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Tech Firms Defend Moving Jobs Overseas
bobcows writes "Yahoo is reporting about leading technology companies urging Congress and the Bush administration Wednesday not to impose new trade restrictions aimed at keeping U.S. jobs from moving overseas, where labor costs are lower. 'There is no job that is America's God-given right anymore,' Carly Fiorina, chief executive for Hewlett-Packard Co., said Wednesday. 'The problem is not a lack of highly educated workers,' said Scott Kirwin, founder of the Information Technology Professionals Association of America. 'The problem is a lack of highly educated workers willing to work for the minimum wage or lower in the U.S. Costs are driving outsourcing, not the quality of American schools.'"
Or above. Any problems with that? Same goes for Nike and their "sweatshops". No difference as far as I'm concerned.
Trade restrictions..
is this the American today ?
'The problem is a lack of highly educated workers willing to work for the minimum wage or lower in the U.S. Why should people settle for less? Of course people are going to want more, basic human instinct. Do they think that people are just going to want to work for HP just because its HP? Sounds like Fiorina is very much in favour of a form of slave labour.
TheHustler
http://www.elmarko.org/ - Useless bilge
http://www.asylum-games.co.uk/ - Co-Founder
Well I'm a CS student about to graduate with my bachelors degree. I've found that the pay for the jobs out there hasn't decreased it's simply the number of jobs available has gone down the toilet. I used to think I would have a job straight out of college but now I'm a bit worried. There are more people applying for less and less jobs now. I've had several interviews but lost them due to a more experienced guy needing the job that before I might have had a good chance of landing. And realistically how can they expect people in America to work for less money when our cost of living is so high here?
Hold up, wait a minute, let me put some pimpin in it
Carly's totally right -- what makes a job yours by birthright? Compete like everyone else.
Neoprotectionist policies help a few people out in the short run, but hurt everyone in the long run by imposing unnecessary costs on products.
If it ain't broke, you need more software.
The problem is a lack of highly educated workers willing to work for the minimum wage or lower in the U.S....
Well, isn't that kind of a fundamentally flawed problem? As a person pursuing a degree in higher education (dropping $100,000+ on said education) I don't feel like it would be worth it to work for minimum wage or less. I mean, isn't that really one of the points of college, so you don't have to work minimum wage?
In her comment, Carla Fiorina fails to understand basic economics. You can't talk about labor costs and only talk about wages. The cost of labor is the wages divided by the productivity. It is only true that lower wages reduce labor costs if productivity is constant. But productivity is much lower in developing countries because of poor infrastructure, corruption, market inefficiencies, and weaker educational systems. It is meaningless to talk about wages without talking about productivity.
Not that I like it, especially as an IT worker, but, hell, that's the nature of the beast. Our dirt cheap goods are possible because we "allowed" loads of manufacturing jobs to go to China. In the end all it really means is that we can't rest on our laurels. And that's probably a good thing.
CommentBot 0.7a running with args "-module irritate,disagree -target random"
I don't like to see the US Govt. legislating corporate policies...but, I don't mind them giving them incentive to shape said policy towards thing beneficial to US citzens.
But, c'mon....minimum wage for an educated person? I can't believe any US business would expect that.....
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
'There is no job that is America's God-given right anymore,' Carly Fiorina, chief executive for Hewlett-Packard Co., said Wednesday.
There were never any jobs that were America's God-given right, but the sentiment does make a nice dodge from the real issue at hand.
What these corporations seem to have forgot is that privelege goes hand in hand with responsiblity. They fight hard to continue to be treated by the government (and thus the nation, by extension) as a citizen with all the rights thereof. However, they forget that those rights come with responsiblity. They move jobs overseas, they keep their funds in offshore tax havens so they don't have to pay taxes, and then they want they want to be treated like legitimate tax-payers. Globalisation is a nice idea, but not when it only serves as a tool to cheat.
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Her job surely isn't a God-given right. When an Indian company produces products comparable to HP's for a fraction of the cost, her executive position will effectively have been outsourced.
If it ain't broke, you need more software.
"The problem is a lack of highly educated workers willing to work for the minimum wage or lower in the U.S."
Did she actually say that? Being highly skilled and not being willing to work for below minimum wage is a *problem*? I'm speechless. I don't know what to say. My mouth is currently agape.
This is certainly not a company I would want to work for at any price, if this is how they think of their employees. She probably thinks her employees owe *her* money for hiring them!
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illegitimii non ingravare
It works like this. There is basically no job (other than service, like working at a store) that can't be done cheaper by people outside this country.
It is the governments job to make sure that jobs stay here. I don't think any job is an americans god given right but why does this lady expect an educated engineer to work for min wage? I can get a McJob for min wage. She is essentially saying that HPs workers don't matter to the company. They find no value in their skills.
I'm not trying to be paranoid here but eventually won't most jobs be shipped over seas to countries who with lower cost of living and governments who don't care. This doesn't sound good for our country.
Whether or not these jobs are "America's God-given right" is besides the point, Carly, you miserable bitch. Of course they aren't a "God-given right". Nothing is. The real question here is whether the U.S. will act in its own self-interest, or continue to throw its labor force into a low wage bidding war with the Third World.
Take a look at the money being paid to Carly, then tell me again why any American should even consider buying HP ever again when she makes comments like that. An American company is paying her vast ammounts of American dollars, but when the economy's in the shitter, she ships jobs overseas. Good job. And no, I'm not American.
do not read this line twice.
Were going to start seeing new megacorps out of India soon. We've even setup their back offices for them. We trained their accountants, their technologist, and we even set up their R&D for them. They have their call centers taken care of, everything except the front office. Some of these companies are going to start refusing to renew contracts with our megacorps and are just going to start their own with their fully trained staffs. Their getting the back office profit, how much is left for a front office? Perhaps they'll turn around and outsource that to the originating corp?
On top of this, can someone please explain how sending good paying jobs out of this company is good for the economy? Competitive advantage doesn't mean anything if all the competition is doing it. The jobs that are replacing these are the low wage jobs in fields like retail that don't have things like health insurance.
No problem, just lower the cost of college to a few thousand a year, free health care, cut my rent, utilities, and food by more than half then provide me with public transportation that takes me from where I can afford to live to where I end up having to work. Do all of that THEN we can talk about dirt poor wages.
Funny how the executives never have a problem justifying their massive pay and perks.
It is by the juice of the coffee bean that thoughts acquire speed, the teeth acquire stains. The stains become a warning
What value to the country does an 'industry' have if they send all the jobs away? Some tax bucks, sure, but a company with jobs is much more valuable to the country.
greed is the primary motivator in our economic system.
'consumer' and 'capitalist' are just the slightly nicer terms we use for ourselves.
// "Can't clowns and pirates just -try- to get along?"
to graduate after the dot bomb. A large contraction in the number of companies in the tech sector 3 years ago means more people chasing fewer jobs. Especially in the areas that were the centers of tech. Silicon Valley and Northern Virginia, where I live. I was unemployed for nine months, and I have 10 years experience. Bank account gone, credit card maxed, was a week from starting a job in construction when I got the job I have now. Doing Python on Windows, FreeBSD, and Linux.
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Nor are highly educated workers willing to work for the (local) minimum wage or lower in places other than the U.S. It's just that the U.S. minimum wage provides a pretty good living in some parts of the world.
You know, painful as it is to those who pay the price, one can make the argument that this trend will, in the long run, help to minimize the economic disparities between the "developed" countries and the "third world." And that can't be bad for international security.
This post is symptomatic of a larger problem.
Go on any job board or discussion about outsourcing and you'll see the trolls and out-of-work complaining about how Indians are "stealing" American jobs, either through H-1B visas or overseas outsourcing. This is a case of blaming the wrong people.
The Indians aren't "stealing" anything. American CEOs, with the willing complacence of their bought-and-paid for politicians, are giving them the jobs. Until last year, the H-1B visa caps were permitted to increase despite convincing evidence of a slowdown in the tech market. Outsourcing advocates have convinced American companies that lower hourly pay rates are the savior of their bottom lines.
Some jobs, especially call center work and manufacturing are gone and aren't coming back. Others may drift back and forth as industry discovers a balance.
It's a supply and demand thing. One thing that you might also want to to worry about is those "schools" churning out paper MCSEs month after month, advertising big $$$ and life on Easy Street by passing a few tests and getting a few certificates. In an already overcrowded tech market, these places are turning out tons of folks with overblown expectations. Once their dreams are crushed, who knows how cheap they'll be willing to work?
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There are ten million unemployed right now. The average job (in my experience) lasts less than two years. People are unsatisfied with their jobs in massive numbers. Wages are stagnant if not falling rapidly.
I know zero people who are gainfully employed in a full time job paying a living wage. Zero.
Management absolutely forbids telecommuting, unless the employee works for another company.
Hiring is a subjective popularity contest with no accountability. Qualified people are passed over reguarly and often as a matter of policy.
Education is meaningless. Absolutely meaningless.
Once hired, most people find their jobs are gray, dispassionate drudgery where they are not allowed to open their mouths to say anything or to offer even a single new idea. This after being required to have decades of senior level experience and years upon years of advanced education (where, one assumes, they were also expected to keep their mouths shut).
Why not just sell it all, Mr. and Mrs. CEO? Just ship the whole fucking thing FedEx to elsewhere Inc.? It's not like you'll notice the total collapse of the economy from inside your Navigator or your half-million dollar townhouse. Just fuck over all your neighbors and cash those options. Everything will be just fine in time for the next backyard block party.
24/7 advertising. No job. No career. No credit. Basket full of crap at 28% interest. Get back on that fucking couch and keep your fucking mouth shut, consumer. This is the "corporate dream."
Business isn't willing to pay for products, innovation and careers, so we get brands, mortgage commercials and layoffs.
Ok, this is the thing I don't understand....and maybe someone can explain it to me. Why would I want a global economy?? From what I can see, it is beneficial to everyone EXCEPT the US. It seems to do nothing but deplete our jobs...standard of living, etc. What possible good can it do for us? It seemed to be better when we led production and innovation in most areas....
I mean, life is a competition...we use to seem to win, and now we aren't, and it is our own fault for 'giving in' and this global economy our corporations are supporting with these actions is going to cause our spiral and downfall. Keep this up, and we'll lower our whole society's standard of living....
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
You always buy the most expensive item, or use the internet to find the highest price for any purchase? Or do you look for the lowest price?
So why should business be forced to pay a higher price for the same commodity item - labor?
You want cheap goods, but do not want to lose your high paying job. You can't have it both ways.
Agreed. A lot of people go to school for long periods of time, get doctorates, master's degrees, etc. for the purpose of raising their earnings potential.
I've got a friend who's got a master's degree in biochemistry, and he's squeaking by (but not by much right now) but he's aiming to get a Ph.D. and end up in the upper middle class later in life. Would he do that if highly-educated people would get the same amount as a high-school dropout flipping burgers at McDonalds'? Hell no.
By HP's logic, we should all go to grad school (or equivalent) for ten years after getting our BS/BA, and then live in debt for the rest of our lives because our McJobs won't pay enough to pay off the horrid student loan debt.
And this is okay? I can't believe that anyone would make a statement like that, even a corporate flunkie, and be able to keep a straight face.
i am a soviet space shuttle
Even if they all suddenly would work for half the salary overnight, HP would have to reduce the price of their products too in order to ensure that people can afford to purchase them.
In other words, their percentage profit on an item would stay the same. The fact that educated workers can demand a higher salary in the US means that corporations can get away with providing more expensive goods. In many other countries, you'd never be able to sell something at US prices.
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My loans would cost me my entire take-home pay at minimum wage in the US. Why the hell would anyone want to learn a field, spend thousands of dollars to do so, and then no be able to make enough to pay the costs of the education? Meanwhile, Carly, et al get paid millions of dollars to risk other people's money while they have the opportunity/skill to drive their companies into the ground. (Good CEO's are worth the money, but lots aren't and they get paid anyway.) Do they think that we should be willing to work for nothing but that they should not? The rules of economics work for everyone, yet the people who run these businesses think that people should be willing to make sacrifices for their extravagant incomes (extravagant because of the amount of money/unit of competence). Why do I want DRM when it costs more and gives control of my computer to others while giving me no benefits in terms of costs or features? Why do I want to work in a field when I can make more money by not learning anything and being a garbageman^H^H^H^H^H^H^H^H^Hsanitation engineer? The same motives apply to everyone, yet some of the people who run companies seem to think that only they have the right (and desire) to behave in their self-interest.
The initial comments are correct - we don't have inherent rights to jobs - if someone can do it better and cheaper than us, they will get the job and we'll have to do something else. I simply have a problem with the PHB logic that the stated CEOs seem to labor under - that others should sacrifice their well-being for their benefit while they have no duty to do the same. I'm certain that if their logic were applied to their jobs (I'm pretty sure someone as competent as these CEO's could be hired from overseas at 10% of their pay), they would not be so quick to advocate sacrifice for the benefit of others.
Costs are driving outsourcing? How about wanting to make sure that ALL the money stays on the top? This is what completely amazes me in the world we live in, Joe Millionaire really believes that paying family providers a salary 1/100000th of his own is a COST.
Now don't get me wrong here, I'm not some hippie banging my Commie Drum here, but I wouldn't mind some honesty. When saying why you're outsourcing, simply tell what you are doing ...
1.) You are not outsourcing, you are laying off americans in a hope that every other company won't follow your lead (you still need people in america to buy your stuff right?)
2.) You are personally making the statement that you believe that it means more to have 3 yachts instead of 2, and the best way to get there is cheap labor.
3.) You believe that you are above 'regular' people in America, and would love to just keep screwing us all.
Well what's the problem with all of this? Think back into the history books for me a little bit here. At what point in America's history did we see an ever pressing economic turmoil because of extremely low cost labor? Was it, ohhh yes the bloodiest battle costing more American lives than any other war in our history?
Lets face it the Civil war was fought not to free the slaves, but in fact because the South was so rich because it legally could force people to work with no pay. This pissed off everyone else who HAD to pay their workers. Believe it or not some of the anger in the "Free North" was because they themselves weren't allowed to have slaves.
Getting a little bit off topic here, the point being is that this country was built on the backs of "Joe Average", who is in the lower to middle class. There's just one big problem with everything here, there are whole lot more "Joe Averages" than there are "Joe Millionaires" and you can only piss "Joe Average" off for so long before he and his buddies organize together.
So Mr Corperate Joe Millionaire, I implore you to please consider your actions and possibly not bite the true hand that feeds you, over and over and over and over again. "Joe Average" is collecting welare/unemployment because you believe he is not worthy. Lastly you can fight the government all you want, but remember there are more "Joe Averages" and if you keep pissing "Joe Average" o you may actually see democracy in action in which you as an American company will be spanked, because "Joe Average" also can vote.
Ignore the "p2p is theft" trolls, they're just uninformed
Not everyone can do the same things, some are blessed from birth with inherit capabilities, some work harder for them, some don't. So yes...your hard work (education) to attain skills that everyone else does not have DOES entitle you to better pay for your job...because is not something any 'joe' can do.
I'm not happy to see the blue collar jobs moved either....I think by putting our manufacturing outside our borders along with much of our intellectual work out there, will at some point become a national security danger. If other countries at some point get pissed at us...and cut off steel supplies (add whatever other industry here) to us...what will happen? WE don't have the manufacturing capabilities dues to shipping them overseas and across borders. Right now, we're worried about oil embargos? Well, wait till it is MUCH more than that that the world can threaten us with...
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
In other words, you have to make a big investment in your education so you can have a piece of paper that no longer guarantees you that you will recoup the costs of that education, let alone bring a return on investment you can live on. Welcome to the new world.
Amreica has been getting good wages compared to the rest of the world for some time now. If this was truely a problem American companies would have trouble competing for some time now. As industries mature there is a natural tendancy for them to move to cheaper markets overseas, in the meantime we (the U.S.) will go on to create new oppurtunities and markets, this is nothing new. What interesting about the moving of tech jobs is that how quickly it's happening, but I believe that it is a favor of the week. Most of the "cost savings" will never materilize or will be negated by falling sales, and higher corporate management costs. Some of the more technical jobs will return. However most will be lost (esp. the call centers), but then again how many televisions are made in the U.S. (none, BTW)
The grass is only greener, if you don't take care of your own lawn.
Parent should be marked insightful, not funny.
Executive compensation is way out of whack, and it's because the executive club takes care of itself. Boards of one company are filled with executives of other companies, and vice versa. It's a circle of people writing each other checks out of corporate accounts.
There's always the line of defense which is, "but we're critically important, and we're doing very difficult jobs." The same could be true of the IT personnel who have been outsourced. So therefore, the executives should be outsourced as well.
Imagine the millions each company could save if their executives were paid an Indian's King's Ransom, instead of an American's King's Ransom?
If the American execs want to keep their jobs, well heck, they can take a pay cut to be on par with their Indian counterparts, right?
The whole executive compensation issue wouldn't be so aggravating if all execs did a good job. But many suck. Many run their companies into the ground, resign when things get bad, get a parting gift of a few million, and then go become CxO at another company. Rinse repeat. Once an exec, always an exec, unless of course you're tied up in a federal country club.
.sigs are for post^Hers.
Yeah, that's right, capitalism is great and protectionism is bad. Unless its bad for business, in which case, we'll call it something else like "protecting intellectual property" or "national security" or even give it a *good* economic/management buzzword like "differential pricing" and conclude thats how markets most efficiently operate, and only terrorists and zealots and pirates and other people that aren't willing to go along with capitalism would disagree.
Well, I disagree. I think some protectionism IS worth it. I like my way of life, and I'm not willing to sacrifice it so the capitalist elite can get bigger bonuses or the pedantic economists can proclaim "more efficient markets".
"More efficient markets" sound great, but that perfect efficiency risks turning us all into faceless cogs of some huge machine, having to justify our every move and every need on the basis of its economic efficiency and benefit to the markets. Yuck.
Well there is a bit of a difference. A factory worker doesn't have an education investment that helped him get to that career. He just showed up one day, they took a few minutes showing him how to do some repetitive job, and that was that. It also didn't help them get any sympathy when they were getting paid very large wages for a manual labor job that a monkey could do, and other people in other parts of the country were doing jobs that had the same skill level but only paid minimum wage.
When the overpaid factory jobs went elsewhere, it wasn't that hard (in theory) to retrain those workers for something else. In many cases I believe, those workers had other skills, but stayed with the factory jobs because they paid very well and were very stable. When they lost the jobs, they used their other skills to find other employment. If you're already skilled in assembling cars, how hard is it to learn how to do oil changes, and go to work at Jiffy Lube? Construction also is a manual labor job that doesn't require any education, and it pays very well too.
Tech jobs are different: they require years of education to become qualified for. Sure, help-desk operators don't have Master's degrees, but companies are also moving engineering jobs overseas. If you have a Master's degree in engineering, which probably took 5-6 years to achieve, along with tens of thousands of dollars in student loans, you can't just retrain on a whim and get a different job.
Worse yet, just a few years ago all these same companies were whining about how there weren't enough engineers for them to hire. They yelled at the government to improve science and math education and encourage more kids to go to engineering school. Now that a bunch of people have gotten engineering degrees, they're being kicked out the door because these same companies found out they could outsource the work to 3rd-world countries for much less. Now these engineers are stuck with too much education to easily change jobs, and high student loans they still have to repay.
What I don't understand is why these stupid execs are still calling for better education in this country. What's the point if there's no jobs for the kids to go into because they've all been outsourced?
2. CEOs are hiring people who can do the work for the least money. In some cases they get burned by that because it turns out that the outsourced workers are inferior. However, in those cases where somebody can do your job just as good as you for a fraction of the wage... Guess what? You were getting paid more than you were actually worth. C'est la vie.
3. The "paper MCSEs" are not going to be willing to work cheap. Most of them went chasing after the advertising of "big $$$" because they wanted to make a lot of cash, not because they love to work in IT. When it they discover that they more as a plummer than as a PC help desk worker, they will change jobs, and we will be right back to needing H1Bs to fill some of our jobs when the market picks up again.
Information wants to be anthropomorphized.
Not everyone has the LUXURY of taking 4 years off of life to pursue education. Those *non-traditional* students that aren't racking up loans and are working themselves through school are heros, but they are not the students to use as the average example.
Todays univerisites are pumping out too many liberal arts degrees, which is fine if your degree in Psychology leads to your a profession in psychology, but does that same degree demand you get more money working a help desk with someone who didn't go to university? But you feel *entitled* to more money, that's fine, I invite your DEMAND it during the hiring process, I know plenty of guys that'll be there to pick up your scraps and will work damn hard once in the door.
I say all this being a college grad and having gone back twice for additional degrees. Although none of them are in the area I work in, I barely mention them on my resume and don't feel they entitle me to anything.
If that were true we whould all be driving a Yugo. Most people include percieved quality in thier buying decisions. Service is often a factor as well.
The grass is only greener, if you don't take care of your own lawn.
You are kidding right? Absolutely completely kidding right?
Your incredible standards of living have been so far sustained by a global economy created in great part by the USA for his own benefit. That is, the rest of the world is a global provider of cheap resources than you then sell in your market or resell outside at whatever "value added" price "you" decide.
The problem is that "you" is your Goverment and your Corporations. Now they find a way to get human "resources" cheaper on their global market, so you, the guy on the street, are screwed.
It boils down to what most Americans dont want to hear because they have been indoctrinated since birth against it, but the only solution is to start putting GLOBAL goverment labor laws, salary scales, syndicates, etc. Because without that you are just what the rest of the world is to them, a resource with a price, and they find yours to high . If the global economy is going to be anything else than make the rich richer and screw the rest, it needs a global systems of checks.
Either that or in 100 years the world is going back to feudalism with you being a serf of HP, Intel, Microsoft, etc, because you have to compete to somebody that would be happy to work for food.
Jesus Couto F
Seems like ever time this issue comes up on Slashdot, people reply one of three ways.
1) "Screw you, you lazy bastards. It's Capitalism, compete or shut up. Just like I'm going to do as soon as I graduate from college with my CS degree. I can't wait!"
2) "Let's outsource the CEOs! nyuk nyuk" [about five or six times per thread, always ranked 5:Funny]
3) "Dammit, if they want to work for US tech companies, let 'em come here!"
None of these responses is an effective means of addressing the problem. The Western system of democratic capitalism has worked so far specifically because it harnesses capitalism to acheive wealth and social stability. Notice that I said "harness". Capitalism is a great tool, but left to its own devices it destroys the middle class.
Banning job exportation completely is stupid. The US will quickly lose its competitive edge in IT. Already we're seeing Indian companies churning out quality, high-margin software (such as Flexcube) that's making significant inroads into US markets. When the Chinese start getting warmed up, watch out.
Allowing the exporters free rein is also stupid. It will destroy the US IT industry, put millions out of work, and we'll lose critical mindshare (as all the bright kids who would've become engineers wind up as lawyers). And people with families and other responsibilities DON'T HAVE the resources or time to retrain, you knuckleheaded Objectivist brats. They'll drop out of the middle class and screw the rest of the economy, destroying jobs they might have otherwise tried to retrain for.
Really, what we need are measures to soften the blow of global capitalism. That's what governments are there for. We need controls (but not a ban) on job exports, perhaps a tax-credits-per-domestic-employee plan. We need federal retraining incentive program, giving out vouchers to unemployed people who can redeem them for tuition to get new job skills. And we can take a big chunk of the cash to do these things out of agribusiness subsidies. Fuck Monsanto, the US stopped being an agricultural economy about a hundred years ago. Let's keep our leadership role role where it really matters: in science and technology.
Why hasn't anybody mentioned unions as an answer to all this? Seems we could really use them right now.
We could use them here, and they could use them in India. Unions with some kind of international perspective (instead of the nationalism of the AFL-CIO and others) are the only kinds of unions that can be effective in a globalized economy.
This is why we have to be concerned about the economic conditions of the third world, and need to support their right to organize. Our decent jobs are going to be much less likely to cross overseas and become sweatshop jobs if we give support to people in the third world who are trying to form unions.
You all ran your salaries up way to far, lived outside your means, and suddenly, but bubble burst.
Look at history, the unions did the same thing. They started raising their salaries to a 'livable wage', then when companies went elsewhere to get the labor cheaper, they all started to whine to.
I knew far too many programmers that wanted to command +60K salaries that weren't worth crap. But because companies needed them, and didn't have a cheaper source, they had to pay it. Now, they have an alternative and are using it. Well boo hoo, don't cry in your lite beer too much.
It may surprise you, but Bill Gates and all the other CEOs didn't go into business to give you jobs. They went into business to make money. Get over yourselves, and if you want to be rich, do the same thing. Otherwise, settle for what other people are willing to pay, not what you think you are worth.
I rarely read replies, it's my opinion and if you thought about your opinion a little more, I'm OK with that.
2. CEOs are hiring people who can do the work for the least money. In some cases they get burned by that because it turns out that the outsourced workers are inferior. However, in those cases where somebody can do your job just as good as you for a fraction of the wage... Guess what? You were getting paid more than you were actually worth. C'est la vie.
If the cost of living in the US were the same as India, I'd be willing to be paid the same as an Indian software engineer. Guess what, it's significantly more expensive to live in the US.
I realize protectionism is not a viable long-term strategy. I don't want to steal the potential for economic development from nations transitioning to an advanced economy.
But here's the problem: we are growing production capacity without growing the markets to support them. Everyone would be getting rich and improving their quality of life in this equation if there was a demand from within India for IT work. There isn't one to speak of.
Without such markets to support the expanded production capacity, the benefits of globalization are realized only for corporations -- and they are short-lived. The net money going to workers drops as companies utilize cheaper labor. By shipping capital out of the country to foreign workers who will not inject it back into the corporations' native economy, that economy will suffer, people won't be able to afford services and the corporations will collapse.
The corporations are not really to blame. This is irresistable poison fruit. If they don't take it, they will starve long before their competitors die from the toxicity of the practice.
Protectionist measures are not a permanent solution, but they MUST be put back into place to slow the bleeding. They can slowly be relaxed as foreign markets expand and produce consumers to support their industries.
The hard truth is that there is no shortcut to developing a nation's economy. To do it right takes a slow process. Otherwise all you get is short term corporate enrichment, the establishment of unsustainable foreign labor markets, and the destruction of local economies and cultures.
My dad was (for a time) a home improvement salesperson in the coalfields of rural WV. He said "I knew when I saw the driveways filled with Toyotas and Mazdas instead of more expensive Fords and Chevys that the WV coalminers were doomed to be out of work."
His point was that they were taking wages earned in the American economy and pumping the profits to another country where labor costs were lower.
Today American workers expect high pay (certainly even minimum wage is VERY high pay from a worldwide perspective) and great benefits, but we all want CD players made in China. We can't have it both ways.
If we want to keep our standard of living, we need to choose to pay more for American-made goods. I make a practice of looking for American made goods when I buy, but I know that I'm totally in the minority when I do so. I'll pay more to help sustain my standard of living. I'm hoping that someday soon others will figure that out and start doing the same.
I'm not really expecting that.
The good thing is that overseas manufacturing can be difficult because of lack of infrastructure, and overall productivity is pretty low, making our products more competetive in spite of different labor costs. This is changing and it will be interesting to see the landscape in 20 years....
But Herr Heisenberg, how does the electron know when I'm looking?
[Remember records... they were vinyl (in earlier days, wax) discs approximately 2 to 2.5 times the diameter of CDs or DVDs in which data was stored as a physical groove on the edge of a track spiraling towards the center.]
Offshoring is a good thing. The "lost jobs" in IT are creating a pool of capital (in the form of labor) that will allow the next great step forward to be taken.
Industrialization could only occur on the scale it did if, thanks to increased efficiency in agriculture, millions of family farms went under, sending their labor capital to the cities to work in the factories.
The "information industries" (IT, law, medicine, finance, media, etc.) could only occur on the scale they have over the past 50 years if industrial employment declined (largely because of greater mechanization and also because of offshoring of production). The evidence can be seen by looking at Europe, where those nations that vigorously tried to protect their existing industrial wage bases (through guaranteed employment laws, massive subsidies, etc.) found themselves years behind the US in terms of the state of the "information industries".
Much like the slashdotters complaining about offshoring, the RIAA and MPAA complain about technological changes that, quite frankly, doom their current models, if not their existence themselves. And much like the RIAA/MPAA, these slashdotters are calling for the government to come in and preserve their business models that have brought them prosperity.
Yet these slashdotters, in general, decry the RIAA and MPAA, while failing to realize that they are doing exactly the same thing for exactly the same reasons.
As far as I can tell, this indicates that these slashdotters are either:
What'll it be.
P.S.
The following is an opinion commonly expressed on Slashdot, sometimes with more and sometimes less vitriol. Note that I am not accusing you of making this same statement, or anything like it.
However, when the shoe is on the other foot, geeks who've got those beautifully framed CIS degrees on their wall, are entitled to make money, and have a job, and it's very important for businesses to take a hit on the bottom line for their sake, or for the government to legislate some kind of program or incentive to keep their precious jobs safe.
You may work for somebody else, but you're still a "business." Your business model works something like this:
1. Get CIS degree
2. Market skills to a company for cash
3. Profit!!!
Well, sorry, your business model doesn't work anymore. Businesses have found they can get the same work or a reasonable facsimile thereof overseas for much, much less. Either your price is too high, or your services are insufficient. Now, some will come back and argue that programmers in India or wherever suck, and their code stinks, and it winds up taking more time and and and... So? Obviously it's making sense for the company, or else they wouldn't be doing it. Sounds like you need to change your business model.
We don't have a state-run media we have a media-run state.
This is part of the global fascism movement that is turning the whole world into a corporate slave state. The liberal/progressive way to approach the problem of world poverty and wealth creation is to lift up weaker states with workers' rights and environmental protections so that we can all grow on an equal playing field.
The fascist approach is to destroy or prevent any kind of human rights or environmental protections from being applied in poverty-stricken areas and then use those areas and their nearly slave labor to force down rights, wages, and protections in the US and other free nations so that we go on a race to the bottom.
Don't believe me? Look at the example we just set in Central America:
- Kill a million peasants who try to establish justice
- Sign free trade agreement
- PROFIT! Big time - by sending your jobs south.
Keep fighting for corporate power and watch yourself and fellow citizens become slaves. Your stock market gains won't protect you. Corporate profits are through the roof right now. Is your life any better for it?- Hail to our fearless misleader! Fool speed ahead!
Now, I'm not saying it entitles you to a good paying job, but you shoudl get payed what your worth - and having a college education (notice I didn't say diploma - just because you have a diploma doesn't mean your educated) and working a job that requires such an eduication entitles you to a higher wage then someone just out of high school
I fully agree with you. People should be paid what they're worth. The problem is, what you ARE worth, and what you THINK you're worth, seem to be two completely different things. People with CIS degrees seem to think they're worth $50,000/year, when, in fact, according to the companies outsourcing their tech jobs to India, they're in fact worth something like $10,000/year. Either you need to lower your price, or increase your services.
Your education has nothing to do with how much your services are worth. Your services are worth whatever somebody is willing to pay you to perform them.
We don't have a state-run media we have a media-run state.
> American CEOs, with the willing complacence of their
> bought-and-paid for politicians, are giving them the
> jobs.
Exactly. Fiorina, for example is a Bush supporter, having given thousands of dollars to his campaign according to opensecrets.org. Then she's rewarded by the Bush Administration by raising H-1B caps and reducing restrictions of corporations to move more work offshore. So it doesn't surprise anyone when she flippantly suggests that Americans lose jobs to cheaper workers overseas.
Eventually, middle class jobs will be sent to countries like India, leaving America as the land of the millionaire heir (thanks to the Bush administration for getting rid of the estate tax), the millionaire CEOs, and millions of minimum-wage Walmart greeters.
Well, that's not fair; we'll also have illegal immigrants who get a 3-year work visas but are denied U.S. citizenship.
Insert simplistic political, ideological, or personal proselytization here.
A US corporation can only remain a US country if a majority of its employees are US citizens. So if HP, etc. start employing Indians or Chinese, they should be forced to become either an Indian or Chinese company (and listed on their stock exchanges as well...)
Most multinational companies already list on foreign stock exchanges in addition to their home exchange. Also companies can be registered as a company in multiple countries. Much of this is a requirement of the laws [us and abroad]. Also listing on an exchange is a financial action rather than a legal one. You typically list on an exchange in a country where you need to or you think you can raise funding.
Now here's a counterpoint to your argument. If you want HP or Microsoft and other multinationals to only list as a foreign corporation, the entire US economy would disappear. If a company moves its headquarters to another country, the US government loses out on all the tax revenue from the corporations, same thing as using a tax haven like Bermuda as your corporate headquarters. Many of the large companies have threatend to do this in the past if they don't receive preferential treatment.
_______________________________
"I'm not Conceited...I'm just a realist..."
I'm not a market fundamentalist (i.e. one who believes that market forces always magically coincide with the public interest) but if someone works hard all the way through college and gets a degree in something not very useful, like thermionic valve design, that does not automatically entitle him to a higher wage than the guy who left school at 16 and invested in the qualifications necessary to drive a truck carrying hazzardous goods.
If the market dictates that workers in a call centre earn more than a software engineer with a degree, why shouldn't they earn more? Supply and demand.
Interesting point you make about steel supplies. Only recently George Bush had to back down on his illegal steel tarriffs under threat from the European Union who were preparing to retaliate with tarriffs on goods produced in politically-sensitive American states. The USA's vulnerability is already here, and it's no bad thing. Bush was forced to behave himself, which was good for Europe, and good for America. Only a few special interests (the steel producers) got hurt.
Drill baby drill - on Mars
The same was said of manufacturing jobs. "It's more than just jobs! That's the real products of America! Steel and automobiles and textiles and and and... If you export that, what will be left for us?" The problem is, for the most part, tech jobs these days are the same thing. There's not much "innovation." Tell me, when you're designing a database system for a company, how much are you really "innovating?"
"Well, I came up with the schema!" -- sure, but the "innovation" was the relational database model, innovated some twenty years ago.
"Well, I coded it!" -- sure, but did you write mySQL? Did you "innovate" that? No, you're just using it.
Fact of the matter is, your high-tech "skill" of database design is not much different that the skill of an autoworker installing the drivetrain on a Buick. These days, it's easy to learn, and repetative. That's not innovation.
Thankfully, most of the real innovation is still right here. New standards, protocols, specifications, fabrication techniques, etc, are still being developed right here in the U.S. We still make the tools. You just can't get paid near so much for merely using the tools anymore.
We don't have a state-run media we have a media-run state.
The people who are driving the move to a global economy are large public corporations. The people who believe they will see the biggest short-term gain by using global labor are corporate executives. Their goal is cut costs, increasing their profits and raking in more money for themselves. It's as simple as that.
Part of the problem is these same executives also have the most influence over American politics, which is why trade organizations like the WTO help US corporations, help some foreign governments, and hurt the average citizen (lack of adjusted minimum wage per country, no requirement to respect civil rights in China, etc.). The reason WTO meetings about public policy are held in private is because if the public heard what our politicians were setting up there would be much larger riots and some of these officials would not get re-elected.
So it's not about what you or I want. The global economy is about what the upper class in America wants.
Developers: We can use your help.
OK, so let me get this straight. To guard against "ultimately higher unemployment" we should be firing the local employees and moving the jobs overseas... :-/
I don't still get it. Well anyway, I'm sure that all the people who just lost thier jobs will sleep much better now that knowing that by being unemployed they are doing thier part to combat unemployment.
--
Simon
Ideas don't generally come from the clear blue sky...they usually are built upon something else a person is familiar with. If no IT jobs are here for a person to live off of and stay in the environment where he can see a need to invent something...it will be lost.
That's the basic argument I'm making...
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
The government protects individuals more than businesses, I'd say. If you're an individual, and you're completely screwed, there's welfare, government housing, food stamps, etc. I'm self-employed, and my business is a corporation with one employee (myself). If my corporation fails, the government won't bail it out.
We don't have a state-run media we have a media-run state.
This has happened, over and over, in the U.S., and around the world. I think of my father, who (still) manages to manufacture embroidery in the U.S., but the entire industry has gone to Asia. Did we say that the US competitiveness in the world marketplace was going to go down the tubes because the textile industry went overseas? No.... We might have 75 years earlier, but innovation occured, and new technologies and industries arose.
Now, I know IT is different. But, we do have a tendency to pay very careful attention to what's in the rear view mirror, rather than focusing on what's ahead. Would a steel worker, or steel industry baron, for that matter, have ever predicted information technologies as being a driving force of the U.S. economy?
So, I agree with the poster who said that government's role is to soften the blow of global capitalism, not prevent it. If we had banned exportation, we might still be the world leader in lace, dress making, and steel, but would we have necessarily been the world leader in any other industry, and would that be better?
One caveat: I agree that the U.S. shoudl at least remain self-sufficient in certain areas, liek agriculture, so I have no problem with farm subsidies (in general, not for specific products like corn vs. another crop), especially when so much farm land is being developed into housing.
On a similar note....agribusiness might actually be the future. Without getting in to the whole GM crop issue, I still feel that there will come a time when pharmaceuticals will be grown, rather than manufactured. Whether or not you agree with this isn't the point, as much as we don't know what will be the industry of the future.
How did the U.S. survive after cotton/steel/textiles/etc etc etc went overseas? I hope you don't consider it too much of a cliche to point to a culture that (usually) fosters innovation, that (usually) values education (needs to put alot more money there at the moment, though), and, ultimately, lets those who can make money, make money. By the time an industry is at the huge corporate level, it has already played out, and it is only a matter of time when it goes overseas.
Be worried when education is cut, to save money for defense or for tax cuts (read: California). That is far far more shortsighted....the industries that allowed for uneducated entrepreneurs were exhausted al long time ago....
Why arent these mgmt types outsourcing *their* jobs?
They are.
They're creating large pools of trained, experienced people in foreign countries who, once they've obtained a bit of capital, are well-positioned to form their own companies and compete with their former employers.
Look at how much of the PC industry has outsourced itself to Asia, for example. A few years ago, it was just US companies building component factories in the far east to cut production costs. Next the US companies started buying components from Asian companies. Next the US companies started outsourcing entire products to Asian companies, from design through manufacturing. Now the US companies are increasingly finding themselves trying to compete with foreign products that are going head-to-head with their own.
The next step is what happened to Zenith.
Of course, this process will take a while, so the people doing it will retire with their millions before it becomes a serious problem.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
But the world is not a neatly packaged economically efficient engine.
For example, our trade deficit with China more than funds their defense budget. We effectively pay them to produce missles that they point at us, and to create governmental structures that imprison and torture their citizens without the benefit of due process.
If we look at countries with more open policies toward business and profits, the challenge is that the profits go to the companies not the workers directly.
I concur that people worldwide need our help. I choose to give to organizations that I know provide help and have relatively low overhead costs so that the maximum benefit goes to the people who need it.
I mean you no disrespect, but it seems a bit selfish to say that you buy the cheapest thing available (so that you get what you want) and view that as a charitable contribution to others. Perhaps this is more a reflection on our cultural viewpoint overall than it is a reflection on you personally.
So are you willing to:
a) try to live in the US on the median worldwide income, or
b) relocate so that your egalitarian view of wealth redistribution can allow you to live on what you could make in the developing world?
Respectfully,
Anomaly
But Herr Heisenberg, how does the electron know when I'm looking?