Wao... Look at this.. Go Silicon Valley.. Go..

Despite very poor overall job report from the country.. there is some silver lining.. Rest of the country should learn from this... Some of the key numbers which are hidden deep bottom of this article about jobs.. 


San Jose Bay area created:

1. almost half (44%) of California jobs in month of June
2. one fifth (21%) of entire US jobs which means that almost half of the US jobs were created in California!!

Sad part mentioned in this article is... as per them need for technology and tech-equipment is even more due to slower growth in other areas. Which as per them makes employers to buy more technology to maximise their productivity.. I kind of disagree this statement.. I think, jobs where you need human power are difficult to be replaced by machines.. as per me human jobs are needed where you need brain to think!! not just using your hands to do some repeatable jobs.. those jobs are any how machine jobs..

Creation of jobs is about creating value added work.. though no offense to service industry but service industry jobs should follow real value enhancement jobs like R&D/Technology and manufacturing.. Manufacturing jobs are also coming back to US, but still, long way to go.. unless, US workers accept fact that they are not very high paying and all that Union etc.. bull-shit won't work.. it is difficult to get them back..

 Best hope for nation is to create technology jobs like in the ones being created in California.. California has two major job engines.. Technology in North and Media/Arts in South.. Now a days, even media/arts is heavily dependent on technology.. so essentially, you need big investments in technology for arts & media.. which enables lot of art/media work to be off-shored.. Which is a fact of life.. "Work, live, play.. Anywhere!!!" is going to be the way forward.. there is no escaping of it.

If you think you have Geo-Location advantage.. No.. you are wrong!!! it may give you slight edge in beginning but eventually someone else will catch up and take away your work and do it not only cheaper but most likely better.. Only way for you to sustain that job locally in that physical geo location is that you re-invent and continuously create additional value.. you have to be good in science/tech/arts/media.. whatever you are doing..

To enable this, US has to change few things.. Current education system prepares majority of kids to be ready for service industry or sales / marketing type of jobs.. unless.. parents works hard with kids to get their focus back to Science and Maths.. They have to change the way maths, science and more importantly technology is taught in elementary, middle and high-schools.. US has to make technology a mandatory subject like arts, language and maths etc.. upgrade technology infrastructure of schools..

US spends so much on education.. this mandatory technological upgrade cost will be nothing as compared to their regular spending.. they have to set it up right now.. it is already too late.. but better late than never. Kids over here are so brilliant (for that matter all the kids are brilliant) due great creative and lively way of education.. if kids start applying their same creative sense to technology as well.. there could be thousands of other silicon valleys across the US.. and then we don't have to look up only to Silicon Valley to create jobs..

Tech hiring spurs June jobs surge across Bay Area

By George Avalos

gavalos@bayareanewsgroup.com 

The Bay Area job market roared to life in June, reversing a recent slowdown in growth by creating nearly 17,000 jobs.

A strong technology sector combined with robust job gains in the East Bay to produce the best onemonth job growth performance since September for the nine-county region.

“What really leaps off the page is the big gain in the East Bay,” said Michael Bernick, a research fellow with the Milken Institute. “The other big factor is technology. Tech, social media companies, Internet commerce firms — they are leading this.”

The East Bay added 7,400 jobs, the South Bay gained 4,000 and the San Francisco-San Mateo-Marin metro region produced 6,100 new jobs, according to seasonally adjusted numbers from the state’s EmploymentDevelopment Department.

Overall, the Bay Area added 16,900 payroll jobs in June.

High tech accounted for at least one-quarter of the gains, this newspaper’s analysis of results supplied by Beacon Economics shows.

“We continue to see tech companies that are growing,” said Mark 

Howard, managing director of the Berkeley office of Management Recruiters. “That kind of expansion requires additional employees.” 

Two categories dominated by technology employees — professional, scientific and technical services, along with information services and products — combined for a gain of 4,700 jobs in June. The South Bay, East Bay and San Francisco-San Mateo-Marin regions all showed gains in these tech sectors. 

The upswing in the Bay Area was a welcome counterpoint to the sluggish employment gains of the spring. Employers added only 2,400 jobs in April and 3,800 in May, a sharp slowdown from the previous months of winter and fall. 

Some analysts feared that the suddenly sluggish job growth nationwide could produce a slowdown in the Bay Area. But the region produces what companies and other organizations want, said Jordan Levine, director of economic research with Beacon Economics. 

“Nationally, you still see a lot of purchases of computer equipment, Internet products and services, software,” Levine said. 

Ironically, the overall feeble U.S. economy may be giving a boost to the tech industry, according to Levine. “Tech is a way for employers to maximize productivity and efficiency without hiring employees,” he said. 

California added 38,300 jobs last month, which means the Bay Area accounted for 44 percent of all jobs added in the state — and 21 percent of the job gains for the entire nation. 

“The Bay Area has basically helped California get its mojo back,” said Steve Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. 

The statewide unemployment rate improved to 10.7 percent in June, compared with 10.8 percent in May, the EDD reported. 

The Bay Area jobless rate was 8.5 percent in June, down from 8.6 percent in May, the Beacon study found. The East Bay posted a 9.2 percent jobless rate in June, down from 9.3 percent the previous month; the South Bay was unchanged at 8.6 percent; the San Francisco area was at 7.1 percent, down from 7.2 percent the previous month. 

Non-tech sectors also enjoyed gains. The East Bay added 1,200 construction jobs and the South Bay added 700 wholesale trade jobs and 600 retail jobs. The San Francisco metro region gained 800 hotel and restaurant jobs. 

“The overall recovery has spread out from its base in technology,” said Jeffrey Michael, director of the Stockton-based Business Forecasting Center at University of the Pacific. 

Contact George Avalos at 925-977-8477. Follow him at twitter.com/george_avalos. 

Foxconn entring into solar - Is it a good news or??

Looks like FOXCONN.. Contract manufacturing giant is getting into Solar Modules.. Knowing FOXCONN.. it is definitely a bad news for all the Industrial giants (even existing Chinese manufacturers) and even worse news for US based manufacturers.. Foxconn is known to be working on volumes with very low margin.. on top of that they have optimized their manufacturing beyond original Japanese manufacturer's dreams..

On second thoughts, US manufacturers or I should say, US Solar companies or even startups in Solar areas can easily get into solar big time.. They can probably hire or contract solar manufacturing to Foxconn, based on their new designs and innovations.. thereby greatly increasing innovation and efficiency of Sola Panels further.. So, as usual, US companies will benefit from it.. employees may not as much unless, you are into fewer high end design/R&D jobs..

However, it is definitely GREAT news for most of the consumers and for green technology. It shows that there is great promise ahead for green technology and very soon Solar Energy will become mainstream.. Way we buy TV/Game-consoles/iPhones.. we will start getting solar panels for our home and start upgrading them as they improve their efficiency... This should drastically reduce emissions and and hence green house gases and hence improve our next generation's future prospects!!! (I agree.. that was tooo much for such a small news.. but then who knows, my news analysis/prediction may turn out true!!!)

FOXCONN Entry into solar may push down prices

Foxconn Technology’s decision to start making solar power modules may speed the rate at which margins are narrowing for Chinese manufacturers, another blow for an industry already coping with a plunge in prices. The Taiwanese company that’s the world’s biggest contract maker of electronics including Apple’s iPhone has started work on a solarmodule plant in China’s eastern province of Jiangsu. “Foxconn plans to build new factories with undreamed- of scale and lower cost,” Jenny Chase, who leads a team of six solar analysts at Bloomberg New Energy Finance, said. “It will push capacity higher and prices lower.” Prices for solar cells have skidded 62 percent this year as Chinese companies led by Suntech boosted production and won market share from European and Japanese rivals.

How Germany became China of Europe

A very interesting article in Times Magazine. Though I honestly don't like comparison with China. China's manufacturing capability is mostly based on cheap labor and poor working conditions. I am assuming that this is not the case with German workers who are much better paid off and work not just for making money but also for passion of making something really great.  Also, Chinese goods are for lower segment. Where as Germans target for high end premium quality products.

Even though, everywhere in US we see made in China or other countries, but the fact is that US is still world's biggest manufacturer in terms of dollar value. Still, 75% of all goods consumed in US are manufactured in US. Though most of the time, these goods are of extremely high value and are produced in highly automated manufacturing plants very much unlike China.

Despite all of the above it is very interesting article and must read. Though, later part of this article deals more on rest of the Europe's frustration with German manufacturing machinery. Which is more of simple envy as of now. However, rest of the Europe also knows it very well that it is their own actions and inactions which have led them to this state. Five years back when Germany was making very anemic growth rate of 2-3 percent and rest of the Europe was riding on Financial and Mortgage based boom, they were making fun of Germans for being old fashioned and traditional who don't understand new economy (or then new economy, of circulating money like ponzi schemes and feeling great about it).

Now, bottom line is, can US learn something out of it and fix state of economy by fixing passion and art of manufacturing with human touch. Definitely, there is lot to learn. I very strongly feel that Americans by their blood are very creative and can create wonders if they work on this field back. I think government needs to understand that and accept that it was gross mistake to encourage outsourcing in manufacturing base. They need to work hard to bootstrap manufacturing economy again. Provide right kind of tools and encourage manufacturing. They can think of creating some Special zones to encourage manufacturing back in US. I think there are enough experts to advise US on how and what to do, once they decide that they want to do it.

I think this is more than enough long.. Here is the link to original article.

http://www.time.com/time/magazine/article/0,9171,2053595,00.html

Can manufacturing ever come back to US

I was reading one article written by Andy Grove in Bloomberg on manufacturing jobs in US as suggested by my good old friend Amit.

http://www.bloomberg.com/news/2010-07-01/how-to-make-an-american-job-before-it-s-too-late-andy-grove.html

It is very sincere effort and in all probability he is right about it. It was biggest mistake by US policy makers in 80s to let manufacturing slip out of US. That shouldn't have never been allowed in first place. Without good manufacturing base in high tech US is mostly dependent on rest of the world for most of the basic needs for goods. However, fact is that most of the manufacturing has already gone out and whatever is remaining, is going out continuously.. Unless federal or state governments subsidize local industry or penalize import, manufacturing in US is not going to come back..

Question is, whether it is worth bringing back. Honestly it is dirty work and no body wants to do it here. If we were really good and passionate about manufacturing we would have survived cheap workforce syndrome of Mexico, China, far east.. Honestly, I feel, once Henry Ford started assembly line system for manufacturing it made it pretty boring and this boredom was responsible for poor manufacturing performance out here in US.  Otherwise why didn't we improvise on our manufacturing, way Japanese did it and even with higher cost basis for labor we could have kept it here. Basically, I feel that assembly line kind of manufacturing is/was very much opposite to Free and Creative spirit of Americans. It was/is pretty mundane with same task keep on doing like robots. That is what Japanese did, automated it and worked hard on building Robots. We didn't...

Our Policy makers thought that we will have enough jobs designing and engineering robots (or machines for assembly lines). Which was true in beginning. But they forgot to see future.. Once you have basic manufacturing revolution, you start developing adjacent technologies and slowly creep into other design, engineering, testing and other fun stuff. Where as once you don't have it (like in US), you start loosing touch with this so called fun stuff which you had hoped that it will continue generating employment. Now, even companies who make these kind of machinery for manufacturing (I guess, AMAT kind of companies) also started moving work to these countries so they can be closer to their customers and market.

Other fundamental breakdown with this policy happened when US policy makers failed to reform education along with this shift in manufacturing. They thought that US will be doing high value R&D and other managerial kind of jobs and let these manufacturing and call center go out. When these mid category jobs were going and there was surge in high end jobs there were no local man power to support There were not enough students coming out of college to take up these high tech jobs and that forced US companies to go out and even off shore these jobs in India and many other developing economies. Slowly this set up took effect and these US companies got addicted to lower cost of doing R&D in offshore. So US ultimately started loosing these high tech jobs as well.

So what now? The only hope is with Bio Tech or similar areas.. Unless republican's don't mess it up.. I guess. There has to be some next Quantum leap which will spur growth and hopefully we will be ready for it and won't miss the boat. US policy makers need to make sure that there is enough emphasis on education in K-12 and subsequent University system so we can't miss this opportunity. Also, this time if we are able to get this kind of Quantum leap we should be able to keep complete eco-system of R&D, Design, Engineering, Manufacturing and QA in house. Even if it means that we provide some kind of subsidy to local entrepreneurs.

Otherwise, very soon my kids may be in line to get Indian/Chinese green Cards so that they can work there.