Apple steps up its effort to emphasize its economic impact


Apple will create a $1 billion fund to create manufacturing jobs in the US, CEO Tim Cook announced on Wednesday.

He didn’t give any further details on how the fund will be given out or who will be eligible to receive it, but promised more information was coming.

Apple also announced on Wednesday that it had created more than 1.5 million jobs in the US. 

Experts suggested both claims appear to be part of a concerted effort to emphasize the company’s role in the economy – and to fend off criticism from Donald Trump.

Apple CEO Tim Cook (pictured) told CNBC Wednesday the company will create jobs in the US with a a $1b fund. But he didn't elaborate on how that fund would be given out, or to whom

Apple CEO Tim Cook (pictured) told CNBC Wednesday the company will create jobs in the US with a a $1b fund. But he didn't elaborate on how that fund would be given out, or to whom

Apple CEO Tim Cook (pictured) told CNBC Wednesday the company will create jobs in the US with a a $1b fund. But he didn’t elaborate on how that fund would be given out, or to whom

Also on Wednesday the company boasted of jobs it was creating in the US (pictured: a store in New York). Experts say they want to stave off attacks on their use of Chinese factories

Also on Wednesday the company boasted of jobs it was creating in the US (pictured: a store in New York). Experts say they want to stave off attacks on their use of Chinese factories

Also on Wednesday the company boasted of jobs it was creating in the US (pictured: a store in New York). Experts say they want to stave off attacks on their use of Chinese factories

Cook first described the manufacturing fund an interview on CNBC and said Apple will provide more details when it announces its first investment by the end of the month.

The company’s initial billion-dollar investment amounts to a tiny fraction of its $257 billion in cash.

He also promised that Apple will hire ‘thousands of employees, thousands more in the future’ in the US, although he didn’t specify how quickly that will happen. 

Apple’s US payroll has grown roughly 40-fold since 1998, when it had 5,000 US workers.

On the subject of its employees, the company launched a sub-site on Wednesday boasting of its contributions to job creation in the US across all 50 states. 

This is the fourth such report from Apple since 2014, which are intended to underscore its contributions to US jobs and economic growth. 

Its first report came after years of complaints about labor practices and suicides at Foxconn, one of the company’s major contractors in China, drew more attention to Apple’s reliance on overseas factories.

Donald Trump has said he wants to impose tariffs on China, which would raise Apple's costs. The company hopes that it can generate a positive image that will keep critics at bay

Donald Trump has said he wants to impose tariffs on China, which would raise Apple's costs. The company hopes that it can generate a positive image that will keep critics at bay

Donald Trump has said he wants to impose tariffs on China, which would raise Apple’s costs. The company hopes that it can generate a positive image that will keep critics at bay

But this latest report featured a state-by-state breakdown of where its 80,000 US employees work, showing that more than half are located outside Silicon Valley.

Experts suggested that the reports were an attempt to disarm criticism about the company’s reliance on cheap Chinese labor for its products – and to avoid a potentially stock-slamming Trump tweet.

Trump has threatened to impose tariffs on products from China, a change that would drive up Apple’s costs.

That could pressure the company to raise its prices at a time when it is already having trouble increasing its sales of iPhones and iPads.

‘They are trying to make the case that they really do have a lot of folks working in the US,’ said technology industry analyst Rob Enderle. 

‘So if want to pick on somebody, you might want to pick on somebody else because they won’t be a good example.’

Trump has attacked many companies, frequently on Twitter, for moving jobs out of the US and lavishly praised those who have announced major hiring initiatives. 

As a result, many companies, including Exxon Mobil, Intel, Charter Communications and Ford Motor, have unveiled big hiring plans, though in many cases they were already in the works before the presidential campaign.

‘There is a lot of political pressure to create jobs in the United States,’ Diane Swonk, CEO of DS Economics, said. Chief executives ‘do not want to show up in a tweet.’

In December, Trump tweeted that the cost of Lockheed Martin’s F-35 jets was ‘out of control’ leading to a five per cent drop in the company’s stock price.

Apple had no comment on political ramifications of its announcements. 

Experts also said they may fear a negative tweet by Donald Trump, which can affect share prices. Stock for Lockheed Martin fell five per cent after this tweet in December

Experts also said they may fear a negative tweet by Donald Trump, which can affect share prices. Stock for Lockheed Martin fell five per cent after this tweet in December

Experts also said they may fear a negative tweet by Donald Trump, which can affect share prices. Stock for Lockheed Martin fell five per cent after this tweet in December

Apple also  claimed it made 1.5m US jobs (map pictured) as a knock-on effect of its App Store - but critics say app makers produce for Android phones too, so Apple can't take full credit

Apple also  claimed it made 1.5m US jobs (map pictured) as a knock-on effect of its App Store - but critics say app makers produce for Android phones too, so Apple can't take full credit

Apple also claimed it made 1.5m US jobs (map pictured) as a knock-on effect of its App Store – but critics say app makers produce for Android phones too, so Apple can’t take full credit

The company’s jobs report also cited a study by the Progressive Policy Institute that attributes 1.5 million US jobs to Apple’s iPhone ‘ecosystem.’

That figure includes related jobs, such as HR managers and accountants at app companies, and restaurants and banks supported by those companies; Apple claims its App Store made that possible.

But Swonk said that it was a stretch for the company to claim credit for the entire app industry.   

The vast majority of app developers, for example, also produce apps for Android phones produced by Samsung and other manufacturers.

The Public Policy Institute only found 1.7 million jobs in the entire ‘app economy’ – and 1.35 million of those were associated with Android apps. Most of those overlap with the jobs linked to Apple.

In his CNBC interview Cook also said Apple is examining ways to help more people learn the programming skills to make apps.

APPLE’S AMERICAN EMPLOYEES 

The Wednesday report on US jobs is the fourth to be issued by Apple since 2014, when it came under fire after suicides at its contractor’s factories in China.

But it is the first to include a state-by-state breakdown of Apple employees.

Unsurprisingly, the numbers show its highest concentration of workers (36,786) is located in California, home to the company’s Silicon Valley headquarters and 53 stores. 

Apple’s second biggest employment center is in Texas (8,407 jobs), where it has a corporate campus and 18 stores. Its smallest pockets of employment are in North Dakota (four jobs), Vermont (six) and Wyoming (seven).

Apple’s decision to provide detailed information about the locations of its US employees could help the company win support from lawmakers eager to protect jobs in their states, technology industry analyst Rob Enderle said.

That would give then a much-needed boost if they came under attack from Donald Trump for manufacturing abroad. 

‘It gives senators something to push back with, recognizing that Apple is a real risky company to target anyway because its products are so popular with people,’ he explained.

Besides showing how many of its full-time and part-time employees work in each state, Apple also lists where its 9,000 US suppliers are located. 

The company says it spent more than $50 billion at its US suppliers last year, helping them employ a total of 450,000 workers.



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