation and world. As the company has grown, it has expanded its domestic work force, including manufacturing jobs. Last year, Apple’s American work force grew by 8,000 people.
While other companies have sent call centers abroad, Apple has kept its centers in the United States. One source estimated that sales of Apple’s products have caused other companies to hire tens of thousands of Americans. FedEx and United Parcel Service, for instance, both say they have created American jobs because of the volume of Apple’s shipments, though neither would provide specific figures without permission from Apple, which the company declined to provide.
“We shouldn’t be criticized for using Chinese workers,” a current Apple executive said. “The U.S. has stopped producing people with the skills we need.”
What’s more, Apple sources say the company has created plenty of good American jobs inside its retail stores and among entrepreneurs selling iPhone and iPad applications.
After two months of testing iPads, Mr. Saragoza quit. The pay was so low that he was better off, he figured, spending those hours applying for other jobs. On a recent October evening, while Mr. Saragoza sat at his MacBook and submitted another round of résumés online, halfway around the world a woman arrived at her office. The worker, Lina Lin, is a project manager in Shenzhen, China, at PCH International, which contracts with Apple and other electronics companies to coordinate production of accessories, like the cases that protect the iPad’s glass screens. She is not an Apple employee. But Mrs. Lin is integral to Apple’s ability to deliver its products.
Mrs. Lin earns a bit less than what Mr. Saragoza was paid by Apple. She speaks fluent English, learned from watching television and in a Chinese university. She and her husband put a quarter of their salaries in the bank every month. They live in a 1,080-square-foot apartment, which they share with their in-laws and son.
“There are lots of jobs,” Mrs. Lin said. “Especially in Shenzhen.”
Innovation’s Losers
Toward the end of Mr. Obama’s dinner last year with Mr. Jobs and other Silicon Valley executives, as everyone stood to leave, a crowd of photo seekers formed around the president. A slightly smaller scrum gathered around Mr. Jobs. Rumors had spread that his illness had worsened, and some hoped for a photograph with him, perhaps for the last time.
Eventually, the orbits of the men overlapped. “I’m not worried about the country’s long-term future,” Mr. Jobs told Mr. Obama, according to one observer. “This country is insanely great. What I’m worried about is that we don’t talk enough about solutions.”
At dinner, for instance, the executives had suggested that the government should reform visa programs to help companies hire foreign engineers. Some had urged the president to give companies a “tax holiday” so they could bring back overseas profits which, they argued, would be used to create work. Mr. Jobs even suggested it might be possible, someday, to locate some of Apple’s skilled manufacturing in the United States if the government helped train more American engineers.
Economists debate the usefulness of those and other efforts, and note that a struggling economy is sometimes transformed by unexpected developments. The last time analysts wrung their hands about prolonged American unemployment, for instance, in the early 1980s, the Internet hardly existed. Few at the time would have guessed that a degree in graphic design was rapidly becoming a smart bet, while studying telephone repair a dead end.
What remains unknown, however, is whether the United States will be able to leverage tomorrow’s innovations into millions of jobs.
In the last decade, technological leaps in solar and wind energy, semiconductor fabrication and display technologies have created thousands of jobs. But while many of those industries started in America, much of the employment has occurred abroad. Companies have closed major facilities in the United States to reopen in China. By way of explanation, executives say they are competing with Apple for shareholders. If they cannot rival Apple’s growth and profit margins, they won’t survive.
“New middle-class jobs will eventually emerge,” said Lawrence Katz, a Harvard economist. “But will someone in his 40s have the skills for them? Or will he be bypassed for a new graduate and never find his way back into the middle class?”
The pace of innovation, say executives from a variety of industries, has been quickened by businessmen like Mr. Jobs. G.M. went as long as half a decade between major automobile redesigns. Apple, by comparison, has released five iPhones in four years, doubling the devices’ speed and memory while dropping the price that some consumers pay.
Before Mr. Obama and Mr. Jobs said goodbye, the Apple executive pulled an iPhone from his pocket to show off a new application — a driving game — with incredibly detailed graphics. The device reflected the soft glow of the room’s lights. The other executives, whose combined worth exceeded $69 billion, jostled for position to glance over his shoulder. The game, everyone agreed, was wonderful.
There wasn’t even a tiny scratch on the screen.
David Barboza, Peter Lattman and Catherine Rampell contributed reporting.
By CHARLES DUHIGG and KEITH BRADSHER
When Barack Obama joined Silicon Valley’s top luminaries for dinner in California last February, each guest was asked to come with a question for the president.
But as Steven P. Jobs of Apple spoke, President Obama interrupted with an inquiry of his own: what would it take to make iPhones in the United States?
Not long ago, Apple boasted that its products were made in America. Today, few are. Almost all of the 70 million iPhones, 30 million iPads and 59 million other products Apple sold last year were manufactured overseas.
Why can’t that work come home? Mr. Obama asked.
Mr. Jobs’s reply was unambiguous. “Those jobs aren’t coming back,” he said, according to another dinner guest.
The president’s question touched upon a central conviction at Apple. It isn’t just that workers are cheaper abroad. Rather, Apple’s executives believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have so outpaced their American counterparts that “Made in the U.S.A.” is no longer a viable option for most Apple products.
Apple has become one of the best-known, most admired and most imitated companies on earth, in part through an unrelenting mastery of global operations. Last year, it earned over $400,000 in profit per employee, more than Goldman Sachs, Exxon Mobil or Google.
However, what has vexed Mr. Obama as well as economists and policy makers is that Apple — and many of its high-technology peers — are not nearly as avid in creating American jobs as other famous companies were in their heydays.
Apple employs 43,000 people in the United States and 20,000 overseas, a small fraction of the over 400,000 American workers at General Motors in the 1950s, or the hundreds of thousands at General Electric in the 1980s. Many more people work for Apple’s contractors: an additional 700,000 people engineer, build and assemble iPads, iPhones and Apple’s other products. But almost none of them work in the United States. Instead, they work for foreign companies in Asia, Europe and elsewhere, at factories that almost all electronics designers rely upon to build their wares.
“Apple’s an example of why it’s so hard to create middle-class jobs in the U.S. now,” said Jared Bernstein, who until last year was an economic adviser to the White House.
“If it’s the pinnacle of capitalism, we should be worried.”
Apple executives say that going overseas, at this point, is their only option. One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.
A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.
“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.”
Similar stories could be told about almost any electronics company — and outsourcing has also become common in hundreds of industries, including accounting, legal services, banking, auto manufacturing and pharmaceuticals.
But while Apple is far from alone, it offers a window into why the success of some prominent companies has not translated into large numbers of domestic jobs. What’s more, the company’s decisions pose broader questions about what corporate America owes Americans as the global and national economies are increasingly intertwined.
“Companies once felt an obligation to support American workers, even when it wasn’t the best financial choice,” said Betsey Stevenson, the chief economist at the Labor Department until last September. “That’s disappeared. Profits and efficiency have trumped generosity.”
Companies and other economists say that notion is naïve. Though Americans are among the most educated workers in the world, the nation has stopped training enough people in the mid-level skills that factories need, executives say.
To thrive, companies argue they need to move work where it can generate enough profits to keep paying for innovation. Doing otherwise risks losing even more American jobs over time, as evidenced by the legions of once-proud domestic manufacturers — including G.M. and others — that have shrunk as nimble competitors have emerged.
Apple was provided with extensive summaries of The New York Times’s reporting for this article, but the company, which has a reputation for secrecy, declined to comment.
This article is based on interviews with more than three dozen current and former Apple employees and contractors — many of whom requested anonymity to protect their jobs — as well as economists, manufacturing experts, international trade specialists, technology analysts, academic researchers, employees at Apple’s suppliers, competitors and corporate partners, and government officials.
Privately, Apple executives say the world is now such a changed place that it is a mistake to measure a company’s contribution simply by tallying its employees — though they note that Apple employs more workers in the United States than ever before.
They say Apple’s success has benefited the economy by empowering entrepreneurs and creating jobs at companies like cellular providers and businesses shipping Apple products. And, ultimately, they say curing unemployment is not their job.
“We sell iPhones in over a hundred countries,” a current Apple executive said. “We don’t have an obligation to solve America’s problems. Our only obligation is making the best product possible.”
‘I Want a Glass Screen’
In 2007, a little over a month before the iPhone was scheduled to appear in stores, Mr. Jobs beckoned a handful of lieutenants into an office. For weeks, he had been carrying a prototype of the device in his pocket.
Mr. Jobs angrily held up his iPhone, angling it so everyone could see the dozens of tiny scratches marring its plastic screen, according to someone who attended the meeting. He then pulled his keys from his jeans.
People will carry this phone in their pocket, he said. People also carry their keys in their pocket. “I won’t sell a product that gets scratched,” he said tensely. The only solution was using unscratchable glass instead. “I want a glass screen, and I want it perfect in six weeks.”
After one executive left that meeting, he booked a flight to Shenzhen, China. If Mr. Jobs wanted perfect, there was nowhere else to go.
For over two years, the company had been working on a project — code-named Purple 2 — that presented the same questions at every turn: how do you completely reimagine the cellphone? And how do you design it at the highest quality — with an unscratchable screen, for instance — while also ensuring that millions can be manufactured quickly and inexpensively enough to earn a significant profit?
The answers, almost every time, were found outside the United States. Though components differ between versions, all iPhones contain hundreds of parts, an estimated 90 percent of which are manufactured abroad. Advanced semiconductors have come from Germany and Taiwan, memory from Korea and Japan, display panels and circuitry from Korea and Taiwan, chipsets from Europe and rare metals from Africa and Asia. And all of it is put together in China.
In its early days, Apple usually didn’t look beyond its own backyard for manufacturing solutions. A few years after Apple began building the Macintosh in 1983, for instance, Mr. Jobs bragged that it was “a machine that is made in America.” In 1990, while Mr. Jobs was running NeXT, which was eventually bought by Apple, the executive told a reporter that “I’m as proud of the factory as I am of the computer.” As late as 2002, top Apple executives occasionally drove two hours northeast of their headquarters to visit the company’s iMac plant in Elk Grove, Calif.
But by 2004, Apple had largely turned to foreign manufacturing. Guiding that decision was Apple’s operations expert, Timothy D. Cook, who replaced Mr. Jobs as chief executive last August, six weeks before Mr. Jobs’s death. Most other American electronics companies had already gone abroad, and Apple, which at the time was struggling, felt it had to grasp every advantage.
In part, Asia was attractive because the semiskilled workers there were cheaper. But that wasn’t driving Apple. For technology companies, the cost of labor is minimal compared with the expense of buying parts and managing supply chains that bring together components and services from hundreds of companies.
For Mr. Cook, the focus on Asia “came down to two things,” said one former high-ranking Apple executive. Factories in Asia “can scale up and down faster” and “Asian supply chains have surpassed what’s in the U.S.” The result is that “we can’t compete at this point,” the executive said.
The impact of such advantages became obvious as soon as Mr. Jobs demanded glass screens in 2007.
For years, cellphone makers had avoided using glass because it required precision in cutting and grinding that was extremely difficult to achieve. Apple had already selected an American company, Corning Inc., to manufacture large panes of strengthened glass. But figuring out how to cut those panes into millions of iPhone screens required finding an empty cutting plant, hundreds of pieces of glass to use in experiments and an army of midlevel engineers. It would cost a fortune simply to prepare.
Then a bid for the work arrived from a Chinese factory.
When an Apple team visited, the Chinese plant’s owners were already constructing a new wing. “This is in case you give us the contract,” the manager said, according to a former Apple executive. The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day.
The Chinese plant got the job.
“The entire supply chain is in China now,” said another former high-ranking Apple executive. “You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.”
In Foxconn City
An eight-hour drive from that glass factory is a complex, known informally as Foxconn City, where the iPhone is assembled. To Apple executives, Foxconn City was further evidence that China could deliver workers — and diligence — that outpaced their American counterparts.
That’s because nothing like Foxconn City exists in the United States.
The facility has 230,000 employees, many working six days a week, often spending up to 12 hours a day at the plant. Over a quarter of Foxconn’s work force lives in company barracks and many workers earn less than $17 a day. When one Apple executive arrived during a shift change, his car was stuck in a river of employees streaming past. “The scale is unimaginable,” he said.
Foxconn employs nearly 300 guards to direct foot traffic so workers are not crushed in doorway bottlenecks. The facility’s central kitchen cooks an average of three tons of pork and 13 tons of rice a day. While factories are spotless, the air inside nearby teahouses is hazy with the smoke and stench of cigarettes.
Foxconn Technology has dozens of facilities in Asia and Eastern Europe, and in Mexico and Brazil, and it assembles an estimated 40 percent of the world’s consumer electronics for customers like Amazon, Dell, Hewlett-Packard, Motorola, Nintendo, Nokia, Samsung and Sony.
“They could hire 3,000 people overnight,” said Jennifer Rigoni, who was Apple’s worldwide supply demand manager until 2010, but declined to discuss specifics of her work. “What U.S. plant can find 3,000 people overnight and convince them to live in dorms?”
In mid-2007, after a month of experimentation, Apple’s engineers finally perfected a method for cutting strengthened glass so it could be used in the iPhone’s screen. The first truckloads of cut glass arrived at Foxconn City in the dead of night, according to the former Apple executive. That’s when managers woke thousands of workers, who crawled into their uniforms — white and black shirts for men, red for women — and quickly lined up to assemble, by hand, the phones. Within three months, Apple had sold one million iPhones. Since then, Foxconn has assembled over 200 million more.
Foxconn, in statements, declined to speak about specific clients.
“Any worker recruited by our firm is covered by a clear contract outlining terms and conditions and by Chinese government law that protects their rights,” the company wrote. Foxconn “takes our responsibility to our employees very seriously and we work hard to give our more than one million employees a safe and positive environment.”
The company disputed some details of the former Apple executive’s account, and wrote that a midnight shift, such as the one described, was impossible “because we have strict regulations regarding the working hours of our employees based on their designated shifts, and every employee has computerized timecards that would bar them from working at any facility at a time outside of their approved shift.” The company said that all shifts began at either 7 a.m. or 7 p.m., and that employees receive at least 12 hours’ notice of any schedule changes.
Foxconn employees, in interviews, have challenged those assertions.
Another critical advantage for Apple was that China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States.
In China, it took 15 days.
Companies like Apple “say the challenge in setting up U.S. plants is finding a technical work force,” said Martin Schmidt, associate provost at the Massachusetts Institute of Technology. In particular, companies say they need engineers with more than high school, but not necessarily a bachelor’s degree. Americans at that skill level are hard to find, executives contend. “They’re good jobs, but the country doesn’t have enough to feed the demand,” Mr. Schmidt said.
Some aspects of the iPhone are uniquely American. The device’s software, for instance, and its innovative marketing campaigns were largely created in the United States. Apple recently built a $500 million data center in North Carolina. Crucial semiconductors inside the iPhone 4 and 4S are manufactured in an Austin, Tex., factory by Samsung, of South Korea.
But even those facilities are not enormous sources of jobs. Apple’s North Carolina center, for instance, has only 100 full-time employees. The Samsung plant has an estimated 2,400 workers.
“If you scale up from selling one million phones to 30 million phones, you don’t really need more programmers,” said Jean-Louis Gassée, who oversaw product development and marketing for Apple until he left in 1990. “All these new companies — Facebook, Google, Twitter — benefit from this. They grow, but they don’t really need to hire much.”
It is hard to estimate how much more it would cost to build iPhones in the United States. However, various academics and manufacturing analysts estimate that because labor is such a small part of technology manufacturing, paying American wages would add up to $65 to each iPhone’s expense. Since Apple’s profits are often hundreds of dollars per phone, building domestically, in theory, would still give the company a healthy reward.
But such calculations are, in many respects, meaningless because building the iPhone in the United States would demand much more than hiring Americans — it would require transforming the national and global economies. Apple executives believe there simply aren’t enough American workers with the skills the company needs or factories with sufficient speed and flexibility. Other companies that work with Apple, like Corning, also say they must go abroad.
Manufacturing glass for the iPhone revived a Corning factory in Kentucky, and today, much of the glass in iPhones is still made there. After the iPhone became a success, Corning received a flood of orders from other companies hoping to imitate Apple’s designs. Its strengthened glass sales have grown to more than $700 million a year, and it has hired or continued employing about 1,000 Americans to support the emerging market.
But as that market has expanded, the bulk of Corning’s strengthened glass manufacturing has occurred at plants in Japan and Taiwan.
“Our customers are in Taiwan, Korea, Japan and China,” said James B. Flaws, Corning’s vice chairman and chief financial officer. “We could make the glass here, and then ship it by boat, but that takes 35 days. Or, we could ship it by air, but that’s 10 times as expensive. So we build our glass factories next door to assembly factories, and those are overseas.”
Corning was founded in America 161 years ago and its headquarters are still in upstate New York. Theoretically, the company could manufacture all its glass domestically. But it would “require a total overhaul in how the industry is structured,” Mr. Flaws said. “The consumer electronics business has become an Asian business. As an American, I worry about that, but there’s nothing I can do to stop it. Asia has become what the U.S. was for the last 40 years.”
Middle-Class Jobs Fade
The first time Eric Saragoza stepped into Apple’s manufacturing plant in Elk Grove, Calif., he felt as if he were entering an engineering wonderland.
It was 1995, and the facility near Sacramento employed more than 1,500 workers. It was a kaleidoscope of robotic arms, conveyor belts ferrying circuit boards and, eventually, candy-colored iMacs in various stages of assembly. Mr. Saragoza, an engineer, quickly moved up the plant’s ranks and joined an elite diagnostic team. His salary climbed to $50,000. He and his wife had three children. They bought a home with a pool.
“It felt like, finally, school was paying off,” he said. “I knew the world needed people who can build things.”
At the same time, however, the electronics industry was changing, and Apple — with products that were declining in popularity — was struggling to remake itself. One focus was improving manufacturing. A few years after Mr. Saragoza started his job, his bosses explained how the California plant stacked up against overseas factories: the cost, excluding the materials, of building a $1,500 computer in Elk Grove was $22 a machine. In Singapore, it was $6. In Taiwan, $4.85. Wages weren’t the major reason for the disparities. Rather it was costs like inventory and how long it took workers to finish a task.
“We were told we would have to do 12-hour days, and come in on Saturdays,” Mr. Saragoza said. “I had a family. I wanted to see my kids play soccer.”
Modernization has always caused some kinds of jobs to change or disappear. As the American economy transitioned from agriculture to manufacturing and then to other industries, farmers became steelworkers, and then salesmen and middle managers. These shifts have carried many economic benefits, and in general, with each progression, even unskilled workers received better wages and greater chances at upward mobility.
But in the last two decades, something more fundamental has changed, economists say. Midwage jobs started disappearing. Particularly among Americans without college degrees, today’s new jobs are disproportionately in service occupations — at restaurants or call centers, or as hospital attendants or temporary workers — that offer fewer opportunities for reaching the middle class.
Even Mr. Saragoza, with his college degree, was vulnerable to these trends. First, some of Elk Grove’s routine tasks were sent overseas. Mr. Saragoza didn’t mind. Then the robotics that made Apple a futuristic playground allowed executives to replace workers with machines. Some diagnostic engineering went to Singapore. Middle managers who oversaw the plant’s inventory were laid off because, suddenly, a few people with Internet connections were all that were needed.
Mr. Saragoza was too expensive for an unskilled position. He was also insufficiently credentialed for upper management. He was called into a small office in 2002 after a night shift, laid off and then escorted from the plant. He taught high school for a while, and then tried a return to technology. But Apple, which had helped anoint the region as “Silicon Valley North,” had by then converted much of the Elk Grove plant into an AppleCare call center, where new employees often earn $12 an hour.
There were employment prospects in Silicon Valley, but none of them panned out. “What they really want are 30-year-olds without children,” said Mr. Saragoza, who today is 48, and whose family now includes five of his own.
After a few months of looking for work, he started feeling desperate. Even teaching jobs had dried up. So he took a position with an electronics temp agency that had been hired by Apple to check returned iPhones and iPads before they were sent back to customers. Every day, Mr. Saragoza would drive to the building where he had once worked as an engineer, and for $10 an hour with no benefits, wipe thousands of glass screens and test audio ports by plugging in headphones.
Paydays for Apple
As Apple’s overseas operations and sales have expanded, its top employees have thrived. Last fiscal year, Apple’s revenue topped $108 billion, a sum larger than the combined state budgets of Michigan, New Jersey and Massachusetts. Since 2005, when the company’s stock split, share prices have risen from about $45 to more than $427.
Some of that wealth has gone to shareholders. Apple is among the most widely held stocks, and the rising share price has benefited millions of individual investors, 401(k)’s and pension plans. The bounty has also enriched Apple workers. Last fiscal year, in addition to their salaries, Apple’s employees and directors received stock worth $2 billion and exercised or vested stock and options worth an added $1.4 billion.
The biggest rewards, however, have often gone to Apple’s top employees. Mr. Cook, Apple’s chief, last year received stock grants — which vest over a 10-year period — that, at today’s share price, would be worth $427 million, and his salary was raised to $1.4 million. In 2010, Mr. Cook’s compensation package was valued at $59 million, according to Apple’s security filings.
A person close to Apple argued that the compensation received by Apple’s employees was fair, in part because the company had brought so much value to the nation and world. As the company has grown, it has expanded its domestic work force, including manufacturing jobs. Last year, Apple’s American work force grew by 8,000 people.
While other companies have sent call centers abroad, Apple has kept its centers in the United States. One source estimated that sales of Apple’s products have caused other companies to hire tens of thousands of Americans. FedEx and United Parcel Service, for instance, both say they have created American jobs because of the volume of Apple’s shipments, though neither would provide specific figures without permission from Apple, which the company declined to provide.
“We shouldn’t be criticized for using Chinese workers,” a current Apple executive said. “The U.S. has stopped producing people with the skills we need.”
What’s more, Apple sources say the company has created plenty of good American jobs inside its retail stores and among entrepreneurs selling iPhone and iPad applications.
After two months of testing iPads, Mr. Saragoza quit. The pay was so low that he was better off, he figured, spending those hours applying for other jobs. On a recent October evening, while Mr. Saragoza sat at his MacBook and submitted another round of résumés online, halfway around the world a woman arrived at her office. The worker, Lina Lin, is a project manager in Shenzhen, China, at PCH International, which contracts with Apple and other electronics companies to coordinate production of accessories, like the cases that protect the iPad’s glass screens. She is not an Apple employee. But Mrs. Lin is integral to Apple’s ability to deliver its products.
Mrs. Lin earns a bit less than what Mr. Saragoza was paid by Apple. She speaks fluent English, learned from watching television and in a Chinese university. She and her husband put a quarter of their salaries in the bank every month. They live in a 1,080-square-foot apartment, which they share with their in-laws and son.
“There are lots of jobs,” Mrs. Lin said. “Especially in Shenzhen.”
Innovation’s Losers
Toward the end of Mr. Obama’s dinner last year with Mr. Jobs and other Silicon Valley executives, as everyone stood to leave, a crowd of photo seekers formed around the president. A slightly smaller scrum gathered around Mr. Jobs. Rumors had spread that his illness had worsened, and some hoped for a photograph with him, perhaps for the last time.
Eventually, the orbits of the men overlapped. “I’m not worried about the country’s long-term future,” Mr. Jobs told Mr. Obama, according to one observer. “This country is insanely great. What I’m worried about is that we don’t talk enough about solutions.”
At dinner, for instance, the executives had suggested that the government should reform visa programs to help companies hire foreign engineers. Some had urged the president to give companies a “tax holiday” so they could bring back overseas profits which, they argued, would be used to create work. Mr. Jobs even suggested it might be possible, someday, to locate some of Apple’s skilled manufacturing in the United States if the government helped train more American engineers.
Economists debate the usefulness of those and other efforts, and note that a struggling economy is sometimes transformed by unexpected developments. The last time analysts wrung their hands about prolonged American unemployment, for instance, in the early 1980s, the Internet hardly existed. Few at the time would have guessed that a degree in graphic design was rapidly becoming a smart bet, while studying telephone repair a dead end.
What remains unknown, however, is whether the United States will be able to leverage tomorrow’s innovations into millions of jobs.
In the last decade, technological leaps in solar and wind energy, semiconductor fabrication and display technologies have created thousands of jobs. But while many of those industries started in America, much of the employment has occurred abroad. Companies have closed major facilities in the United States to reopen in China. By way of explanation, executives say they are competing with Apple for shareholders. If they cannot rival Apple’s growth and profit margins, they won’t survive.
“New middle-class jobs will eventually emerge,” said Lawrence Katz, a Harvard economist. “But will someone in his 40s have the skills for them? Or will he be bypassed for a new graduate and never find his way back into the middle class?”
The pace of innovation, say executives from a variety of industries, has been quickened by businessmen like Mr. Jobs. G.M. went as long as half a decade between major automobile redesigns. Apple, by comparison, has released five iPhones in four years, doubling the devices’ speed and memory while dropping the price that some consumers pay.
Before Mr. Obama and Mr. Jobs said goodbye, the Apple executive pulled an iPhone from his pocket to show off a new application — a driving game — with incredibly detailed graphics. The device reflected the soft glow of the room’s lights. The other executives, whose combined worth exceeded $69 billion, jostled for position to glance over his shoulder. The game, everyone agreed, was wonderful.
There wasn’t even a tiny scratch on the screen.
David Barboza, Peter Lattman and Catherine Rampell contributed reporting.
Monday, January 16, 2012
Thursday, December 29, 2011
Best Films of 2011
1. A Separation
2. The Tree of Life
3. Hugo
4. Drive
5. Shame
6. Martha Marcy May Marlene
7. Warrior
8. Midnight in Paris
9. Hanna
10. The Girl with the Dragon Tatoo
11. The Artist
12. Contagion
13. Le Havre
14. Super 8
15. Poetry
16. Senna
17. Into the Abyss
18. The Descendants
19. Carnage
20. Beginners
21. Myth of the American Sleepover
22. We Need To Talk About Kevin
23. Melancholia
24. Like Crazy
Need to See:
50/50
A Dangerous Method
Another Earth
Attack the Block
Bridesmaid
Buck
Cave of Forgotten Dreams
Certified Copy
Circumstance
Extremely Loud and Incredibly Close
Gun Hill Road
Harry Potter and the Deathly Hallows
Ides of March
Incendies
J. Edgar
Jane Eyre
Margaret
Margin Call
Meek's Cutoff
Mission Impossible: Ghost Protocol
Moneyball
My Week with Marilyn
Mysteries of Lisbon
Nostalgia for the Light
Pariah
Pina
Rampart
Rango
Red State
Rise of the Planet of the Apes
Sherlock Holmes
Submarine
Take Shelter
The Adventures of TinTin
The Arbor
The Clock
The Future
The Help
The Interrupters
The Kid with the Bike
The Skin I Live In
Tinker Tailor Sholdier Spy
Tyrannosaur
Uncle Boonmee Who Can Recall His Past Lives
War Horse
We Bought a Zoo
Weekend
Win Win
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