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Growth in Indian Offshoring Slowing
quantumstream writes "CNN/Money is reporting that high wages are causing some software companies to look to other countries for outsourcing, including Eastern Europe and several other SE Asian countries. Gartner Research believes a drop of 45% in India's share could happen in the next two years. Is this the beginning of the end of the dominance of India in the tech offshoring market?"
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India is being outsourced? That's ironic.
Note to mods: I'm probably being sarcastic.
From TFA:
"Four years ago, a typical call center employee would have earned between 5,000 to 6,000 rupees ($114- $136) a month. Now it may be up to between 7,000 to 9,000 rupees ($159 - $204) a month," he said. "The rise in labor costs isn't significant yet. What's more important is that these increases so far have not been passed on to clients in the U.S."
now i will have a plethora of accents to learn, and i already have a hard time understanding american.... :(
In a global economy, there will always be someone able/willing to do it for less money. Eventually those who were the go-to people are undercut. And then the undercutters are undercut. And it so on, and so forth. Eventually a global economic equilibrium is reached, where the price is the same everwhere.
When price is no longer the main factor determining where to outsource a project to, the focus will shift back to quality, maintainability, and so forth. Indeed, it is quite possible that the future software industry will appear very similar to that of today's automotive industry in terms of multinational competition.
Cyric Zndovzny at your service.
Who cares? The key here is the companies are still looking at OFFSHORE outsourcing. Doesn't matter from the U.S. "Average Joe" standpoint what country it ends up in. It's still "somewhere else".
disclaimer: I work in the outsource call center industry. Although I am not fully opposed to offshore outsourcing... it's disheartening to see people you know getting laid off so that their job can be sent overseas for cheap labor.
"why don't you just slip into something more comfortable...like a coma!"
Let's see, we need a place where people speak English, there is a significant number of people who know something about computers, and the wages are even lower than in India.
Given the plethora of 419 e-mails that evade my spam filter, how about Nigeria?
Quality of life standards are improving, driving up labor rates, and most of the "easy" outsourcing has already been done. Outsourcing larger development projects ends up not saving as much as expected because of the added management layers that are needed here and there to ensure a successful project.
Jerry
http://www.cyvin.org/
With companies constantly looking for new ways to increase profits it was only a matter of time before they found a place cheaper then India. And in theory it is only a matter of time before they run out of places to find. As more countries make the transition from 3rd world, the people living there will begin to realize they are worth more then the $5,000 a year they are making. Hopefully one day it will come back to the best person for the job gets the job, no matter where they are geographically, or how expensive they are
I love to deploy my packages
What's more important is that these increases so far have not been passed on to clients in the U.S.
Well duh, after all we never saw the drop in prices thanks to switching from hiring people for $1000 a month to $120 a month. I'm sure they won't raise prices until they hit $500/mo.
As with any disruptive mechanism, the original value proposition is driven lower and lower to the point where it is as commodity as the market it surplanted...I am thinking a dot.bangalore crash may be just around the corner. And we are yet to see the real long term negative effects of short-sighted, cost driven offshoring.
a number of business sites are saying Latin America is the new India for outsourcing. They have similar timezones to U.S., speak English, and are even a relatvely short plane trip away. Who knows, might be a more attractive spot to immigrate to than south asia too, for those willing to follow the work
Folks..
Lets not kid ourselves here, the poor developers in India are exploited. The average salary is around $390/month, the kids down at the local fast food joint here in the US make more money than that. Sure the cost of living is a little lower over there, but things like books, computers etc, still cost the same or more than they do here.
I've worked with several out-sourced Indian teams, and to be honest... you get what you pay for. Just like everywhere else, they have good programmers and bad programmers. Unfortunately, the nice people in India have a tendency to what to "please" you, so instead of giving you accurate, clear-cut information, they tend to tell you what you want to hear.
They also have very little motivation, unless they are working for a big company like IBM, which has a reputation for a solid career, most developers aren't going to pull the allnighter or get the job done to meet the deadline.
Out of about 30 code reviews I've done for Indian teams in the past month, I would say I've turned them all back for one coding mistake, bad design, or flat out not fixing the problem. The quality is poor.
I've also spent time building teams in India, and its been pretty much hit and miss. Some teams do great work and are very successful, other teams spend their time trying to negotiate to do less work and have longer times to complete projects, to the point where we've just dropped Indian teams and finished the work ourselves.
Outsourcing costs more than its worth, better off hiring some students and getting two or three good developers vs. 20 bad ones in a different time zone.
Cargo ships and decomissioned aircraft carriers to be converted into mobile call centers! Will dock where the wages are lowest!
People want something for nothing, and are willing to enslave others, then justify it to themselves because they're "saving" these people from poverty.
Only one place those goddamn cost cuts are going. Into the CEO's pocket.
We need to cap CEO salaries to something like 4 times what their best people on the ground earn. Don't think it can work? Check out Korea's ship building industry.
Capitalism and a "free" market are all well and good but it's not a perfect system and there do need to be controls.
These posts express my own personal views, not those of my employer
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
Yes, you are correct.
I was in Romania and Bulgaria recently. There are very few if any computer laws there at all. I remember my hostel in Bulgaria. They had a computer in the room for internet access. The internet itself was so slow, you could have almost considered it dialup. However, it didn't come over phone or cable, but cat5. I don't know how they get ethernet service to each appartment building, but I immagine it would involve WAP's on the roof.
Anyways, while browsing was slow, you could get any single album, movie, game, or piece of software at speeds of 1-2 megaBYTES per second. Why? The ISPs cache the files on their servers and distrubute them over ethernet. They don't have to fear legal reprocusions, so they do it.
I was just getting good at understanding the Indian accent when I was calling Tech Support!
Strange women lying in ponds distributing swords is no basis for a system of government.
Water flows downhill...
Seeing bad movies only encourages them. Watch responsibly
it occurs to me that it was "trendy" to outsource to India (and managers basically fabricating lies about how much money was saved and how quality was maintained), will it be "trendy" to move outsourcing *from* India? The U.S.of A provides the lion's share of India's outsourcing income and I could see a cascading collapse of major portions of the economy over there ...
"India raked in more than $2 billion of an estimated $3 billion global ... market."
"the worldwide offshore BPO market will grow to about $24 billion by 2007 of which India will earn about $13.8 billion."
So with massive market growth India might slip below 50% market share if they don't watch their back.
But it's not like they're stocking up on pink slips in Bangalore.
The world will not get better through technology. We must seek to be better people.
Life imitates art. Or at least Outsourcing.
*** Sigs are a stupid waste of bandwidth.
Are they also taking into account changes in exchange rates when they are calculating the dollar cost? The figures stated look like they are basing the dollar cost in todays dollars(since the ratios stay about the same), but could it be that 6,000 ruppees buys more dollars now than it did 4 years ago?
Monstar L
Canadian wood? I wish. The tariffs on Canadian lumber are massive. This is a blatant transfer of money from the American home owner (who has to pay more for lumber) to the American forestry industry. It's a fine example of hurting the many for the good of the few, and why trade restrictions both suck and blow.
1. Some "consulting firm" is involved in a study instead of some non-profit organization.
2. When that firm is Gartner, who've been known to make all kinds of outrageous claims to get publicity.
3. They come up with nice, easy numbers like "Gartner Research believes a drop of 45% in India's share could happen in the next two years." Anyone who've done any research or studies, knows that numbers ending in 5 or 0 don't have special meanings in reality. The only thing that it matters to are readers, especially PHBs. What this suggests is that Gartner just pulled some number out of a hand to get more publicity, again. 45% is much easier for a PHB to rattle off than 73% during a meeting.
I have no strong feelings about this "news" either especially coming from a source as unreliable as Gartner. The trend is probably true but the number is probably bogus.
EvilCON - Made Famous by
Offering someone a job, even at what you consider to be a crappy wage, isn't enslavement.
It isn't necessarily a bright idea either. A hefty chunk of the really smart people overseas tend to emigrate to where they'll get paid nice wages. Managing projects on the other side of the world, through culture and time-zone barriers, isn't very easy. Clueless PHB types at big companies are torching resources by following this outsourcing fad but it's very difficult to outright sink a huge corporate ship, short of pulling an Enron. Our clue^H^H^H^Hfearless MBAs are trying though.
What we should do is make it as easy as possible to start and run businesses. Pass the Flat Tax so we won't have to waste so much time and money figuring out how to comply with the tax code. Heck, that step alone would give a huge boost to small businesses who can't afford platoons of tax attorneys and accountants (and "donations" to Congressmen to encourage the writing of favorable tax loopholes). Tort reform would be nice too.
Make it easier to start businesses and the dumb ones won't be able to stay in business so long.
Well, the irony of Canadian wood is that you Yankees want it, but you just don't want to pay much for it. And now you're flouting a treaty and keeping an ill-gotten $5 billion. Other countries in negotiations with the US over free trade agreements pay heed. American politicians are corrupt servants of industries too incompetent to compete.
The world's burning. Moped Jesus spotted on I50. Details at 11.
Lately I've been finding myself routed to South America for customer service (Motorola for one). I hope this is a trend because the general knowledge, english skills, politeness, and service is LIGHT YEARS above India. When I get routed to India for IBM or Dell, I'm more likely to get hung up on. My South American service with Motorola was so good I started asking where they were from. Argentina and Costa Rica. I guess the front line is Argentina and the actual support is in Costa Rica. They were great to talk to and if anything, overly polite.
Also, take the recent big articles in New York Times and Fortune, calling out for MORE subsidizing of fundamental technology, because corporations can't develop it themselves. It's so costly and unprofitable, the public must subsidize the costs and risk, so private companies can privatize the profit.
Normally it's not widely admitted, except when politicians like Bush start shifting the subsidies around, making enemies.
Protectionism is just a tool. Whether it's useful (and for whom) depends on the situation.
A recent study (I was one of the contributors, plug admitted) was done by a Dutch University. The link to the website is http://stitch.ewi.utwente.nl/detail/chakra/-page=e n-info.htm, but to be honest I don't know if the results are currently online.
Not sure about the rest of your comment, but it sounds mostly like anecdotal evidence and opinions tend to be subjective. I disagree with this particular excerpt from your comment, though.
Convering salaries directly my multiplying/dividing by the exchange rate without taking into account the Purchasing Power Parity is plain ridiculous. To sum it up for you, PPP is used because:
The PPP measures how much a currency can buy in terms of an international measure (usually dollars), since goods and services have different prices in some countries than in others.
Goods and services cost an order of magnitude less in India than they do in the US. For example, a loaf of bread costs about Rs. 10-20 (about 0.25 - 0.50 USD). Monthly rental for a pretty spacious house would approximate to Rs. 10000 (about $250). Those are rough figures, and will differ by region, but a single software engineer (for comparison purposes, since I'm single too) could live *comfortably* in a metro city like Bangalore for about Rs 15000 (including food/rent/groceries/booze/other_expenses). That works out to about 50% of his average salary of about Rs. 30000. Ofcourse when you convert his salary to USD, it comes to only about $750, (which wouldn't even cover the monthly rent in most areas in the US) and causes you to gasp, go hyper and claim "OMG, they're exploiting software engineers" or "OMG they're stealing our jaabs by working for less".
In the end, the major cost saving for companies is *not* the lower salary (as you claim fast food workers in the US get), but about the *Exchange Rate*. Poorer economies have a lower cost of living than more developed counterparts, and hence have a weaker currency against the US Dollar. This multiplication/division factor allows companies to earn in USDollars and pay in Rupees (or any other weaker currency) thus widening their profit margin. So please ponder over these finer points before spreading FUD/incorrect information and basing other (consequently erroneous) axioms on an incorrect assumption. Thank you.
An Indian-American Hindu committed to non-violent thought/speech/action alarmed by the global explosion of radical Islam
Offering someone a job, even at what you consider to be a crappy wage, isn't enslavement.
So if you say "here do this work, otherwise you'll end up poor and starving" isn't enslavement? It isn't far from it if you ask me. The only decent option is to ask someone else for a job, but if everyone in a position of power is offering the same conditions, guess what you're back to the same conditions: work for me or die.
At the very least this is servitude. You do get some choice in who gets to be your master.but honestly I don't think it's that far off enslavement.
These posts express my own personal views, not those of my employer
Protectionism is mostly a tool for making certain industries profitable at the expense of everyone else. It takes a brave and enlightened government to resist the urge to throw up trade barriers. The Bush administration isn't one of them.
I've been working on a little theory that the whole outsourcing phenomena is reflective of a much deeper economic problem that's been developing in the U.S. over the last 20+ years.
The last great bout with price-inflation in the U.S. was in the late 1970's, after Nixon cut the dollar's theoretical gold-peg (theoretical, because only foreigners could redeem dollars for gold), and while the economy was absorbing all of the dollars that'd been "printed" to pay for the Vietnam war.
Paul A. Volcker, chairman of the Federal Reserve from 1979->1987, solved the Inflationary crisis of the early 1980's by hiking interest rates to obscenely high levels. His entry in the wikipedia says that inflation was reduced from 9% in 1980 to 3.5% in 1982. The cure wasn't easy, however, as it induced a recession and much joblessness. It was thought that Reagan was going to be a one-termer.
Anyways, today is like the 1970's all over again. We've had tons of newly printed money spewing out of the government since about 1995. First it fueled the dot-com bubble. The government opened the money-faucet even wider after 9/11. The effect of having more money in the economy is that prices go up for scarce items with high demand. Hence we have home prices that seems to grow without end, and the price of oil going through the roof.
The difference between the 2000's and the 1970's is that Giant Corporations seem to think they have a way out of paying American workers the increased wages price inflation forces them to demand: outsourcing.
Remember Little Boy George's hundred-billion $ economic stimulus package that got passed soon after 9/11? In decades past, Americans (er, USians) would've taken the money and gone out and bought products built buy other Americans (USians). Those producers would take their profits from all the sales and use them to invent new things to sale, and new American factories to build them in. Closed circuit, stimulus gets recycled in the economy over and over again.
In the new system, Americans take their economic stimulus to go out and buy stuff "made in china" And profits from that sale allows chinese entrepreneurs to go and build a new factory in China. Open circuit. So Georgie Boy's stimulus package went around once.
There's nothing wrong with trade, so long as it's a two-way street. But at least in the last 4 years, Americans have been buying goods from China, and the chinese have been lending the dollars they've made in the sale back to us, to pay for our illustrious leader's silly little jihad against self-induced terrorism (See Harry Browne's When Will We Learn [part 2], and his other 2001 articles for what I think is a lucid explanation of how the U.S.'s foreign policy has lead to the problems we face today).
Getting back to the subject at hand: the primary problem is not that there's a trade imbalance, but that the Federal Reserve's willy-nilly printing of money allows the imbalance to grow much much larger than it ever could otherwise. In hard-money times, if China accumulated an excess of dollars, those dollars would become worth less in world trade. Chinese products would become more expensive for Americans to buy, and American products would become cheaper for the Chinese.
But as it has been, the Chinese pegged their currency to the dollar (hence, no relative adjustment in the value of the two currencies), and that was just fine for Georgie, 'cause the chinese bought plenty of U.S. bonds to pay for his silly little war.
I think i'm rambling now, so I'll quit soon. My main point is that Giant Corporations are outsourcing today to hide rampant 1970's-style inflation from their customers.
Outsourcing is also done to prevent the natural "leveling of the playing field." In a closed-circuit economy, if no one want
Learn the rules so you know how to break them properly.
www.teslabox.com
So if you say "here do this work, otherwise you'll end up poor and starving" isn't enslavement?
That's not the offer. The offer is: "I'll pay this much for this work." If the person to whom you make that offer doesn't want to do it for the price you're paying, then he goes and works for someone else. There is competition for labor, even in India.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
I think it is because the products are cheaper. Costs have come down and continue to come down. Dell is all about economy in large scale. Look at memory prices for an example, they have dropped like a rock and there is very little manufactor support required for them so the savings was not from cutting support costs.
Getting off topic here to your post but along the lines of the article.
I personally think the bottom level support systems of any large company are completely useless. They might as well have no support structure at the lower tiers. They would serve the customer at the same level and not have to pay for something that is useless.
A recent example with HP.
To start off. I had a dead IP Console switch (16 port IP KVM). It was completely dead and the power led was not even on. When I finally got to the right department, the first level tech refused to acknowledge there was no power. He wanted me to upgrade the firmware and call back. I repeated that the device does not even power up at all, no fan, no power led and it is impossible to upgrade the firmware. He asked what firmware was currently on the device. When I said I did not know has asked me to connect a server to it, power it on and read the firmware to him from some menu after the device was done booting. I repeated that it does not power on at all. He finally understood after I described what the product actually does and what it was for, hello, it is a KVM and it is DEAD. Okay, new one on the way...
HP like many other companies has a system in place to send you emails about the status of existing open support tickets. I recieved one about the replacement KVM I was to recieve but it was noted to be on backorder. In the email I was given a link to inquire about the new shipping date. The link took me to the HP self serve web site. I filled out the form with all of the case information and asked when my part was going to be shipped. The result of the web request was another email asking me to call the 800 number to inquire about my shipping date. What the hell was the purpose of that exercise? I called the number (1800-HPINVEN(T)), and the voice system had absolutely no options for IP Console Switch, KVM or anything I could possible use to describe the product. It said I could use "OTHER" but it only actually understood the word "OTHER" after saying it at least 5 different times. I was transferred to bottom level support to describe my problem. I supplied the case number and the person asked what product I was talking about. I asked her to pull up the case number and see. She does not have access to case numbers so I had to describe to her what the product was. She had no options for IP Console switch or KVM and I finally asked for the server group. Finally, after 12 minutes I was at level 2 in the server side, an english speaking person (unknown location but at least sounded like he was a native english speaker with a southern accent). Regardless of where he was, he pulled up the case number, knew what the product was, had some in stock and I recieved the new one via overnight morning delivery.
I know everyone has their own tech support nightmare stories but my point with this one is why even have a tier one or general support line at all? More often then not, it is 100% completely useless and gets you nothing. I guess the status quo keeps them there but they could save even more money getting rid of them entirely.
Bad boys rape our young girls but Violet gives willingly.
I visited Bangalore a couple of years ago, and talked to a bunch of people in the IT industry there. They were already starting to realize that the outsourcing business is, basically, working for wages.
The real money is in developing a property income. Look for a wave of Indian software products, developed from their own designs. A couple of years later, look for the same thing from China.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
I'm waiting for the revolution... That's revolution as in wheel, not revolution as in speech.
Heres the road map:
US workers are too expensive so US companies outsource jobs to India.
India becomes too expensive, so they outsource to Russia.
Russia becomes too, so they outsource to [another country].
Repeat ad nauseum until...
[Mid. o' Nowhere] becomes too expensive, so they outsource jobs to... the US.
I will call this assertion More's law. I propose that this cycle will double in frequency every 18 months. It will be become so rapid that every country in the chain will only add 1 character, then only 1 bit.
This will continue until no real work will be done. There will be an infinate loop of new contracts circling the globe every few hours. The only way to break the loop is run out of lawyers. The matrix was so close, it was actually lawyers, not robots that envslaved humanity. Now we know, so we can stop it.
We care less if it's in India, Vietnam or Europe. When will they ever come back to Mainland? Is it possible ? No.
The BPO definition will widen from call center to urine and blood sampling to stock research and auditing.
Adding to American woes is the dick-head immigration policy where we are neither getting enough graduate or P.hd students nor the ones graduating are working here.
Ultimately, China and India will de-stabilize the economic balance created and get richer. Lets accept the fact and begin to work harder or perish.
Trust Microsoft/Trust ManagedCode!
India = Indo-European languages.
True, but the Slavic languages such as Russian are also Indo-European languages, and they can introduce just as much of an accent barrier as anything else. What matters is not the lineage of a language as much as how its phonology differs from that of English.
African and Semite languages are about as far from Indo-European as you can get...
Afroasiatic languages are more closely related to Indo-European languages than are, say, the Uralic-Altaic-Japanese-Korean superfamily or the Amerindian superfamily. Go look up "Nostratic" to see how (comparatively) close Afroasiatic languages are to IE.
Dude,
I don't mean to be harsh here, but a job is not property. It's an exchange of your labor for money, and if your customer can get the work done cheaper, he's entitled to do so. Bottom line: it's his money, not yours.
That being said, I took a look at monster.com and found over 1K hits for "tech support". If that's what you want to do, there are lots of places looking for support people. They may not be in your town, they may not be at the wage you used to get, whatever, but nobody *owes* you anything that they haven't committed to in a contract.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
Well if anything, it makes things even more expensive (for India) because 4 years ago, it was about 49 rupees to the dollar. Now it's about 43 rupees. The more you outsource, the more the excahnge rates rise, the less revenue Indian outsourcing companies get, the less lucrative outsourcing becomes, yada yada and yada.
As an Indian working in India, I've been screaming myself hoarse about this, and how America really doesn't have much to fear from outsourcing - because wages/costs/value of rupee is rising a lot faster than jobs/wages are falling in America. So eventually, say within the next 5 years, it won't be worth it to outsource to India. Now some people think that it just means things will be outsource to China or Kazakhstan or Sudan..but no.
1) China's GDP per capita is already much higher than India's. This means (in very inaccurate, general terms) that a chinese worker is ALREADY more expensive than an Indian one - coupled with a MUCH higher exchange rate - so the work will NOT be shipped to China.
2) It won't be sudan or wherever because India's main advantage is ENGLISH population. Sure they're not speaking as perfect as an American (debatable point actually), but there are more people speaking English in India, than in China, or the Philipines or wherever - in fact the World's largest selling English Daily is published in India - the Times of India (I'm not including a link to it because the f-ing site is bloated with spyware, and one of you poor souls might actually still be using IE!). There's that and the fact that India is 10-12 hours ahead of a US time zones. This is one reason for the efficiency - providing 24 hour customer service to Americans is easy if for 12 of those hours, your customer reps are actually just doing a regular 9-to-6 in their own country.
So again, there some particularly unique factors as to why India has been successful. Once our economy picks up, outsourcing on the *relatively* large scale will slow, or even drop greatly. Plus, in those 5 years, America will also move on in different ways (incomes won't rise or may even drop, yyou guys will find some alternative "growth" industry to keep you going, allowing retrenchment of unemployed software engineers/call centre workers, e.t.c).
My Favourite Meme
The issue here in software programming which is skilled labor as opposed to who has the fanciest manufacturing plant.
It's a fallacy that electronic hardware manufacturing does not require skilled labor. Sure the people running the machines don't require alot of skill. But essentially they are the equivalent of call center people. Those factories also need:
Technicians - Maintain equipment
Mechanical Engineers/ChemE/MatSci/EE - develop machine processes, techical documentation, troubleshoot complex problems
Industrial engineers - layouts, material flows, production improvements
Business educated people - manage supply lines
Other college educated - managerial, training, quality,etc.
D6 63 0D 70 89 81 BB 8E 7B 7C 5F 5D 54 EA AB 73
Economists don't take into account the huge national security risks that globalism presents.
Bingo. Economists still haven't figured out a good way to put externalities into the equation. If the goal of the country is to increase next year's GDP at all costs, then listen to the economists. The externalized expenses of increased unemployment numbers (the real unemployment numbers, not the crap the Labor Dept. puts out), stagnant wages, and increased costs of living have been largely absorbed by increased reliance on credit (thanks in part to the housing bubble). None of these figures puts any red ink to a balance sheet, so why should the economists care? Their job is to serve the holy God of The Market.
As of late, the GDP for the US has been growing rather well, but, for some reason, the rising tide hasn't lifted all boats (or if you prefer, the pie is getting bigger, but only the top 1% are getting a bigger share of the pie). According to supply-side "trickle-down" economics, this isn't possible. Apparently self-interest isn't quite working out the way it has been theorized to work. I have a feeling that when China decides to stop subsidizing us, we'll find out that our economy (and country) has been bankrupt for years.
Oh yeah, speaking about their English accent which probably might be their third or fouth language, how many languages can you speak without accent? Stop looking down at the third world countries. You are not any better....
Okay, I have to address this one. I have quite a bit of experience with Indians and their somewhat limited mastery of spoken English, both from tech support as well as a TA I had at an American university.
First, I'll say this: often their grammar is superior to the average American's. I have no doubt their written English would exceed that of many American's. And I fully understand that English is probably not their primary language. You ask how many languages I speak without accent. Just one...English. I can speak broken Spanish with what I would assume is a horrendous accent. But do you want to know something important? I do not try to offer technical support to Spanish speakers, or try to teach at a Latin American university.
To be fair, most English-speaking Indians speak much better English than I do Spanish, so the comparison is not absolutely fair. But if I cannot understand them, the effect is the same. I am actually impressed by the number of languages many non-Americans speak. But if you are trying to teach a class at a university in the US, or trying to offer tech support for a US company, and you cannot be understood, you are not accomplishing the job you are being paid to do. This actually bothers me less in the tech-support example, because I can always just call back later and try to get a better representative who I can understand. But in the education example, it is often a choice of staying in the class and hoping you just don't even need any help from the instructor (or ever need to understand what they are asking/telling you), or dropping it and hoping you can pick it up later. And hoping that you aren't in the same boat later. And you're paying a lot more for those credits than you are for tech support.
And it isn't necessarily racism. I've had a white European (German, specifically) TA I could barely understand as well. And if companies switch to Eastern European call centers, the problem will likely be the same. I cannot tell the color of your skin over the phone. But I CAN tell if I can understand you.
And yes, if I went to a street in Bangalore and rounded up 10 guys, I'm sure 9 of them would be smarter than our president. Hell, one or two might even be more effective speakers (in English) than our president (ever heard the guy talk?) Most of us are not trying to say than Indians, or anybody else from the countries being outsourced to, are stupid. Just that their English is damn near incomprehensible.
Nor do they take into account the fact that labour isn't just a drain on the company profits, they're also the people that buy the stuff that companies produce. I have yet to see an economic positive in making it so that your customers are unable to afford your products.
Does a Christian soccer team even need a goalkeeper?
I'm in an MNC operating out of India. Being part of the workforce, I know pretty well the wretched condition Indian coders work in. Our training is inadequate, faculty is of poor quality, resources are lacking and we are always in a hurry. No wonder India has never produced a world renowned software product. At this rate, it never will.
So if you say "here do this work, otherwise you'll end up poor and starving" isn't enslavement?
Enslavement is when a person is owned by an other, and can be bought and sold as property, as well as raped, tortured or killed at will, just as you would be free to destroy any other property.
By contrast, offering someone a job is at worst pointless. If the prospective employee doesn't find the offer better than his current situation, he can always decline it. At best it can improve someone's life immensly. At the utter level of poverty many third worlders live in, a few cents more a day can be the difference between life and death.
Have you bloody BEEN to Japan recently? Because I think you're overlooking a hell of a lot of things about the Japanese culture and economy. Here's a few:
1. Most cheap goods in Japan are produced in China or Korea nowadays, and most lower-level work is done by Korean and Chinese immigrants who don't have citizenship, even though their families have been there for generations. These people have been moving up in the economic food chain, but lack the solid ties to Japanese society that citizenship would help bring.
2. Japanese secondary schools are rapidly going to shit; teachers get assaulted, students don't pay any attention, and other than the entrance exams, the material covered is not terribly difficult. Japan needs a major dose of education reform.
3. Japanese workers used to have employment for life in the 80s; now, the only lifetime workers are government employees. This has caused mounds of social problems, doubly so because everything in Japanese society is based on seniority.
4. Better educated and more competent? Japanese work twelve-hour days, getting eight hours of work done, because their culture demands it, and afterwards, those Tokyo salarymen go out and drink and smoke as if cancer and liver failure were going out of style. Even if a younger employee has good ideas, they are overlooked because of their age, and the amount of pure ass-kissing that happens is beyond belief. How would you like it if you *had* to go to your boss' house and fix his bratty son's computer, for no pay, and you can sleep on the couch because the trains stop running at eleven.
Don't get me wrong. Japan's not a horrible place, but it's no paradise either. Their big advantage over the U.S. is that the younger generation is disgusted by most of the things I've listed, and fortunately, Japanese education is still very science-centric (unlike the American school system). So Japan stands a better chance of reinventing themselves; but make no mistake, they are not in a happy position right now.
Apologies about my English, as got back from Japan a few weeks ago, and I'm still not quite adapted to being home.
--
I Hit the Karma Cap, and All I Got Was This Lousy
These are nothing but lame excused against outsourcing. Lets be rational. Today hundreds of American companies do business worldwide. You sell Coke, Pepsi and BigMacs throughout the world. In a similar fashion these countries are using their human resource to do business in America or Europe. The point I am trying to make is that it is very natural for different companies in different parts of the world to compete without intervention from the governments. And I guess an average Joe from America just wants the government to intervene. It goes against the spirit of a free market.
Regarding accent I just can not take it that it is incomprehensible. And in call centers in India they get rigorous training on this. And apart from serving the American customers these centers support customers worldwide. When I make a call to some call center to enquire about my flight, I donot expect someone will speak in the same accent as I do. As long as I can comprehend it, it is good enough for me.
Lastly I heard Slashdot is a website about new technology and inventions. Slowly it is becoming a platform for expressing grievances for American programmers. That's not what it is intended for. And this is not at all interesting for readers from other countries. Lets grow up guys. Lets put topics on it what it is intended for. I have nothing against American programmers. I use to work with lots of American programmers and I appreciate some of their abilities as well.
Not really the case.
1) The Gate Gourmet workers were British citizens of Asian origin (mainly Sikhs I think)
2) The part-time staff were temps employed through Blue Arrow, presumably legally resident and employed in the UK.
The Gate Gourmet staff went on strike at the use of the temps. This is was not the legal process for striking,as opposed to being illegal, they commited no crime but lost the legal protection they would have had if they had called a ballot. The management then summarily dismissed them(plus workers on holiday and off sick).
Staff at BA, who had worked with these people for years and many were relatives, then went on strike. Again this was not legal.
The outsouring issue here is the relationship between BA and GG, nothing to do with the country or nationality of the workers.
Regarding accent I just can not take it that it is incomprehensible.
Whether you "take it" or not, many tech support workers in India are quite incomprehensible to the Americans who are routed to them.
I transfer calls to and receive calls from Indian agents every single day, and I am exceptionally good at understanding Indian accents (there seem to be several variations within India). I have had more than one person in India ask me if I was in India, because I was literally the first American they ever heard pronounce their name exactly the same way they do (or at least the first American who bothered to). I would rather see my company offshore x number of jobs to full-time employees in India than to simply outsource the same jobs to an outfit where they pay the contracting company on a per-call basis. What is the incentive system at work there?
Having said all that, is not just the pronounciation of the words that confuses many Americans, but also the choice of words spoken that throws so many people off. For instance, "Thank you for being on hold" does not inspire confidence that this person, whose mercy you are at, is going to be able to effectively communicate very complex things to you over the phone, to fix your computer.
--something witty
I think more companies should look at Newfoundland Canada as a potential place to outsource. In the town of Grand Falls-Windsor there are multiple companies that are US based and rely on Canadians for their workforce. Those companies are benefiting from the lower cost of living that Newfoundlanders have compared to the rest of North America which in turn keeps salaries down. The people there are highly educated professionals with the credentials to suit most technology jobs. One of the companies that has a location there, choose Newfoundland in the late 90s after outsourcing to India for years and being very displeased with the results.
Is this the beginning of the end of the dominance of India in the tech offshoring market?
No- it's the beginning of the "poverty as a comparitive advantage" economic model. Just like we've been predicting for years.
These corporations were getting high off of the fact that they had an easy way to undermine American labor and trade standards- India was the perfect "fertile ground" for that; They had the education system of a developed nation (skilled workers), but the labor standards of a third-world nation. Now that they are actually establishing some standards for themselves, they are losing their "poverty advantage".
Welcome to the new World Economy- a "round robin" game where your nation wins when your standards of living have eroded to a point less than everyone else's; and you lose as soon as you try to start making them better.
Well buddy, I'm one of those employees. So I'm pretty sure you're wrong.
My Favourite Meme
If the goal of the country is to increase next year's GDP at all costs, then listen to the economists.
... None of these figures puts any red ink to a balance sheet, so why should the economists care? Their job is to serve the holy God of The Market.
Not all economists view max GDP as their goal. Some, and increasingly more, attempt to minimize the GINI coefficient (which also tends to maximize GDP as a secondary effect).
The externalized expenses of increased unemployment numbers (the real unemployment numbers, not the crap the Labor Dept. puts out), stagnant wages, and increased costs of living have been largely absorbed by increased reliance on credit (thanks in part to the housing bubble).
And economists have been warning about this for quite some time. What you failed to mention is our increasing trade imbalance. That's the biggest threat to our long run economy. As far as the housing bubble, read some economic journals for some positions on that. Reading economics as interpreted by the popular press/media tends to simplify positions to the point where it looks like economists think all of this is OK. In reality, it's the exact opposite.
have been largely absorbed by increased reliance on credit.
Economists have been concerned with the low American savings rate for decades. That does have far reaching negative impacts on the market, as does increased utilization of credit (read about the money multiplier and inflation). Even if the goal of every economist was to worship the market, as you put it, the points you've made and suggested that economists have ignored are entirely opposite of the truth. They're all valid concerns of every competent economist out there.
I have a feeling that when China decides to stop subsidizing us, we'll find out that our economy (and country) has been bankrupt for years.
This is an excellent point and I'm glad you brought it up. This is something most economists are very concerned about. The growing trade gap is everyone's concern, from Greenspan to Buffett, and seemingly to everyone BUT the current administration. I'm a republican (the true fiscally conservative kind, not the kind we have in office now. neoconservatism = liberal spending, oppressive social agenda), and I happen to be appalled by all of this. Fiscal responsibility should be the #1 concern of every administration, because that DOES trickle down in a sense. Want to keep the middle class afloat? Howbout not doing things that will raise inflation. The rich can take the hit, the middle and lower class sure can't. The first concern is the trade gap.
Anyway, I hope I was able to clear a few things up there. I have a degree in economics and a job as a programmer, I'm middle class, republican, and absolutely pissed off at the current state of affairs. Such a combination DOES exist, you know. Not all of us are concerned with the party line or pretending everything's OK because "our guys" are in office. I really hope a candidate runs in '08 who really has a handle on this, or at least the right advisors, because the last election gave us two candidates who were economically clueless, if not absolute liars. Whether your choice was "The economy couldn't be in better long term shape" Bush or "We can afford socialized healthcare" Kerry, the outlook for that 4 year term were awful. The problem is, none of these older-than-dirt politicians seem to understand the workings of a global economy because it didn't quite exist the way it does now for the majority of their lives.
Brilliant points, parent.
The real problem here is trying to get "all gain with no pain". The recession has been buried with paper-printing and off balance sheet spending. While growing the government to huge proportions has propped up some of the unemployment -- the rest is covered by simply changing how we compute the data.
The way we compute unemployment now and inflation is different from the 1970s. Plus, the new phenomenon of both parents working and people working more than one job have skewed everything. If I am employed for two jobs, does our current unemployment figure account for that? I don't know. But you aren't counted as unemployed after about 5 months -- which means anyone can be jobless but not unemployed. That is called a discouraged worker. Anyhow, the real growth has been in disability. If you really want to not work, you go on disability -- this figure is a huge revenue drain and is not counted in the CPI data that everyone nods sagely to on the Financial News Network.
Just from common sense; with all the changes we've seen in the economy from 1990 to 2005, the unemployment figure has (as far as I remember) never fluctuated more than 1 % from 5.5 %. So, from booming economy to massive off shoring and we still get pretty much the same number. Putting it that simply, doesn't that tickle your Bull Shit detector?
OK. Still not convinced? Now I blow your mind. When GM massively lays off people, the Department of Labor, Bureau of Labor Statistics can actually compute job creation. How? Well, only 40 % of large businesses are used to compute actual employment. Since a lot of jobs are based on small companies and self-employment and none of those are actually sampled -- the government can assume that those 12,000 workers in the auto assembly plant at GM have now become profitable entrepreneurs selling doilies on e-Bay. What the F@%#, you ask? This is called the CES Net Birth/Death Model.. A name that is so weird and obscure that you wouldn't stumble upon it accidentally and worry your pretty little head about economic matters that might be inconvenient. Yes, it is 1984 every year where we come up with meaningless names. Since wall street likes unemployment because this lowers wages because more people are trying to compete with illegal workers that we let in for construction and sweat shops, but doesn't like them too low because that scares consumers into not rotating debt between 3 credit cards and a second mortgage... well, they want to tell us that we got about 200,000 new jobs each month. So, this past year we've had 35,000 actual new jobs reported and 180,000 estimated with B/D Model in one particular month and another month we actually had about 320,000 (which might have scared wall street) and 120,000 were subtracted (because whatever). But on average, we've had about 80k jobs added each month this year to "fluff up" the figure. OK -- these are from a vague memory. I get all this info and then check it out with actual www.bls.gov figures at this web site -- good source of rumors and Angst.
Inflation. Well, basically, the government now has a huge incentive to keep this reported figure as low as possible. Union Wages and government programs and a whole host of other expenses have built-in inflation increases. The 3% inflation that we keep getting reported doesn't include volatiles like the price of Gas, Food, or Day - Care. Volatiles aren't included because they change a lot and it is reasoned that those prices are going to effect the durables eventually. But let's look at what we actually spend money on in my house; the House payment is just near the top of expenses. Since I refinanced with a low interest loan (and these rates are a danger to our countries debt finance) and a lot of people have re-fied to 30 and 40 year low interest loans -- so that reduces a major expense that reduces apparent inflation -- even though the price of the houses is going up at about a 20%
>>"ad space available -- low rates!!!"