Slashdot Mirror
How India is Saving Capitalism
alphakappa writes "Salon goes onsite to Chennai (Madras) in India to investigate the whole offshoring phenemenon (free daypass) and comes up with an interesting series of stories. Katharine Mieszkowski starts with a company CollabNet which creates collaboration software for teams to work together on projects from locations all over the globe, and has centers in Brisbane (CA,US) and Chennai (India) - a company that would not exist if they didn't have access to engineers from India. She makes the case that in most cases, it is the necessity to survive, rather than greed that has fed the offshoring process. As Behlendorf from CollabNet puts it - 'We saved the jobs of the people who are employed in San Francisco by hiring people here [in India],' he says. 'I don't know that we would be around as a company if we hadn't done that. What was the right thing to do, morally?'"
This is, of course, understandable when it is our jobs that seem to be threatened. It is a self-defeating position though, which ignores the effects of similar movements of jobs in the past. All of those have led to more, better paid jobs in the US (and other outsourcing countries such as the UK). If anything, this is likely to be even more apparent with this cycle: the workers who are affected this time are much more likely to be able to adapt to the new positions that become available. Their skills are more transferable than those of working in sectors such as manufacturing who have felt the brunt before.
The outsourcing boom is often portayed as Indian workers stealing US jobs, and foreign companbies taking US money. This is more than a simplistic view: it has been shown to be factually incorrect. Numerous studies have shown that outsourcing produces a net gain in both the supplier and consumer countries. These gains aren't just the fat cat profits that are denounced on this site, they are in the form of new jobs for US workers: higher skilled, better paid jobs, no less. Last year the consultancy firm McKinsey produced a report that weighed up the pros and cons of outsourcing by US companies to India. Their conclusions? For every dollar spent by US companies in India, there was a net gain of around $1.45-$1.47 to the global economy. Of that, 33c went to India, while $1.12-$1.14 went to the US. The gain to the US economy of US workers redeployed to higher paid jobs accounted for 45-47 cents of that gain. Other studies have had similar findings. So, far from being a case of India stealing american jobs, they are helping the US make gains, and helping american workers get better jobs.
None of this may seem too convincing to someone who has lost their jobs, but it's worth reflecting that the number of jobs outsourced is a tiny number compared to those created and lost as part of the normal economic cycle. It's worth trying to look further than the immediate situation. If resistance to such changes in the past had been successful, we'd all still be subsistence farmers. The lack of jobs now owes more to the current adminsitration's reckless economic policies than to outsourcing.
I've also spoken with other companys' technical support in the UK and other European countries, and it's been god-damned awful.
Seeing as not all western technical support is good, blaming other technical support for not being all good is kinda hypocritical...
Iwant to see software prices drop from this. Instead of corporation pocketing the difference, I was that price savings to go back to the customers. If salaries are going down by 80%, then damn it, I want the software pricing war to start
You see, that is the biggest lie in capitialism (which I am a fan of but...) the fact is that companies don't pass their savings on to the consumer in any meaningful amount.
bzzzzz.. wrong answer. I am able to spend US money in may countries, no problems. The dollar has become an international exchange currency. So, no, they don't have to eventually spend it here.
I also believe that with international banks... they covert stuff back and forth, with not real currency involved at all.