China Economics Expert Skeptical Of Foxconn Job Claims

China Economics Expert Skeptical Of Foxconn Job Claims

The state would be paying for 30% of Foxconn's total investment in the plant, and this wouldn't be the end of it.

"We want to make sure it's a fair deal for everybody", he said.

The announcement Wednesday comes at a critical juncture for a Trump administration that pledged to generate manufacturing jobs but has struggled to deliver results as quickly as the president promised.

Wisconsin governor Scott Walker and Foxconn chairman Terry Gou signed a memorandum of understanding yesterday, which also included the sale of at least 1,000 acres of land.

"If I didn't get elected, he definitely would not be spending $10 billion", Trump said. The governor said he would like to see some changes made to the UW system to reflect the upcoming workforce, and also mentioned an increase in enrollment for technical schools.

But the decision to build the plant in Wisconsin also stemmed from $3 billion in state economic incentives over 15 years if Foxconn invests $10 billion in the state and ultimately adds 13,000 jobs.

The average salary for the jobs will be almost $54,000, suggesting some of the higher-end positions will be engineers, software developers and people proficient in computer-assisted design, Still said.

While a site has not yet been selected, Walker said ground on the new Foxconn campus in southeastern Wisconsin would be broken sometime next year, with operations set to start in 2020. The campus dubbed "Wisconn Valley", would cover almost 1.6 square miles and be three times the size of the Pentagon.

But he expects Wisconsin's plant, which will produce liquid-crystal display screens used in televisions, could be highly automated.

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The plant will be in House Speaker Paul Ryan's district, and represents a big win for the Republican leader.

The United States has added 70,000 manufacturing jobs since November, bringing the total to almost 12.4 million, but has not added any net factory jobs in the last two months, according to the Bureau of Labour Statistics.

"It could become a really good deal for the state if Foxconn attracts suppliers and other manufacturing we normally wouldn't have had".

"This will not be your grandfather's factory", said Tom Still, president of the Wisconsin Technology Council. That makes the prospect of import tariffs a real risk because Apple can't easily ask contract manufacturers to put its phones together in the U.S. IHS Markit estimates that iPhone 7 manufacture costs $5 per handset in China, where labor costs are about 10 times cheaper than in the U.S.

Walker said in an interview Thursday on WTMJ-AM that Taiwan-based Foxconn will only get the money if it fulfills its promise to build the plant and hire up to 13,000 workers.

Walker says there will be a special legislative session to work out an incentives package in August. They include up to $1.5 billion in income tax credits for job creation, $1.35 billion in income tax credits for capital investment and up to $150 million in a sales tax exemption for the purchase of construction materials. "I don't know how Foxconn could guarantee that", said Tom Still, president of the Wisconsin Technology Council, a nonprofit that advises the governor and the Legislature.

In addition, Walker said Wisconsin's agreement with Foxconn would contain terms permitting the state to recapture tax dollars if the manufacturer's employment numbers drop in future years.

The president had met personally with Gou, who on Wednesday complimented Trump's leadership at the event by saying, "Mr. President, the eagle flies".