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Price of phone assembly less than a combo meal

2010-07-08

This interesting piece on the manufacturing costs of the iPhone 4 reveals that 60% of the price at the register goes to Apple, AT&T, and other companies involved in the design and marketing of the device, and not even 2% of the price – $6.54 – goes to the manufacturing labor cost.

Every day, you’ll read stories in US newspapers lamenting the lack of “quality” manufacturing jobs. The reason these jobs are disappearing is not because we’re outsourcing to other countries. They’re disappearing because they are not needed — US manufacturing output reached an all-time high before the 2008 recession, even as the manufacturing labor force continued to recede. US employees are making more money on the creative side in design, development, technology implementation and marketing of products.

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