Slashdot Mirror
Outsourcing to Rural America
andy753421 writes "Wired is running an article about 'Rural Sourcing, an IT company that outsources not to India or Mexico, but rural America.' The company targets IT workers in rural location due to lower costs of living, 'The company charges $35 to $50 per hour for IT expertise, which may cost around $100 in New York City. While this is no match for outsourcing rates in India, clients benefit from local accents and similar time zones -- not to mention the absence of stigma sometimes attached to farming jobs out to foreign countries.' The article also points out several other innovative attempts at outsourcing such as Lakota Express and Seacode, which was previously covered on slashdot."
Don't outsource to India, outsource to Indiana.
Specifically, Bloomington. There is a lot of talent here.
I for one welcome outsourcing to others in our country not over seas.
I think I'll continue to outsource to India. They tend to speak better English than Alabamans. (And they're less likely to take the afternoon off to marry their sister).
There are places on the fringe of major cities where a lot of intelligent, IT-inclined people hang their hats. Suburban areas probably have a lot of young minds that are willing and able to adapt to the ever-changing world of IT. Much better to 'source there than a foriegn country IMHO.
I know, deep inside me, there's a Linux nut just waiting to be let out.
It seems many of the better quality India based customer service companies have been hiring employees with little or no accent, so their English is very clear.
...". It takes almost 3 times as long to have a conversation as it should. You can be polite, but also be quick.
The thing that annoys me now is that they're so damn polite. You give them your first name and they reply "Thank you. Thank you sir. Thank you for the information." To ask a question they start with "Sir, could I please ask you for the
On my last job, wirelessing an apartment and "dealing with" schlepping to a cheap Brooklyn store to buy the family a laptop plus a little de-spywaring, I got paid $600 cash money. Sure the work I did might be worth under $20 in sweat, but one extra-sharp demand in Manhattan is paying for trustworthiness. I've networked and have a reputation with clients for getting the job done and not stealing any silverware. Manhattan pays more not just because people can afford to, there is a greater demand to protect their assets. Got some nice silverware here. And some virgins. Err, withdrawn---got some silverware.
This isn't sufficient motivation for US firms to rural-source, and neither are local accents or convenient time zones. The reason the programmer makes $100 in NYC is that they need to be there physically, to interface with a broader team, client, management, etc... If a job can be sourced to someone in a small town in America, 99% of the time it can be sourced to someone in India, for pennies on the dollar.
I'd give anything to be outsourced to someplace I'd want to live, say New Mexico, Northern California. I like making a lot of money, but it just doesn't go that far in New Jersey, where property taxes are out of control and there are just too many people. I'd take a pay cut to live in some place that was quieter, with a lower cost-of-living. And in this day-and-age of telecommuting, why not? I suspect it would save companies a fortune just by not having to have huge amounts of office space and the environment would certainly be served by getting a large number of commuters off the road.
GetOuttaMySpace - The Anti-Social Network
I'm all for taking advantage of hiring in small town America (I live in Indiana for the record), and quite frankly not having to deal with insane traffic, pollution, and outrageous housing prices is very nice.
But I think this firm might want to first invest in a website that looks like it was designed by more than a 16 year old with a "Learn HTML in 21 days!" book.
But that's just me, thinking people base opinions of companies off of how their website looks.
ce n'est pas un Sig.
All jokes aside from the horrible english that americans sometimes use, I (and many people I know) have had it with trying to communicate with people whose first language is not english. They may have had the crash course in english, but it's still hard to understand.
It's my understanding that one of the benefits of buying Dell stuff from the business unit (maybe only large bus) is that the tech support speaks real english. Maybe people are learning that sometimes a lower price is not all that it's cracked up to be.
eric
I work in Indianapolis. The parent company is in Los Angeles. Works out for both of us.
I don't get why more companies don't do this. In small towns, you can pay people a lot less and still keep them really happy. When their house only costs $30000, you don't have to pay them $80000 a year to allow them to live comfortably. Also, it would allow more people to live in small towns. The only reason that many people live in cities is because of access to more jobs. I think if people had just as many opportunities to jobs while living in small towns, then they would live there.
Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
I can see this working if you are looking to provide basic end user support, but good luck finding highly skilled technical people to move to the country for less money. In the past, I've been involved in trying to hire skilled workers to rural areas and its very difficult to find good people who are willing to move to remote areas.
I moved to Arkansas from the Washington D.C. area several years ago. My plan was to find a job as a software developer here but after looking for quite a while, I couldn't find anything that really interested me. I ended up moving to Mexico where I knew I could find some work (and also the slow paced lifestyle I was looking for). I did some work for various companies for a while and after then was contacted by some old co-workers about some contract work. The only catch was I had to move back to the U.S. The good news was I didn't have to move back to the D.C. area, where they were based.
So, I moved back to Arkansas and for 2 years I've been contracting out to one the largest software companies in the country. My rates are very competitive because my cost of living is far lower than what it would be in the D.C. area. I'm paying less for a large 3 bedroom house with a fenced in yard than I was paying for a small 2-bedroom apartment there. I get to have the slow-paced lifestyle that I was looking for and despite making less than I was in D.C., I'm saving quite a bit more.
Our group is also outsourcing to a company India and I'm under the impression that my rates are actually fairly competitive with theirs. I suspect there are a large number of people in this area that would work for rates that would be impossible to find in the D.C. area or other larger cities.
As one such person, (one who has been hired to work in a small town away from any large metropolitan areas.) I have to say it's pretty nice. At first I was worried that the change in lifestyle from a big metroplex (DFW) to East Bumblefuck, TX would suck, but it's turned out to be a lot nicer than I thought. More relaxed pace of life, less pollution, etc. Yeah, I took a lower salary to do it, but I've found you can live pretty cheaply out here... you can live like a king for a grand a month. (nice apartment/rent house, utilities, fast internet, the rest of my bills, and food) Plus it's kinda nice to see something besides concrete during the drive to work. Definitely not as horrible as some /.ers are making it out to be. Nearly all of my fellow coders are competent and pleasant to work with. No stupid rednecks here, just like-minded people who enjoy life away from the booming metrop. and all the headaches it brings.
In Soviet Russia jokes are formulaic and decidedly non-humorous.
I note that Thomas Friedman talked about this in his book, "The World is Flat" where he discussed how, I believe, Southwest Airlines sent its booking to stay-at-home moms in Utah. They were stable, ad low turnover, the pay was good for them, and Southwest cut their costs fairly significantly.
In addition, you are less likely to see unionization, you can sometimes farm out (heh!) work on a piece basis, reducing the benefits/workers comp/unemployment comp, etc.
I live in a built-up area of PA. I grew up in the boonies. I have long considered the possibility of giving someone where I grew up a copy of Openoffice, a dialup account, and a computer so that I can email my dictation out there and have them send it back on a piece rate basis.
I could probably save about 25-30% on my transcription costs.
GF.
Lots of petrified grits
For those on low/middle incomes, the parent poster's rules certainly apply.
People are being hoodwinked about globalization. It's a mad race for the bottom, with only a very small number of winners (i.e those that already have plenty of internationally-mobile money).
In the future, you can be a slave for some corporation or government (what's the difference?) or be a super-wealthy player. The age of fairness and democracy is over guys.
I feel we're hurtling back to Plutocracy the excesses of the Roman Empire, and the US is leading the way.
$35-$50. I pretty much live in rural America, and Sykes only paid $7-8 on the average. $9-11 if you were a admin. This was the highest paying section, and these people were required to know how to tell a client to completly disassemble and reassemble a computer. That's between $14,500 - $16,600 annually Yet, in the state where I live, the supposed annual salary for a programmer was stated to be $50,000, when in actuallity it was more like $27,000. To make comparisons, the adjusted County income for this same area was stated: Very Low: $30,300 Low: $33,000 Moderate: ~$44,000 Median: ~$65,000 Forget Indiana. India is right here in America.
Not sure what you know about the real world but $35/hr goes a pretty long way outside of places like New York City and the state of California. Believe it or not, we don't have to pay $400,000 to get a box house with 1200sq ft. Things really are that much cheaper. It depends on personal preference of course, but I'd rather be sitting on 2 acres of land in a 3500sq ft beautiful house and telecommute than in a small New York apartment with a window looking out at another apartment. Also it's bigoted and naive to think that because somebody chooses not to live in a 'wonderful' place like New York City (uck) that they are just dumb hicks or incapable of doing an IT job.
I was in the Dentist office yesterday and read a Business week article about how India's internal economy is booming so much now that it's getting harder to find and keep workers. This is leading to high turnover and making it tougher to outsource work there. I wish I had a URL but it was an early Nov. issue.
This could mean that outsourcing might have peaked, at least for India.
No matter where you go, there you are.
Everyone wants the person who answers their Tech Support call to be a computer guru, but no one wants to pay extra for that privilege. The world has changed, the computer support model has changed.
Dell is actually the only company I know that caters to this with their Gold Technical Support (an upsell added to the service contract for business customers). At a few jobs I have had to work with them, regular Dell business support and Dell Home support (India).
Having worked with all of the choices, I would never hesitate to spend the extra money to get Dell's Gold Support. Even if I get a guy on the phone who isn't a "guru" he has access to someone who is. And, just about everytime I've called I've gotten either Dell headquarters in Round Rock, TX or somewhere in Idaho.
Not all jobs in IT are pounding on a keyboard producing code. Many (if not most) telecommuting jobs require a lot of communication via phone and other methods and people in India for the most part are not up to snuff. There are some (probably the better paid) that speak English decently but the accents and the vocabulary are difficult to overcome in any job that requires a lot of interpesonal communication.
If cost of living is half then earning 1/3rd as much might work out. Between being in a lower tax bracket and having lower cost of living you might end up with nearly as much discretionary income. I know when I looked at moving to California from Ohio I figured I would have to make at LEAST $120K just to break even with my $50K/year here, and that was before housing prices went insane. I have a 3BR 1200 sq ft ranch on 1 acre, I paid $140K, in California if it was even available it would cost over a million! Don't assume that people are stupid just because they chose a different lifestyle than your own, we all make choices in life, it's not everyone priority to see as many zero's on their paycheck as possible.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
Finished reading 'The World is Flat' by Thomas L. Friedman http://www.amazon.com/gp/product/0312425074/104-96 58154-8360738?v=glance&n=283155&n=507846&s=books&v =glance
who actully talked about home sourcing by Jet Blue. About how instead of sourcing their customer support overseas they work with mothers who want to work and need to stay at home to take care of their kids. This just reminded me of that.
All that is necessary for the triumph of evil is that good men do nothing. --Edmund Burke
Which brings me to my next point, if these guys cost 1/3rd of the price it brings the question who actually wants to earn one third what they could in life? Practically nobody even if cost of living is cheaper.
This simply isn't true. There are plenty of people that are willing to work for less money if the money they get will both go further and let them live somewhere they prefer.
I DO think that a lot of these consultants will probably end up being a little older though. A kid right out of college is probably more willing and more likely to prefer to live in the big city. There are a lot of benefits to living in the "middle of it" when you are young, unattached & don't have many expenses. But a few years on when that kid gets married, has a kid (or two, three... more?) that moving someplace away from the big coastal cities will start to have a lot of appeal for them. Especially if they already owned a (small) home and can also cash out of the high-cost housing market and upgrade while also get completely out of debt moving to a lower-cost market that has a small-town atmosphere that they think is more conducive to raising children.
Our company moved from metro Atlanta to the Athens, GA area many moons ago. The reason was that we could get the unskilled workers we need very cheaply and they were happy to get the money we were paying. Keeping skilled workers is a constant battle since many of our staff live between Athens and Atlanta and often eventually defect to a job in Atlanta that pays a bit better.
Personally, I enjoy living in a $120000 3500 sq ft home on 1.2 acres of land so I actually live a 20 minute commute from Athens in the other (non-Atlanta) direction. I also get spend my summer weekends on beautiful Lake Hartwell instead of the massively overcrowded Lake Lanier since Hartwell is now only a 20 minute drive (24 miles to the boat ramp I use).
That is a move from RTP, NC USA to Bangalore, India. RTP's cost of living is probably mid-way between NYC and BFE rural town pop. 600. A 2800 sqft house will run about $300,000 to $350,000. Don't expect a new house here for less than $300K but older smaller ones might be as cheap as $150K. Apartments run $700 to $1400 a month.
I would be willing to move to a smaller city if I could take my IT job with me.
Think Deeply.
Typically when I get Indian customer service they speak either perfect English (Sometimes they'll ask odd questions like "How is your climate?") or with a British accent. Perfect English still sounds like an accent to someone from the United States where every state has their own accent. Everyone has an accent to Texans except people from Texas. Some states have light accents, others heavy ones, and some states (such as Missouri) have a different accent from north to south. You'll even find certain towns that have a unique accent that's different from the rest of the state.
However, that isn't to say that perfect English or British accents aren't understandable to Americans.
Who the fuck are you to judge me as someone "afraid to do well?" I've lived in the D.C. area for almost 20 years. The D.C. area IS great, if you don't mind living in a high stress environment and dealing with traffic nightmares. I got sick of it and left. I'm much happier where I am and I have a MUCH better quality of life, for me. I'm not saying it's right for you, but who are you to tell me what's right for me. You don't even know me!
I've been quite successful in my career. I've had dozens of magazine articles and a book published in the field. I lived for 3 years, quite happily, on the beach in Southern Mexico, something a lot of people would give their right arm to do. So don't tell me I'm "afraid to do well." I have the balls to do what I want!
I'm a coder (/programmer/developer) in Montana, and when I tell people from Seattle or California what I make, they think I'm joking. They can't imagine living on so little.
And guess what: we outsource some of our code to Vietnam.
While the cost of living is lower, many things cost the same. This means that computers effectively cost twice as much for me as those in the big city.
I got a job out of college in a small town and I've been planning a move into a city ever since.
There are more problems with small towns than are immediately obvious. Besides the fact that there are few stores, bars, and women, there are also few choices of where to work. I like my job, but I would be hard pressed to find a better one in the area. Anything else would be a step down or require a move. So they can get away with paying you in peanuts.
...you're doing the multiculturalism thing all wrong!
What you're supposed to say is that "marrying your sister" is a cultural practise of excellent pedigree, and shouldn't be judged by narrow "western", ahem, I mean "urban" standards. Then you should suggest that Southern drawl is in fact a seperate language, start a "Southern-English dictionary", and get the bible translated into simplistic sentences (with Jesus replaced by Elvis, as being "culturally relevant"). And then, start some large lobbying groups in DC (manned entirely by damyankees except for a token Southern frontman) which advocate "rural quotas", and always seem to support the Democrats.
Your logic is flawed. You assume that when workers give away their rights, they earn jobs. The fact is that Europeans have been giving away their labour rights and lowering their quality of living, and the unemployement just gets worse. At the same time, corporations are getting absolute records in profits. And those are not being used to improve living or create jobs.
If you give the corporations your hand, they will demand your arm.
I find it funny that many people take the side of the corporations, even when themselves are being injured by them. Tell me, are you a boss?
I previously worked for STI Knowledge. Alcoa outsourced their first level support to STI in Atlanta since their internal desk wasn't up to par. They got a good group of Helpdesk people and an excellent group of Sys Admins in Atlanta. They lucked out with our group and we were able to turn things around into a nice running well oiled machine. In an effort to lower costs and pass the savings on to the customer, they opened a facility in East Bumblefuck, GA...I mean Americus, GA which is a small town with a bunch of farms.
Over the course of a year my company started moving their helpdesks down their. Pretty much just laying off the people that didn't want to move, which was no one, and hiring new staff in Americus. I was given the offer to move down at my current pay rate and bonus with the possibility of my bonus being removed at a later date (my bonus made up 1/3 of my annual income). I proposed a larger salary due to the increased living expenses if they were interested in keeping me on board.
At the time I was living very cheaply with two other roommates in Atlanta. I'm very selective with my rommates for obvious reasons and moving to Americus would require that I rent a single bedroom apartment for more than the current living situation. Other things to consider: my car payments, insurance rates, phone costs, credit card rates, cable internet rates, and gas rates all would not go down. Not to mention the cost of regular drives to Atlanta to see family and friends and go clubbing or the movies. It made no sense for me or any of my colleagues to make the sacrifice to move down for a company that not kept their word and stabbed us in the back on more than one occasion.
The helpdesk doesn't take much to do and they can get away with moving it to Americus. However, the Sys Admin portion required real skill and they cannot find real skill in Americus. Last I heared, one of my predicessors shut down one of the production UNIX servers then later quit, my other predicessors doesn't know what he's doing, the other admins don't know what they're doing, and they've brought some people from India to "help" with the workload.
I'm all for on-shore outsourcing, but I feel that some companies don't know how to execute it properly. Some companies will save money. The last company I worked for is having to spend more money in labor to move it to Americus (i.e. hire four people to replace me). Out of ~32 helpdesk people, only 3 moved to Americus. Out of 8 Sys Admins, no one went and a large portion of knowledge was lost.
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Yeah I'm not bitter.
Specifically I live not very far from the Twin Falls, Idaho Dell facility mentioned in TFA (I even know some folks who work there.)
The huge problem with this is that socially, rural America sucks. It's cheap to live here, but aside from skiing/snowboarding/whitewater (thank goodness this is Idaho and not Nebraska) there's really nothing to do for youngish geek-oriented people. It's simply not fun to be here unless you are religious and/or enjoy cowboy-type stuff. ESPECIALLY if you're single.
The social scene in a city is far better suited to IT workers. That's why they want to live there -- not just for the jobs.
Turn off the talk radio for awhile.
The minimum wage raises the price of unskilled work that can be performed cheaper and more safely by a machine. (Or an illegal, these days) Minimum wage jobs tend to cluster around a few industries, chiefly restaurants and retail. You wouldn't see much inflation because people would choose other options with lower labor overhead. (Buying food and cooking at home or ordering merchandise online)
The inflation and spiraling standard of living that we have experienced over the last 30 years are a societal problem -- wages are a symptom, not a cause. We're transitioning from an urbanized industrial society into a suburbanized consumer society.
Conformity is the jailer of freedom and enemy of growth. -JFK
Yeah, but I bet any a one of them can kick your ass.
:P
See the Pictures of the Flood of '08
You moved your work to where you live, the other solution is to move where you live close to your work.
During most of the hitory of mankind, work was always close to home.
It was only with the advent of the car first, and long distance trains later, that we fell on this nonsensical notion that we could work in a place 100 km away as something normal.
I was doing exactly that, commuting from suburban Britain to London. 2 to 4 hours wasted every day.
I got fed up, and my solution has been to move walking distance from my office.
Best think I have done in my life.
After finishing work I have a full world of posibilities each day to spend my free time: I can go back home, relax, go out, go to the gym. Whatever. I am actually saving money in transportation and food (cooking at home is cheaper than buing ready made food or take aways).
My place is small, but so what? There are families as well where I live. All perfectly nice people. There is a bit of gang violence going on around, but guess what, it is not as much as the media always says (what a surprise).
In any case eventually economcis will bring people to their senses. A situation where people commute 2 hours, with all the wastage this implies, is completely unsustainable.
IANAL but write like a drunk one.