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IT Outsourcing Need Not Threaten Our Future
Xeo writes "The topic of the moment in a lot of people's minds is the outsourcing overseas of 'white collar' jobs. While many people are perhaps rightfully worried about this, there's an editorial on the subject that tends towards the other direction. It makes some very interesting points on the whole idea of outsourcing and what it means for the US at least."
Well yes, as I have maintained in the past, outsourcing does not present a strategic long term concern for the US. Sure, there are certain jobs that shall be relocated or executed from remote locations, but even if one looks at the current trends - anything that remotely involves creativity or innovation is not going anywhere
http://efil.blogspot.com/
The assertion that jobs are being outsourced because there aren't enough people in the USA that have technical credentials is BULL SHIT.
Try telling the guys with PhDs that can't get jobs that there is no talent in this country.
Why don't you embrace your slashbotness instead of living in a dreamworld?
This is an article about how Americans see themselves -- or rather, about how the author would like them to. It does not appear to actually touch on the economic realities (good or bad) of outsourcing.
Yay for fluff.
However, it is quite interesting in the American self-image that it pushes. While Americans are indeed diverse and tolerant, I think the remarks on innovation (which I hear often) could do with a little consideration.
Whence? Hence. Whither? Thither.
While there is outsourcing taking place, people neglect a major factor of why there are less and less jobs... efficency.
Employers are benifiting from workers doing more work than ever before, and this is spured by all sorts of automation and technology. With more efficient workers, need less workers. And after economy goes down, the pressure is on to push the efficiency further.
OK, I'm supposed to be working, but everyone likes to blame politicians and the tech bosses. Why do you guys never consider the fact that its technology itself that is helping to drive you out of jobs?
As my reference, check Newsweek of a few weeks ago. I'd find it, but I gotta run.
America's technological strength is based on innovation.
I would say it is partly based on innovation.
One huge advantage that the USA has in most areas of business is a huge, practically borderless, single market containing almost 300 million people. The benefits of this can't be understated, and it's something that other countries can't completely emulate (although in Europe we're trying to create a single market, we'll always have the issues with different languages and cultures).
I think commentators often overestimate the advantage that the USA has in terms of the greater capabilities of it's people, and also are blinkered if they think that other countries can't achieve greatness as well.
IT outsourcing doesn't necessarily threaten the US economy in the long term but it does in the short term. It'll be like when the manufacturing and steel industries moved overseas to Russia and Japan and elsewhere. We as a civilization will figure out how to make new industries and replace jobs.
You'll have that sometimes...
Most people argue that "when we outsource one sector of work, the country advances and most of our people go into a greater field of work, above what they were doing before".
In other words, we outsource production/manufacturing jobs and then we become a service and information based economy. But the problem with this NOW is that you're not talking about putting a bunch of assembly line workers out of jobs and making them go to school and learn something. You're talking about forcing educated, professional people who have often gone into debt to acquire their educations or people who have technical skills but no on-paper-degree out of their work as the work is shipped overseas.
It's one thing to tell a guy who runs the bottle-capping machine at 7-UP that his job is being shipped overseas and he's going to have to go back to school and persue college toward some sort of office job or higher technology job. It's quite another to tell someone who has spent a decade or three building their white collar career or a person who spent four or more years in college, then building their career and dedicating themselves to a particular field that now they're going to have to go back to school all over again (sometimes after just having graduated and gone into debt a first time) and learn something new...
Sure, maybe it's great for the country overall... but it sucks ass for individual people in the meantime. It fucks a whole generation over.
A point I think the article misses on, and a fairly important one, is the current education system in the US. While problem solving (vs. memorization) is still the focus of education here, it's not as enforced as it was in the past.
I have family in several states in education and most agree that we're turning out fewer problem solvers than in the past. None seems to have a solution, outside of parenting (or lack thereof), which I think is the leading killer of a solid education.
What used to draw innovators from other countries was the freedom and opportunity found in the US. Both of those seem to be dwindling. Where does that leave us?
I think we're also in for a lull in innovation in the US, which is scarier to me than the trend in offshore outsourcing. I've been a professional developer for 13 years. Although I haven't been affected yet, I have to assume it will affect me sometime (hopefully later than sooner).
With three children, I am the math and science homework helper in the house. What I find is my children are taught tricks and workarounds rather than an understanding of the fundamental math problems. I'm glad to help my children, and love seeing the light go off in their head when they actually understand the problems they work on. So I have this idea. When I "retire" from development (forced or otherwise) I'm going to become a math teacher, preferably at the middle school ages. I've worked in math my whole career, and have had a wonderful experience with my own children (I know, teaching 25 kids is completely different). I think if more people were to go into teaching towards the end of their career, and in a field that matches their respective career, we would be turning out more innovators and maybe worry less about the future of the working world in the US.
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
it'll be like when the manufacturing and steel industries moved overseas to Russia and Japan and elsewhere.
The one problem with stuff like this is letting business move anywhere it damn well pleases is is better for both economies concerned on a broad scale, it can really fuck over specific areas for a long time. I'm definitely better off with cheap foreign steel, but Scranton, PA for example is pretty much fscked.
I don't think that IT outsourcing is going to create blight areas the way mill closings did - MCSEs have a lot more options than assembly-line workers. But I wonder. A lot of Lisp people still haven't got over the AI winter, even if it was largely their own fault.
Google confirms: Ruby is the world's most beloved programm
Slight problem here. Germany and Japan are certainly not known for their lack of innovation, while in many areas the US is notorious for its lack of precision and continuous improvement of products (missiles and other ways of killing large numbers of people being obvious exceptions).
America's biggest strength is nothing so vague and ephemerous as "creativity" and "ethnic diversity" (unless by ethnic diversity what you really mean is the disproportionate number of advanced science and engineering degrees given to non-Americans), it's just size of the population and access to wealth (raw materials, energy sources, etc.)
As global economies and improving technologies make these strengths less important as compared to such things as precision and continuous improvement (not to mention a highly educated populace and a sane top leadership), I think that the future of the US will become a very different one than what happened there in the 20th century.
CC-licensed translations of Japanese fiction: http://tonygonz.blogspot.com/
OK so we're saying that "we're good at innovation so we'll be okay" - but where is the evidence?
What have we really innovated in software in recent times? Windows? From a user perspective little have changed since Windows95 (from an engineer's perspective little has changed from WindowsNT3.1!)
Linux isn't an example either (firstly it's non-commercial, second it's a rewrite of Unix - the change is more social than technical).
I guess the browser is THE standout example - now how long did it take for that to become a commodity item? Not long. In software innovation is hard, but refinement is easy. I don't think that this "innovation" thing is going to protect us (even if we are "better at it" and I don't see any evidence to suggest that we are anyway).
The real issue here is the massive disparity of wages in the "global economy". American workers (and British, like me) can't live on the wages that Indian workers can, money here doesn't go as far (Indian workers are getting wages that are generous for the region - they are doing well). So we simply cannot compete - what is required is to attack the root cause of this - the disparity of the buying power of money across the global economy, because this outsourcing ISN'T a sign of the health of the global economy it's a symptom a massive distortion in the market.
Of course how you do this is difficult to see, but THIS is the end that we need to look at. We need to be VERY careful how this is done, because large and rapid corrections would be catastrophic to Indian workers and they deserve protection too. But shipping IT jobs (and hence skills) to off shore locations isn't smart in the medium term. Indians aren't stupid, if they are doing all the technical work, why will they be happy to report to foreign management forever?
I don't believe they will, Indians can be just as enterprising as anyone - they will have a ready work force of skilled workers, trained by OUR companies, it won't be hard to motivate them to set up on competition with US companies (stock options, maybe?)
It seems that we're underestimating the skills and drive of the Indian people, this is a fundamental mistake.
If we REALLY want to make the "global economy" work we must correct the distortions within it. I'm sure that the we can compete with India (and other emerging regions) if this is done (it won't kill the outsourcing, but at least we'll all be on a level playing field). Don't think I'm underestimating the Indians, I think they are as capable as any of us, and I think companies that are massively outsourcing either don't understand this OR the decision makers are not concerned with the long term (only short term profits).
No news here. These are MBA-type CEOs that love to ruin people's lives because they can't lie enough to keep customers happy but screwed. The kinda guy who thinks he's a success because he's filthy rich, and who can't understand he needs people. He can't grok that people want to do something instead of bloodsucking like him. So his company lacks an Y-shaped career path.
Contrast this to Germany where CEOs are engineers.
Leandro Guimarães Faria Corcete DUTRA
DA, DBA, SysAdmin, Data Modeller
GNU Project, Debian GNU/Lin
In the words of Homer Simpson "You're living in a dream world...".
Innovation costs money. Bleeding money off shore through outsourcing until the common guy on the street can't get a job is not going to help scientists and engineers innovate. The more you lower the standard of living in a country, the less people will be concerned with innovation and the more effort they'll need to spend just to stay afloat. Eventually you will simply bring the standard of your own country down closer to the level of the countries you outsource to.
Outsourcing to another place where people work like slaves for peanuts just to keep themselves from starving is evil. Period. You reap what you sew. This BS WILL come back to haunt us all.
Everyone who genuinely wants to work should be able to make a living. If they're willing to make a gigantic effort they should be able to expect proportional rewards.
Sammy
These posts express my own personal views, not those of my employer
Are Europeans more or less creative than Americans?
Yes.
Does this question make sense?
Possibly, but it's probably the wrong question.
Simply being American does not make you more creative. Nor does it make you less creative. However, there could be a cultural aspect, which encourages innovation, and makes people willing to take a risk on a new idea.
When I talk to CEOs about the career paths of the engineers in their companies, they say that many reach a career plateau very early, often after only five years. This happens not because of any technical deficiency, but because of a lack of "people" skills such as communication and teamwork. Moreover, engineers often come up short when they have to deal with people from different fields, such as manufacturing and marketing.
How enfuriating! This CEO sycophant would have us (engineers) believe if we improved our social skills we could all be executives and all would be right with the world. Bunk. Corporate management structure is about the few controlling the efforts of the many. The structure is not imposed through democratic means - CEO's don't run for office. Neither is the structure merit based. (What do you think about the review process at your company?) It is based on ambition, alliances, and persuasion. Climbing the corporate ladder is considered by some to the the ultimate competition. To me the game resembles musical chairs more than anything else.
One of the reasons the free software culture appeals to so many in this forum is that those who have reached a "career plateau" can bypass the rigid heirarchy of the corporate world and express themselves professionally though writing software. No management required!
an ill wind that blows no good
1) HVAC work 2) Carpenter, Electrician, Plumber. The rise of HGTV, This old house, etc has created a demand( artificial?) to do $10,000 remodeling jobs. People spend more money redecorating than our parents did. 3) Painter 4) Ceramic tile/ carpet Hmm do I see a trend?? We, in the "High Tech" are in a big trough. The "next big wave" hasn't started yet. Lets face it . The transistor is 50 years old.We are a silicon based industry. Silicon has become a commodity. We are all in a commodity business. , not unlike the Iron, Steel, Steam , Plastic and Coal industry before us. Once the general public (circa 1989) knew who Intel was, the handwriting was on the wall.
As long as the cost of living (and therefore the cost of labor) is higher in the US I believe corporate America will continue to outsource. Anyone who thinks efficiency or innovation is primarily an American product probably has a bit to learn about the rest of the world.
A subject that hits close to home for me is outsourcing support operations. I work for a fair-sized federal agency and we're currently looking at consolidating Level 1 helpdesk operations from 13 separate helpdesks to one outsourced agency to serve the whole organization.
Current industry standards say that for an organization our size a helpdesk call should cost the company ~$20. Outsourcing to India would cut that cost in half, so it's easy to see where that option would be attractive to big business.
Support operations do not generate income, therefore offshore outsourcing reduces operating costs. IM frequently less than HO corporate America's first loyalty is to stockholders and unfortunately altruism doesn't increase the bottom line, so I think companies will continue to outsource until there's a financial incentive for them to quit doing it.
I don't think code written in the US is necessarily more innovative than code written in India for half the cost - so until third world IT organizations raise wages it's still gonna be more attractive to outsource.
I think the bottom line is that wages for skilled American IT workers will continue to slip unless they're in a job that cannot be outsourced - I just suggested to my son-in-law that if he wanted a job in IT the place to be was probably in networking - preferably telecom or Information Assurance. Those fields will probably remain for the most part in the good old US of A ;-)
we see things not as as they are, but as we are.
-- anais nin
India has just a had a federal election with a suprise win by the left. It seems that alot of Indians have not seen improvement themselves despite a hugh growth in there own economy. This is hardly surpising given the level of poverty present in that country - India is a country that is never going to have a standard of living even close to that of a western country. Meaning that outsourcing is here to stay unless these new guys attempt to wind back the clock to what it was like in the the early 90's (ie no technology whatsoever). Which is not realistically going to happen.
Anyway getting back on topic - outsourceing has it's source in explotation. Indians are no better then programming then Americans. The best argument for this is that England has a massive Asian community, many of whom must have been through the humanities are for wimps and try to think as little as possible Indian educational system. Yet I don't see jobs moving from America to that country. Do you? In fact the English software industry, which has always been strong (see Bullfrog, Sinclears etc) seems to be shutting up shop. If Asians where better at programming then its only natual that you would expect a revivel of the English software industry.
Outsourceing is all about cheap wages period. And 9 women to carry a child for 1 mouth thinking. It will continue unless Americans can match those wages and this just isn't going to happen, because, like I said before India does not have a wage correction function present on there side.
What we are seeing is the selling out of the many by the few. For ultimately short sighted gains - if all jobs go over seas then then American econonomy will ultimately collapse.
Trying to stop outsourceing is like the RIAA trying to stop music downloading. This article just reeks of someone going down to the sea when the tied is turning and saying they ain't going to get wet.
And I for one welcome our Hindi overloads, hell the last couple of bollywood movies I've seen haven't been bad and no worse then most of the crap that seems to come out of hollywood these days. The foods good. And seeing how you guys run a war just makes me glad that in the future you might not have as much money to spend to the lastest WMD's.
Sure, maybe it's great for the country overall..
What ever gave you this idea? Look at our economy. Even the talking heads have trouble describing it as the end of the recession, and they usually like lying to us.
And everyone seems to forget that their are no new fields to go into.
Not only that, but you have to have lower level jobs in every country.
If you follow the logic that pro-outsourcing folks use that "people are going to move up the job ladder" eventually everyone will have to have a Phd and 20 years of experience to get a job in any field. It's become a big pyramid scheme: there are only so many places at the top and innovation can't open up an infinite number of new fields.
Why don't you embrace your slashbotness instead of living in a dreamworld?
One thing that most CEO's are probably not taking into account is that while they are saving money in the short term they are also supplying their furutre competition with money and technical skills. I know of one Indian company (InfoSys) that has already opened offices stateside and started competing directly with some of their past customers.
I would not be surprised if some enterprising young developers overseas were to take the money and the skills that they aquired from working on code from software companies in the US and put together (for example) a enterprise-level RDBMS and begin selling it globally for a fraction of the cost of Oracle or SQL Server.
Joke if you must, but a friend of mine with a Masters in MIS (you CS folks can stop snickering now) spent the last few years unemployed. She finally found a job - as a full-time waitress. It used to be that wannabe actors in LA were all waiters/waitresess, looks like the future of that profession is former IT workers.
Many corporations interested in outsourcing spend lots of money on public relations to quiet down the concerns of the public who are affected. There is plenty of research on how outsourcing negatively affects individuals and not just the people who lose their jobs. It takes no genius to see how and if you dont want to take the time to identify and read scholarly books on the why and how you can see a movie like "Roger and Me" that can demonstrate it without getting into the heavy economic aspects.
If your read the article again you'll notice that all of the points are really just conjecture and not based on any large scale samples nor has it proven itself historically. Remember all those hardware engineers back when companies outsourced PC manufacturing, factory workers when they outsourced to sweat shops, etc, etc. Look at alot of those cities now. Its happening again to the Software Industry and all those who were planning to have a living working in that sector. The only people who do well will be those jobs that can't be outsourced or obsoleted (yet), management, and of course the owners who always come out ahead. DONT BE AN IDIOT and believe such nonsensical articles. If nothing else it just takes some common sense.
some of the growth industries in the US now are defence related, and the "justice system".
Jobs in the future for kids now inside the US will be soldier, prostitute, house maid, gardener--and that car wash example. About like that it appears. Tongue in cheek but it's roughly true, too.
They got all these kids now faked out they will be a sports star or a rock star or something, or some other job along those lines. It's pretty sad when those are the best paid jobs to strive for from societal brainwashing. It's obviously the most interest that the vast majority have. You can fill a stadium -or multiple stadiums and venues really- with 50,000 people any given weekend near any medium or large US city to watch some game or get entertained with some various music, but you're *lucky* to get 500 people to a political conference even occassionally. Ya, I just invented the numbers, but I think you can see the point.
IF "globalism" as they push it now was so successful, then WHY are we now the worlds largest debtor nation, when a bit over 20 years ago when all this big push started we were the largest creditor nation? If it was supposed to make the nation all this loot and be successful, where's the beef? They keep claiming it's working, and the numbers keep proving them wrong, so they say we need MORE of their schemes to make it work. It's nuts. There's the big lie staring at us, along with we now have the highest incidence of mortgage defaults since the great depression, personal bankruptcy is at record highs,pension funds in both private and government are in the most serious problem levels, and so on. Can't even think about the ponzi scheme social insecurity is, that's gone for most practical purposes.
Nuts, it's a series of big lies. This "new and improved" system is designed to transfer even more wealth to the upper 1% of the population that is already the richest and most powerful, and it has to come from someplace, and that someplace is the US middle class, because that's the only other place it exists in the fist place, it's the last place they can steal it from, so there ya go.
-- I speak only for myself
A teachers salary might be fine as a supplemental income, but earning $28,000/year as the lead bread winner isn't going to cut it. I can't imagine ever owning a house (or decent apartment, depending where you live) and/or having kids solely on a teacher's salary. But everybody's dream is different I guess. Perhaps you dream of living in the lower-income part of town with no TV and Walmart dialup?
Research and innovation needs money. Research money goes to industries that make money. There was no profit in going back to the moon so nobody did any more efforts to get there. So now we want to go to Mars we don't have the technology we would have if there was money in it.
It's all a bit sad really. And surprisingly, military research (death science) has blossommed into many technologies we use today (hint:Internet) because there was money in it.
-+-+-+-+-+-+-+-+-+-+-+-+-+-+-+-+ "Shadows are as important as the light" - Jane Eyre
This isn't just about helpdesk muppets, though, this involves everybody. If all American companies decided to cut costs by sending jobs elsewhere, no one would have any money. There would then be two options: Create an infinetely growing gap between the lower an high class(no middle class), or move to a communist society(refrain from soviet russia joke), which no American politician would ever allow.
Money dosen't grow on trees, and without it, the economy cannot survive. Although no one has the right to have a job, it is almost a requirement for living in society. So how about this; rather than sending the jobs to India, we send the dumb-asses who aren't working hard enough to Antarctica?
It is worse than than most think. And industry groups like this are trying to hide the hard facts. Tens of thousands of workers are out of jobs that they have spent many years learning. I personally know two people who were laid of last year and have not found work. They are spending their retirement money waiting for the economic tinkle down. Others have had to take jobs at 50 - 60% of their former salaries. Millions of people are under-employed.
These are dark times for the middle class. And it will stay that way until we have regime change and leadership that understands we cannot hemorage the millions of jobs without becoming a third world country.
If *all* jobs are filled by machines, then mankind can go play all day. Sounds good to me. We'll do the jobs we like because they're fun and let the robots have the rest, a la _Voyage from Yesteryear_. I can spend my days writing code that pleases me instead of beating my head against a wall trying to figure out how to make someone else's code do what we need.
I'd say the other reason that people aren't afraid that *everyone* will be replaced by a machine is that there is so much human activity left which we still don't understand to any significant degree. Show me the "master architect algorithm" or a function which correctly models customer satisfaction, or a machine that can win souls for $DEITY. You can't emulate it if you don't know how it works. I believe that that day will come, but we are not positioned to see it, even if it arrives tomorrow.
Richard K. Miller,
President,
Franklin W. Olin College of Engineering
This is a school that is funded by the Olin Foundation, which is one of the largest funders of anti-labor causes in the US. The Olin's are multi-millionaires and fund to the tune of millions a year causes that are the most strident in screwing workers and helping millionaires and billionaires. There are not many wealthy American families on the front lines of what they must perceive as a class war as them. The only other ones I can think of are the Coors family, and to some extent Richard Mellon Scaife.
I read through this article and what is he saying? Nothing but a lot of bullshit. But other people here have mentioned that so I'll just throw up a red flag about who he's connected to (and paid by).
I should also mention that if there's a "problem" they'll always say it is American workers versus Indian workers. As if we're in a race and have to compete - working longer hours for the same amount of money, improving our skills so we generate more profit for the bosses and so forth. What is not mentioned is overwork, that if American workers and Indian workers got overtime pay, unemployment would fall (as people would be cut down to 40 hours work per week), and wages would rise, since supply of IT labor hours would shrink, increasing the price.
I am really tired of hearing the bullshit. The problem is not with the IT workers, we can administrate and program just as well as we could five years ago, if not better. The problem is with the people who control the capital, and their broken-down economic system which has the sole purpose of making profit for them. The only way to fix anything of this for ourselves is to talk to other IT workers who are of a similar mind (which there are many of), organize together and do something together. The sum is greater than the total of all of the parts. There are already nascent efforts out there working towards this, we just have to join up with them and push them along.
But what good does it have to add new, innovative engineers to the labor pool if there are no jobs for them and VCs aren't interested in funding *real* innovation that doesn't match the latest set of new/hot buzzwords?
The other point is that yes, we have real creative artists in the engineering field. However, to develop them to the point where their skills can produce new inventions of the sort which will benefit us all, these people need starting points for their career paths, i.e. entry level programming, electrical engineering, etc.
These are exactly the jobs that are going overseas.
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