Slashdot Mirror
Why Offshore When Canada's Next Door?
Roblimo writes "A study by accounting and consulting giant PriceWaterhouseCoopers claims Canada could lose up to 75,000 IT jobs by 2010 to offshore outsourcing, but could also *gain* 165,000 jobs through U.S. outsourcing contracts. The trick is, according to this story at IT Manager's Journal, that while Indian, Chinese, and Russian programmers may cost 80% less than U.S. programmers, the time zone, language, legal, and other problems involved with sending work half way around the world can eat up much of the labor savings, while Canadian programmers are nearby, speak English with nearly American accents, have a similar culture and legal system, and get paid 40% less than U.S. programmers. Might be time to think about moving North, eh?"
I work for MSN - MSN which is not offered in Canada, but most of the tech support sites (or so it seems) are located here in Canada.
I am not willing to move north to get a job that pays 40% less than what is available here. I'd rather work outside my field.
excitingthingstodo.blogspot.com
I work in the US about 5 hours from the Canadian border and I get paid about 40% less than the average US programmer.
canada does not have an outsourcing industry set up let alone the companies to outsoruce to. remember that sales and marketing is required as well as a cheap pool of labour. indian companies agressively market services in the US, while being able to retain a large pool of engineers on the bench (since labour is cheap).
this alone make the difference. in canada you would have to pay engineers $40 CDN an hour while in india is $4 CDN or equivalent. this allows more engineers to sit on the bench, allowing faster scale up.
As a Canadian in the IT industry, I'd be glad to see more jobs coming here, definitely. There really is very little difference between Americans and Canadians, besides cultural and political systems. None of that plays into how you sound over the phone, or how well you code.
Canada really is the ideal place for US companies to outsource. If you have a Roadrunner cable modem and have ever called tech support, chances are you've been talking to someone at a local Ottawa firm called Convergys. I bet you never knew it, either.
occultae nullus est respectus musicae - originally a Greek proverb
Outsourcing to Canada has been going on for a while, mostly because of Canada's trusted status in matters of security. Even the evil Haliburton corporations big clusters are now living happily in Toronto along with dozens of others. I should know - I installed them - (and my karma aches for it)
Everyone talks about first-time unemployment claims, but very few take the time to track what happens to the unemployed over time. Ditto for outsourcing projects. Most of the ones i've heard of or been involved with were ultimately cancelled due to incongruent labor laws, time differences, language barriers, quality control issues, et al.
HBI's Law: Frequency of calling others Nazis is directly correlated with the likelihood of the accuser being Communist.
Indian programmers cost 1/4th the amount typically paid for an American programmer. A 4:1 bang-per-buck ratio.
What outsourcing firms wont tell you is that you're also buying into an average 6:1 loss in productivity. American coders are better educated, and have more experience -- This results in _better_ quality code that's produced _faster_ than their Indian counterparts.
Sure, you're saving your company money, but you're also taking an enormous hit in productivity. Your offshore project is putt-putting along at 15 MPH when the rest of the industry is doing the equivalent of 10 over in a 65 MPH highway. By the time your product hits the street, your competitors are already dominating the market AND working on their next release.
Something to think about.
I'm an american who HAS moved north up to Montreal to program (games for that matter), and cost of living in the city here are less than where I was in NY (Poughkeepsie), and if I were to move just 30 min outside of Montreal, cost of living would drop more than 40% less than where I was in NY, probably in the order of 60-80% less.
For example, a typical, 2500-3000 sq ft house around Poughkeepsie (Hopewell Jct to be specific) went for about 300-800k USD. A friend of mine bought a 2500 sq ft (ranch) house 15 min drive from down town Montreal for 140k CAD, with a pool and a very nice neighbourhood.
140k CAD is aprox 100k USD(at about 70 cents to the canadian dollar). So by this rough (I am sure prices in Hopewell have soared even higher), at worst the price is 66% less, and at best upwards of 88% less than the US counter part in that area.
Is it worth it? Thats for you to decide. I know I have more disposable income, even when converted to USD.
I do have the added benefit of being a dual citizen, but that is a minor issue. As long as you have a degree and a letter from a company stating you have a standing job offer in Canada, it's a matter of going to the border patrol office and they will do a little paper work (from what I have been told, less than a hour) and you are all set.
speak English with nearly American accents
This quip really made my day. Now I know that accents vary over North America, but the idea that the "Canadian" accent is distinctly different from an "American" accent is really laughable.
Compare a New England accent to a Southern accent to a Maritime, to an Ottawa valley, to who knows what other region. Accents vary by much greater degrees within the two countries than they do between them. Or do most Americans feel like Canadians all talk the same, and that is somehow different from all Americans? I'd love to hear opinions on this... Cue South Park quotes now...
Half of them think we are Evil
"God fights on the side with the best artillery." - Napoleon, Marshal of France - speaking truth to power
Listen, I understand that being forced to train your outsourced replacement or you get fired anyways is completely unfair and cruel behavior by the big corp's. But outsourcing isn't entirely evil. For one thing, it means that there is *much* cheaper labor out there ready and willing to be the "code monkey's" who can slop together some PeopleSoft, C/C++, and SQL code to keep the big business CRM tool running. And if companies in the US are so willing to look half-way round the world to get such jobs done, it means there's more relevant, interesting work to go around for those in the US.
Not to mention the fact that freeing up millions of dollars the company is currently spending to invest elsewhere can only be good in the long run. Yes, I know your job might be eliminated in the short term, but that doesn't mean you can't get back out there and learn new skills or take on a completely different job. No one ever said that living in America was a free ride. We've all gotta work hard to make our living here. More money being pumped back into our economy due to outsourcing will, IMO, continue to raise stock prices, make the rich richer who will in turn spend their money on more frivolous products, which drives business further ahead. Besides, when the mega-rich have more 'stuff' they need more people to upkeep it, which is a good place for the poor and unemployed to get themselves back on their feet in the short-term so that they aren't wasting their earning potential in the long-term.
The down side, of course, is more tax. And the CBC.
My wife has family all over Canada, and I can tell you that from their experiences, the healthcare system isn't all that great. While everyone has coverage, it can be pretty tough to get in to see a doctor. Things take longer because their system is swamped. And I remember something about how the banking industry isn't that good up there, so you don't get decent interest rates. Or something like that, I can't remember. I just meant to say that it is no "wonderland", they do have their own issues.
But damn, are they polite up there. We went there on our honeymoon, took a 2 day tour on the Rocky Mountaineer. When we were pulling out of the station in Vancouver, there was graffiti sprayed on a nearby overpass. What did it say?
"Welcome to Vancouver".
Cracked my ass UP. Victoria was absolutely beautiful, I would move there in a second if I thought I could find a job.
My beliefs do not require that you agree with them.
I think that is somewhat of an exageration. Having worked for the mexican government and lived in texas. I find the canadian levels of corruption and waste quite low.
I find that people often lack context when they make these accusations. 100% honesty and integrity does not exist anywhere. its a human failing and realistically any government, regardless of its checks and balances, is prone to it by virtue of the humans that comprise it.
As a developer who's been in IT since the early 90's, I've noticed that as the number of Indian and Chinese managers grew, so did the outsourcing of work to these countries. In my opinion, these managers sold the idea of outsourcing to these countries to the upper management and have a lot of input on where the outsourcing will go. There are not as many Canadians, Mexicans, Central Americans, etc in management, so there's not so much outsourcing to these countries.
Where I live in Illinois, the cost of living is:
And my city is slightly above the national average for cost of living.
(a) finangle a job offer from a Canadian company, which of course will be conditional on you getting the permit
(b) show up at the border with the offer letter, your resume showing a couple years' experience, and proof of your education, and
(c) convince the border worker that these docs are legit and, very important, that they are consistent in their content (trying to take a sysadmin job with an English BA will be problematic). Then
(d) start work, find the beer store and buy suitable seasonal clothing, in whatever order suits you.
The hardest part is (a). But keep an eye on workopolis.ca, and be prepared to cover your own travel for interviewing and relocation.
S.
According to a recent U.N. report Canada is the 4th best place to live, above the USA.
To say you would make 40% less is a gross exagoration. From what ive seen, the payscale is pretty much inline to what most of the states is. The amount of money that you take home at the end of the month means squat. Its all about standard of living.
:) ).
:)
As an example, im in London, Ontario, which has a population of about 350K. Im a fairly high level developer, basically one step below IT manager. I pull in about 60K a year. From my understanding, I could go to New York city and basically double my salary, and have a 10% less tax to pay. Ditto, I could go to Toronto, and make about the same almost double what I make now ( more like 40% more ), but really what does that money buy me.
I am in the process of buying a luxury loft, 1,700 square feet in size, for about 150K. From what I understand, the same would cost me about about 400K in Toronto, and probrably well over 1/2 million in either NY or Cali. After, expenses, taxes and all that crap, im probrably left with about 1,500 a month of disposable income. That includes my mortgage, car payment, getting reamed for taxes ( that part aint a myth
As to currency differences, to be honest, I dont really see any. When I go visit our Lansing site in Michigan, I pay basically the same as I would in canada when I eat out, get a hotel, order a beer. It used to be we could cross the border and save a ton of cash on things like gas, smokes, groceries, etc... but now, thats no longer true. Actually, I have a friend whos business consists of buying vehicles in Canada, and driving them up to the States for resale. Gives you a hit at how the exchange rates work
There are plenty of reasons to chose one country over the other... but wage sure isnt one of them. Cost of living/standard of living is the most important thing... wage is... when comparing one location to another... just a useless number.
COmpanies used to use child labor util we made laws about it. Companies used to work people round the clock until we made laws about it.
This is not generally true.
The labor laws that we have are designed to prevent outliers cases. Abominiations and whatnot.
For example, by the time the civil war in the United States rolled around, a large number of plantations had started or already completed rolling back slave labour. Why? It is expensive. By the late 1800's, a number of factories in my home state (Maine) had limited the average work day, instituted minimum working age, and improved safety conditions considerably before the trend of unionization took over.
Why?
Because in the end, businesses are all about the bottom line. In the short term, sending unprofitable things and expensive things offshore saves the bottom line. But in the long run it is bad for business: bad for consumers, bad for the image of the company, etc. We are in the early phases of the outsourcing IT cycle. Some companies will go over board, some will do nothing, some will go down the middle. The ones who go too far will be burned, the ones who do nothing will be burned, the ones who choose just right will win.
until we unite and make a law about it
Yeah, that's what we need! Yet another protectionist law!
Somehow I don't think a few more lines of law on top of the 110 million we already have are going to solve all of our problems...
I know that a company can save ~40% in salary just by moving there operations from either of the coasts to the Midwest or South. I can speak specifically about South-West Ohio where wages are at least 35% lower that the NE or the West. Plus you get the advantage of no language barriers or import/export costs.
Here are three Canadian tech companies that produce products I use at work everyday: Miranda, International Datacasting, Broadview Software. Nice to have NAFTA and not have to pay tarrifs!
My sister-in-law works for a company that contracts to MSN and MCI. The average hourly wage is $9 (CDN). She lives in a small town in Canada, but $9 an hour is still hard to live on. Her employer was recently quoted in the paper as saying that they view these jobs as secondary incomes and that people should therefore be happy to be making any extra money, or, in many cases, to have their first Canadian job (if they are a foreign-trained engineer, for example). In other words, the employer feels that white men have "real" jobs and that these C$9 an hour jobs bring luxury to the lives of women and immigrants. Ouch. This so-called "secondary income" employer is the main employer in several small towns in Canada. The jobs aren't secondary -- they're the only game in town.
-- SYS 64738 --
You talk of speaking french as some sort of disease...
It's not the plague you know; as a french speaking IT worker I can say that most of us speak at least enough english to be functionnal in the workplace. As for non-IT workers in Quebec it's another story. The thing is, english is basicaly a necesity in computers since most litterature and jargon associated with CS is english. We do have some lousy translations for things like E-Mail (Courriel), Software (Logiciel), Freeware (Gratuitciel) but they never really got momentum as far as common use goes.
You may lose 40% compared to US dollars but you don't lose anything when comparing quality of life.
;)
You gain free universal health care, safer streets, lots of water, better beer and you get to live in the homeland of the most famous TV and music stars