While many of the debates regarding Multinational activity has concentrated in the regulations of corporations and the displacement of workers due to offshore/outsourcing production, little has been said about the impacts of mechanization in labour markets worldwide.

Multinational Corporations are praised by transferring production to other states in search for competitive advantage terms in production, and primarily due to their ability to foster innovation and technological development around the world. The use of assembly lines in manufacturing countries such as China has created a large diffusion of goods and services throughout the world, generating an immense amount of wealth and development for countries and corporations. However, this has come at a certain labour cost. As MNC’s seeks to offshore/outsource their production, local labour markets in countries such as the US and Canada have dealt with significant decreases in manufacturing employment, hurting the lives of millions of blue collar workers. Nationalist movements are developing following this rhetoric, as MNC’s seek to gain more profits with low-wage production, home economies are experiencing loss of jobs and opportunities to different countries.

But what happens when this is no longer the problem of economies? what happens if the model of offshoring to China exhausts itself? MNC’s are largely successful due to their technological means to generating new products. New technologies increase the efficiency of factors of production, reducing time constraints in production. The mechanization of production has allowed economies of scale in generating large amounts of profits for corporations. But, with the advances in technology and mechanization, more and more laborers are prone to face employment insecurity, as they fear that machines might substitute their job one day.

This fear is real and understandable. Not only so, it is detrimental to the study of Multinational Corporations. New forms of production, such as 3-D printing, appear to be, on one side, a facilitator of production, but at the same time, a threat to employment in manufacturing countries. What will happen when 3-D printing, and other labour-replacing techniques, develop to the extent that they are present in all forms of production? The threat is clear. The fear of losing jobs in the US will extend to other countries in the world, most precisely manufacturing countries in Asia for example. The immense amount of labor in which countries have might not serve as a comparative advantage for production anymore, as machines might displace Foxconn workers in the production of iPhones in China, or displace auto-assembly workers in Hyundai, in South Korea. Some are saying that this is another “industrial” revolution that will take place in the world, and yet, little efforts have been made to understand the ramifications of mechanization in global labour markets.

In addition, the question arises: if countries with surplus labour might face comparative advantage exhaustion with mechanization, what will happen to countries such as US and Canada? With low surplus labour? One trend is to shift employment towards the production of services, making the country less dependent on manufacturing. However, manufacturing is very important for any country, and countries such as the US cannot lose their global share in manufacturing activities. Thus, how to curb the advances of mechanization in the destruction of jobs worldwide? Should we adopt these machines and train humans to develop their comparative advantage in other areas? It is hard to say… it depends largely on the interests and policy perspectives of different nations in recognizing this as a real threat to global labour markets.

http://www.economist.com/news/21566427-new-technologies-3d-printing-will-transform-assembly-line-manufacturing-future