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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.'"
"We've found a way to line our pockets with more money, so why shouldn't we use cheap, hard to understand overseas techs? We're greedy, plain and simple."
I'm not american, so I can't comment on what the loss of jobs in my field their is going to do to me, but I think this kind of thing should be expected if anybody wants the global economy thing to really happen.
This could still be beneficial to the american economy, it just means that many of these out of work programmers should look into some of their own ideas and start companies around them, hiring out to the cheap labour overseas. That would probably benefit more people anyways.
Lets face it. If you're a multi-billion dollar corporation and you can get labor dirt cheap in another country wouldn't you do it? Yes there are plenty of qualified, educated American workers. So what? They work for $3/hour in India instead of $20/hour in America.
We need some kind of regulation to discourage these practices or our entire economy will go to shit. George Bush wants to help ILLEGAL immigrants out by letting them work? Because he is so compassionate?? Give me a fucking break. It is about exploiting people and getting cheap labor so the rich get richer.
If you reduce her salary to $500,000 (ten times what a sacrificing $50K engineer might make), you can save 2290 well paying (50K) jobs.
For the life of me, can you imagine any CEO contributing as much to a company as 2290 rank and file workers? Unless they can literally print money, I have trouble imaging how an executive can make that kind of contribution compared to the employees they lead.
"Prepare for the worst - hope for the best."
The quote about what workers in the US cost reminds me of this article from Fast Company:
...
:)
http://fastcompany.com/magazine/77/walmart.html
The article makes a believable case that WalMart is singlehandedly, drastically, speeding up the move of manufacturing jobs overseas. Towards the end, they have this quote:
'Ever-cheaper prices have consequences. Says Steve Dobbins, president of thread maker Carolina Mills: "We want clean air, clear water, good living conditions, the best health care in the world--yet we aren't willing to pay for anything manufactured under those restrictions."'
That's exactly what's going on here. 'Middle class' in the US costs a hell of a lot more than 'middle class' elsewhere, and if consumers here have a choice, they will buy the things that were not made under those expensive conditions. Of course, by making that choice, we push our own jobs overseas
I can't predict how this will end up, but it's going to be a trip finding out. What do you all think? I want to see I Am An Economist in the replies.
Not the only place where India is not playing by the same rules we are. See my sig.
It's no damn wonder India can pay minimum wage for tech jobs, half the freakin' country is slaves and most of the other half is 'untouchables' forced to work for next to nothing.
Carly really needs to explain how she personally and HP feel about supporting slavery.
I'm not sure what the secret to success is, but the secret to failure lies in trying to please everyone -Bill Cosby
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.
This is interesting, because it seems to be in stark contrast to the comments in the story about U.S. workers being unwilling to work for less money. That suggests to me that there are still the same number of jobs in this country, only now they pay smaller salaries, and after some period of time the executives decided that U.S. workers were unwilling to accept those smaller salaries.
The thing is, as you pointed out, this is not what's happening. There are in fact fewer jobs available, and the salaries are the same (ie, not lower).
Perhaps a good summary of the article might be: "Well, we're doing the usual blind executive thing, making lots of decisions that we can't really justify to the public because our reasoning is shaky and unfounded. So please just leave us alone and give us the freedom to wreck the U.S. high-tech job market as we see fit. Thank you."
The investors choose a management team to take care of their capital and run the company with a profit. If the management team is payed a flat salary, they have no incentive to make, say, 15% instead of 8% profit. Their incentive is to keep their jobs, theoretically by doing the minimum necessary. If, however, their compensation is tied to the performance of the company (through growth targets, stock options, etc), the executives have a personal financial interest in maximizing the value of the company, and thus (in theory) the share price.
I guess the big flaw in this is that no other member of the company is compensated the same way, while arguably an engineer has the same influence over the success or failure of the company, at least on a small scale. If it works for the executive, why not the front-line worker? The only answer I can think of is that there is no "procedure" for being a CEO. Everything that the company does is a calculated risk, and management requires a high degree of customization. Maybe without this compensation there'd be less incentive to take risks, while the last thing you want to tell your front-liners is to take risks. I'm not saying it's a good answer, but it is all I can think of. I'm open to other ideas. Thoughts?
Wake up, dude. Not only can you not live on minimum wage (even with two jobs), there is the added concern for college costs. Education cost money. It isn't like a blue collar job where you can get along on a high school diploma that's free to get. In order to get those white collar jobs, you need a diploma that will cost you on average some $80,000 from a decent school to get. That isn't free, you have to pay back loans. You can't do that on minimum wage. 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 (which is probably the minimum wage standard). How many good doctors work for minimum wage?
You can't get by on minimum wage (that's single - forget having a family), you certianly can't pay school loans back on minimum wage, and you definitely can't send your kids to college on minimum wage. Someone with a college education that works for minimum wage insures that their children probably won't even make it to college. As it stands the system cannot support itself. The avergae us worker cannot compete against a guy who only makes $10,000 a year. And foregt this baloney about balancing out lifestyles and setting us eqaul to the rest of the world. You want to know how the rest of the world lives? Read "Nectar in a Sieve". That's where life styles are going to balance out. The way things are going, BladeRunner would end up looking like paradise. The reality would be more like the slums of south america or africa.
There's a growing sense that even if The Future comes,
most of us won't be able to afford it.
-- Lemmy
While I would agree with most of your post regarding overpayment, execs on each other's boards taking care of each other, etc., there is a big difference between CxO's and IT personnel.
There are very, very few people qualified to run major corporations, compared to the positions available. That's just an unpleasant fact. In IT, particularly after the job losses of recent years, the situation is more a buyer's market.
Oh, and given the fact that business is a highly competitive endeavor, it isn't possible for all execs to do a "good job". There will always be companies running into the ground as their competitors move forward. The trick, however, is to ensure that the chief doesn't earn $zillions unjustly along the way (see Gary Welch of Conseco, for example).
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Now, admittedly, in US currency that's ca. $6500-$7500. But consider: Rent around Bangalore is 6,000 Rupees per month. That's $131 dollars a month. A good computer in India costs 30,000 Rupees or $656.31.
These are not people at the poverty level. They are self-respecting middle-class IT workers. America's cost of living (which drives the computation of minimum wage) doesn't apply.
Sigmentation fault - core dumped
if every company was run by people like Aaron Feuerstein, the CEO of malden mills, the maker of polartec fleece, the world would be a much better place. talk about putting your employees, the real people that make the company, first. his factories burned to the ground in lawrence, mass, a small not so well-off city. instead of taking the money and shutting down the company, he continued to pay all the employees their normal salaries and rebuilt in the same city. he not only gave the employees their fair wages, he also kept the economy of that city going. i don't think there are any others like him. the company went into bankrupcy and is now back out.
the problem with most companies is they see their employees as expendable. he didn't. he saw each person as someone that brought something positive to the company that was irreplacable. he lost a ton of money because of it, but he didn't care what happened to him, his company and employees were more important. that's a guy taht knows what he's doing. most will continue to raise their salaries. i would also like to compare the government to this as well. the senate recently voted a salary increase for themselves, something that is far greater than the cost of living for them (including all their travel to and from DC). they voted it in during the economic downfall, how convenient, people lose jobs, but they get higher pay. same goes for the governor of CT, my home state, john rowland. he gave himself a raise while the state's economy is in shambles. it's really greedy and stupid and really pisses me off. i don't see it changing anytime soon, hopefully the government won't listen to the schmucks that run the big tech corporations and put restrictions on their doings, or at least raise taxes on the companies that outsource to other countries.
please me, have no regrets.
I wish I could find it, but sometime recently one of the business rags had an article in it where it was found that you could replace the CEO with anyone off the street at random. The stock price would briefly dip, but would quickly rebound as though nothing had happened.
As for making sure the chief executive doesn't get (Nobody EVER earns $5 million a year and a $40 million golden parachute) an excessive amount, there are options: 1. Pass a law saying the federal and state governments cannot do business with any corporation where the CEO recieves more than Xtimes what the average or median employee earns in a year, whichever is lower. 2. Graduate the tax system more--make it less worthwhile for the company to give out huge paychecks as the CEO will recieve less and less of each dollar spent on their salary package as the amount gets higher and higher. 3. We have minimum wage laws, we can impose a maximum wage law. I like the idea of 1 and 2, but 3 I don't care for. While it is bad for our republic to have such wealth and power in the hands of so few and the concomitantly huge gap between the rich and the poor, it just seems wrong to say nobody can get paid $x million a year. But until we have campaign finance reform it's a moot point since no laws will be passed seeking to limit excessive executive pay, since they donate money to election campaigns and money plays a critical role in politics.