Asian manufacturing has expanded greatly in recent decades and continues to shape the world of manufacturing. While China comes to the minds of many when people talk of manufacturing, it is only one piece of the pie when it comes to production in Asia.
The attraction of manufacturing in Asia comes from a number of different factors. The most important relates to investment. Asian nations have traditionally invested well in both physical and human capital. These investments have given Asian manufacturing an edge.
With good investments in physical capital, many Asian nations can offer good roads, ports, telecommunications and other infrastructure that makes doing business a lot easier and more productive.
Asian nations also tend to put a high value on education. This has led to labor forces that are more educated and disciplined than those in some other areas of the world. This, combined with a large population base, offers manufacturers an attractive labor pool.
Advanced, integrated and global
While it was not so long ago that Asian manufacturing was concentrated on low-wage production and simple assembly, much of the region has moved to much higher value added manufacturing. Factories from Japan, Taiwan and Malaysia produce some of the world’s most sophisticated parts. In fact, Asian factories are now often the only places many of the world’s most sophisticated electronics are made.
Varied with the region
Asia itself is a very diverse region and so is the manufacturing done there. Although some countries have moved into much more value added manufacturing and higher wages, others still concentrate on labor-intensive production. From high tech manufacturing in Japan to garment production in Vietnam, the region offers it all. Those looking for manufacturing can choose from conditions as diverse as India, Cambodia, Taiwan, Thailand and Singapore.
Of course, Asian manufacturing is not for everyone. There are products that are better manufactured elsewhere, and wage advantages are not always significant. In addition, the distances involved sometimes makes manufacturing in Asia impractical in an era of rising shipping costs.
Still, with the many advantages Asia offers, it will remain the best place to produce many products for the foreseeable future. Those sourcing manufacturing will always need to take the area into consideration.