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Study Claims Offshoring Doesn't Cost US Jobs
SwashbucklingCowboy writes "Infoworld has an article up about a survey by the Software & Information Industry Association claiming that offshoring doesn't cost American jobs. The article quotes the executive director of the SIIA as saying, '[Offshoring] was used almost entirely as a form of expansion, not as a replacement.' Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
I can say this study is wholly and completely inaccurate. Well, that's the diplomatic way to say it anyway ;).
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Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?
Who's saying the job could have been created in the U.S.?
The theory of relativity doesn't work right in Arkansas.
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No. Another job can be created here instead.
Yet another insult from the damned CxO class to the Programmer's Guild. I wonder how many Americans they have to insult before people start shooting CIOs?
SJW: a person who perceives an injustice, and while correcting it, commits a greater injustice.
Forgetting the fact that I've had to get a new job nearly once a year since 2001 due to outsourcing, not necessarily to India, but to Canada and Vietnam.
A song pirated is a lost revenue song!
Ok, off shoring does cost american jobs. I had a friend who worked for HP a few years ago in their customer service department. Guess where his job went.
Well - that may be what the study says, but that simply doesn't jive with Silicon Valley's experience. The valley (read US Semiconductor Industry) has never really recovered from the Dot-Bomb downturn. We lost around 200K jobs here in Silicon Valley after the downturn, and they have never really come back. What happened was Bangalore.
Just to highlight this - there was an entire division of Intel that was closed down and re-opened in India a few years ago. You could relocate to India or loose your job. Real simple choice. Speak Hindi??
Have you compiled your kernel today??
Just because it's a study doesn't mean it's scientifically valid or correct.
Reality is based on observation.
-- Tigger warning: This post may contain tiggers! --
Nope. If it was just a matter of location it'd be silly to put your employees far from reach. It's a matter of money. Those jobs created overseas could not exist in the US since they simply don't pay enough to be legal or worthwhile for someone seeking employment would take.
Under 5% unemployment is termed "full employment". New jobs created here have to be worthwhile or else they'll stay open for ever. This isn't the late 1800 - early 1900's, after all.
I worked for a major retailer for 17 years, then Feb 18 2005 wammo! My job was replaced by offshoring. The person now at my desk is a figurehead (or project manager) for a programming group in Bangalore.
Thanks,
Jim
Comment removed based on user account deletion
The jobs aren't lost, its just that somebody else somewhere is doing them.
I'll have to let my brother know. He'll feel good to know that the 6 figure IT job he was just laid off from so it can be shipped offshore didn't really happen.
Sure, we lose a 40 hour/week programmer position to [india|china|vietnam|swaziland], but we generate 40 hours/week worth of bugfixing and project management work, so it's really a wash.
there is no need to sign your posts. this isn't usenet. your username is right there above your post. stop it.
Wow, that is some astoundingly simplistic logic there. Good work!
Temporarily it may be a job lost, but cutting costs allows for further expansion of a business. (if the business is intent on growing, which 99.9% of businesses in the US ARE interested in doing I think.) I've been of this opinion all along that off-shoring was no great threat to jobs in America, just like buying Japanese cars or clothing made in Taiwan and China posed any major threat back in the 80's. It's the stifling of expansion and growth (like the stifling of 3G, wireless, and broadband spectrum use in the US) that poses a serious threat to jobs in America. Freedom is risky, but risk produces hefty rewards. No freedom, no risks, no rewards. If you don't want the risks of losing your job due to IT off-shoring, go move to France. I'm sure you'll find the rewards there are in much less frequent supply than here in the U.S.
Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?
Or the job may not have been created at all if not for the economic advantages, perceived or otherwise. It is like the MPAA/RIAA arguing that piracy costs them billions a year in lost sales when in fact the so-called pirates may never have intended to purchase the item in the first place.
I expected to find an article filled with made-up numbers and logical fallacies. There wasn't much in the line of reasoning, so no fallacies, and the numbers are comprehensive and cited. The claim is that there aren't any Americans to fill the job anyway. Three quarters of businesses were happy with the work that was done off-shore. I read that to mean that they're not just looking for a warm body but someone who can do the job to an acceptable standard.
Is there really a skilled labour shortage? Everyone who works in HR at an IT company or a company with an IT department seems to think so. If companies are really choosing offshoring because they can't find an equally qualified person onshore, than Americans aren't losing jobs. To compete with the offshore candidate, they'd need to receive further education. Perhaps the real problem isn't that Americans are losing jobs, but that they lack enough education to compete with skilled professions in a global market.
mandelbr0t
"Please describe the scientific nature of the 'whammy'" - Agent Scully
Yeah but when the economy turns down, who are they gonna lay off, the guy in California making $50/hour or the guy in Mumbai making $9/hour? Sure, everyone's happy when things are humming along, but the cracks will show later.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
Well, if a song is downloaded from the internet that could have been purchased, isn't that a lost sale?
I will say that even though I lost a former job to outsourcing and cost-cutting measures, my impression having worked for 2 companies that outsource is that companies are willing to hire more employees than necessary in outsourcing operations just because they cost less. That may factor into the numbers. If I lay off 8 people in the states and hire 10-12 replacements, I have created jobs kind of but not really. I've seen this many times in the efforts to get a group in India up and running.
Not that I've ever seen it successful yet...
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
I learned in elementary school that 2+0=2. Therefore the answer to your question is "no." This simple mathematical skill, known as "arithmetic," is difficult to remember when participating in political discourse mostly because it's so rare, but is absolutely vital in making public policy that isn't simply all wrong.
If Company A is struggling and they outsource and save money, they may lose 100 jobs but save 1000.
Another company could become more competive and grow here as well as overseas. Different jobs that better utilize American talents may be created here.
Or a company may just slash jobs that go overseas.
Life and economics doesn't have a Tivo attached to it.
Except for ending slavery, the Nazis, communism, & securing American independence, war has never solved anything.
hmm... If you believe in outsourcing then you are no better than a drug dealer.
Your willing to sell out your country's future just to make a buck.
I was an Systems Engineer at Welch Foods. The CIO that was in place retired, a bean
couting soon of a bitch was promoted to be the new CIO. Under his direction the company decided to outsource IT. I was asked to teach the "offshore" team about my code and
Linux / Oracle Cluster layout. I put it off for 6 months and ecouraged my colleges to
get thier resumes out. They did, and so did I. I did not teach the remote team. I
left for my new position somewhere else, and gave myself a little vacation in between.
I touched base with some of the non techies that were my friends, they said it's not the
same without me and my friends. It not takes weeks, not hours to get get some custom coding done. It takes a several weeks to get Oracle patches in, the remote team has a high
employee rollover rate. Welchs deals with new people every 4 months.
hey... no love lost here. If they were willing to sell me and my friends out, then
too bad.
Don't Indians believe in Karma? Didn't it originate there?
hmm.. pretty soon it's payback time!
(yes, there's probably a more efficient regexp to do that. No doubt someone will point it out).
It's true I tell you, feller at work's next door neighbour read it in the paper.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
If a movie is downloaded that could have been purchased, isn't that a sale lost?
"Ask not what your country can do for you." --John F. Kennedy
Above was going to be my original post, but it's pretty clear many others beat me to the punch, and it's (in my opinion) also seemingly clear there is a lot of opinion and sentiment the article is talking out its private parts.
It's interesting to me the ones making decisions to do the outsourcing are the ones funding the studies to somehow assuage their collective guilt. There's lots of empirical evidence jobs have been and continue to be lost through outsourcing.
...and the internet is only 1% pr0n.
You constantly struggle for self improvement - and it shows.
Hooray for bad Engrish on fortune cookies
The job market is a lot like demographics. When you cut the young out of the picture, you end up with a collapse over the horizon. Just as societies that have sub-replacement level birthrates get pummeled by other nations and immigrant groups that do in the long run, countries that cut off the supply of apprentice-level work to their young find that surprise, surprise, their young people never become older replacements for their field.
The problem is very complex. It's a cross between expensive regulation that makes Americans expensive, lack of foresight being called an asset by many business people and just general lack of concern about the future.
One day America will look around and say, there's so much opportunity for those that know where to go, but why aren't Americans filling these jobs? Then the displaced CS, EE, hard sciences, etc. students can say "you fuckers brought it on yourselves."
There is also a realpolitik aspect of it that should scare the hell out of our leadership. Capitalists of all stripes love to harp on human rationality, but humans are **rationalizing** not **rational** beings. Nations go to war at times for completely idiotic, abundantly obviously suicidal reasons. Witness Gulf War I and Iraq. Who actually thought that Iraq wasn't going to get pummeled into oblivion militarily? Yet they did it anyway!
See, the thing is, we might not always be allies with India, Pakistan, Taiwan, etc. We might actually end up at war with them in the future. It's slim, but who knows. The people who poo poo these concerns need to face up to the facts of history which is that nations have no permanent allies, only interests. One day, we may find that all of this regulation cost-imposed outsourcing has put America in dire threat of having not enough engineers to actually keep its economy strong, its military well-equipped, etc. We might find that some of these nations are also feeling stronger, and want to start doing things their way.
So your telling me that in 2004 when my job was outsourced to india and i was fired because they can pay some jack ass 30 cents an hour to do my job half way across the world that my job wasnt lost? Whoever worte this needs to be stabbed the crotch so his stupidity can spread out into the genepool.
The logic isn't completely off. If the job could've been made here (though at more cost which they could still afford) then it is a lost job. The RIAA/MPAA assume you would've made the purchase without any proof. These jobs however were planned and definate so they were going to be generated. If you purchased the CD then returned it and downloaded a copy instead then that would be a better comparison.
I agree though that just saying it is a lost job without checking the requirements isn't correct. You can't create a job for handling local on-site customer support in Madras India by creating the job in Omaha Nebraska.
It is by the juice of the coffee bean that thoughts acquire speed, the teeth acquire stains. The stains become a warning
The data compiled for this study was composed in Bangalore India.
1. You do not own 'your' job.
/flame on
2. You are not entitled to a job.
3. If someone else is willing to do the same work for less money than you do, too damn bad for you.
4. Yes, it is a race to the bottom. No, that isn't necessarily a bad thing in the long run. When you want to fill a container you have to fill the bottom first.
5. If you think you're better than the people 'your' job was outsourced to, prove it.
"Prefiero morir de pie que vivir siempre arrodillado!"
I was going to make the same analogy.
Proud member of the American Non Sequitur Society. We might not make much sense, but boy do we love pizza!
Offshoring does not decrease US tech jobs. What it does do is increase the supply of IT workers available to a US company, thus lowering the price. Instead of having to dangle a $60,000 / year job to get a good candidate, a company can dangle a $50,000 / year job and have it filled.
Who paid for it:
"a survey by the Software & Information Industry Association"
It depends upon what they are measuring.
From TFA:
Notice the usage of "H-1B visas" in that statement? That tells you what they're actually looking for. Cheap labour. The cheaper, the better.
The question isn't whether there are enough H-1B visas available.
The question is how many programmers are there in the US vs how many programming jobs there are in the US.
I'm not seeing that question being asked. All I'm seeing is stuff on savings and such. If they're measuring cost savings, then they're not going to find any lost jobs, are they?
the work apparently had to be done by someone, for American customers.
Offshoring is racist - because jobs and resources can go across borders, but not American workers.
--- Grow a pair, liberals... stop letting the Republicans bully you!
Speaking for our company (a small startup software co.), we expanded offshore. We did not have the funds to expand within the US, and hiring offshore allowed us to thrive and grow where before we were at risk for failure and disolution. We have, as a result, been able to grow and actually do some hiring in the US. These new jobs would not exist if not for the fact that we offshored previously to survive.
That being said, any generalization one way or the other is going to be inaccurate. I have no doubt that people have lost their jobs to offshoring, but that doesn't mean it isn't beneficial in other situations.
People are no less morally worthy because they live in Bangalore India rather than Bangor Maine. Sure it might suck if you lose your job because it moved overseas to India but it doesn't suck anymore than if you lost your job because it moved to another state. There is no justification to be up in arms about India attracting tech jobs than there is to be up in arms because Virginia and other states with lower paid programmers are attracting tech jobs from Silicon Valley.
Moreover, the people in the third world benefit far more from these jobs than do Americans. The difference in lifestyle a good job makes in the US (where social services and other benefits provide a safety net) is a lot smaller than the difference it makes to someone in a third world country. Relative to the countries 'taking' our jobs we are the very wealthy and it is disgusting that we whine when they want even an unequal share of our prosperity. If you believe the we should tax the rich to provide benefits to the poor, or just don't believe in making laws/policies to keep the rich rich and the poor poor it is hypocritical to complain when the truly poorly off start making some money by working harder for less money than people in the US do.
In the long run (and perhaps medium or even short term) I think outsourcing will benefit us, not only by making the world a richer and thus safer place but also by cheaper goods and economies of scale but even if this wasn't true it wouldn't be good grounds for complaining about outsourcing.
Bitching about outsourcing is just selfish pouting because someone else wants a poor version of the opportunities we enjoy!
If you liked this thought maybe you would find my blog nice too:
The idea that the economy is a zero-sum affair is so abundantly contradicted by readily available evidence that I find it almost amusing that it holds such sway over people.
No, a job created elsewhere instead of here does not automatically mean that it "costs" us a job here. Jobs aren't a resource that is mined from the Earth, jobs are created by the economy. If that overseas person does well enough, it may "create" two jobs here.
It's not even right to speak of jobs being "created"; a more appropriate verb might be funded. There's a "job" that involves you being my personal punchmonkey, but there's no way we're going to come to mutually beneficial agreement about that "job", so it isn't funded.
But the flip side holds; the net impact could be more than one job "destroyed". It's not zero-sum.
The whole thing is very complicated, because even if off-shoring a developer creates/funds five jobs over here, it may be the case that none of them are development work. Or one off-shored developer may well create three more development jobs, but not in Silicon Valley. (No, you don't get to say all three of those jobs are cleaning up after the off-shore guy; if off-shoring is a net negative value, the economy will eventually cut off the off-shoring, even if that means driving a particularly stubborn company that refuses to see it as a negative value bankrupt.)
But one thing it's not is "zero-sum".
(Even if you don't "like" capitalism, it's vital to come to understand what capital is and why capital produces more capital. Communism, and to a lesser extent socialism, can be seen as starting with the assumption the economy is a zero-sum game, and they end up creating a self-fulfilling prophecy on that front as in their zeal to make sure capital/wealth is evenly distributed, they destroy the mechanisms of capital/wealth creation. Actually, they end up with a negative-sum game. I'm not defending any particular instantiation of capitalism at this time, I'm just saying you damn well need to understand why it does what it does if you want to understand how economies work.)
AMERICA ONLINE. Thats all the evidence you need. Almost all of the AOL tech support call center functions were offshored. The Jacksonville, FL call center was shutdown rather suddenly. Phoenix, Dulles all had layoffs as well. The layoffs began well before AOL was on its final slide to its current insignifigance in the online world. (sorry AOL, but its the sad truth of it)
Cheers.
This is my sig. There are many like it, but this one is mine.
Not necessarily. It's entirely conceivable that a firm cannot profitably expand operations and pay the wage required to hire a U.S. worker. However, the firm might be able to expand by hiring labor in another country (for a lower wage). In that case, the owners of the U.S. company (which often includes the company's own employees) would benefit. Keep in mind that foreign labor is not necessarily a perfect (or even very good) substitute for domestic labor.
This is not a zero-sum game, and it's very easy to oversimplify matters. I'm not saying that U.S. workers are not or cannot be replaced by foreign workers, I'm just saying that it's possible that foreign workers could be employed where otherwise there would be no job.
A similar argument has sometimes been made regarding investment outside of the U.S. After all, if you invest money in China, you're giving up investment in the U.S, right? Well, it's not that simple. One paper, for example, claims that a 10% increase in foreign investment will lead to a 2.2% increase in domestic investment.
The point is, outsourcing/offshoring is a complex issue. Since it's such a new phenomenon, it will take some time for researchers to come to a consensus about its general effects.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
Examining the source of funding is very important in studies. Not that the study has no value but that they have their own inherent perspectives (biases). Every manager you ask today talks about the difficulty to hire good talent... irrespective of the country they are in. But then what is "good" talent? .. we always want better than what we have now.
0 05/sb20051212_623922.htm
The bottom line is: The 'globalization' of industries and labor pools is going to cause upheavals in certain areas. No one complained when local industries in developing countries were destroyed due to the manufacturing and market power exerted by large western conglomerates. Similarly we are not going to see too much sympathy for programmers here that do run of the mill jobs that can be done anywhere else in the world. How many HTML programmers do we see today? I think the US has always been creative and must remain so in order to draw the wages they do today. If you stagnate, you lose.
Here is a report about another study conducted at Duke University about outsourcing:
http://www.businessweek.com/smallbiz/content/dec2
FTFA: "There's a lot of negative talk, that is particularly political, about offshoring costing American jobs", Thomas said. "That's not really the case."
It's easy to decree such 'truths' when done from an untouchable crystal throne. North America's going to the shitter, one outsourced job at a time.
From a software perspective, for every project that is offshored you need several people in the US to remove the bugs and actually make it work. The more software is contracted out, the more jobs are created here to manage that and to fix it afterwards.
6 years after Lou Dobbs brought this issue back from the grave, we have better anecdotes. Most of our positions are management. Development is almost entirely in India. Out of 20-30 managers there are only 4 permanent developers. A lot of money is spent on travel to get the Indians on site. A lot of time is spent waiting for time differences and code drops from India.
Indians are better educated, more practical, less political. Through a strong Rupee, they are motivated by the prospect of becoming wealthy and owning a house in India. Americans are uneducated, political, and no matter how long they work, they can never become wealthy or own houses.
Another argument (in addition to yours) is to consider at what cost. If it pays less than half to hire someone overseas as opposed to inside the US, its going to happen over there and never over here. Most people seem to forget that. Those jobs would NEVER be created here is they have to pay someone twice as much. Simply put, quantity supplied of people wanting that job far exceed the demand of those workers.
I have never let my schooling interfere with my education.
So, IOW, while we aren't actively replacing American workers, there are jobs that would otherwise have gone to American workers had they not offshored.
In economics, this is called opportunity cost.
The bottom line is the same, though: Instead of hiring American workers, they are paying foreign contractors
Now on to my experience. I was part of a team doing embedded development for a consumer electronics platform. We were under tremendous time pressure to get the product to market, so management decided to offshore the development of drivers which I had been working on. When I handed over my drivers to the offshore team:
- The driver was responding to interrupts, and used an interrupt driven model.
- The framework for using DMA was setup.
- The framework to work with the kernel's block specific device driver interface was setup.
- I estimated that it would have taken me another 4 to 6 weeks to complete the driver. The only things I had left to do were to write the routines which actually transferred the data to and from the device.
Now, 6 months and several deadlines go by, and we haven't heard anything regarding the drivers. Finally, we get our code back:- The interrupt code has been removed. The driver now works on a polling basis. Keep in mind how acceptable this would be in a real time system.
- The DMA code has likewise been removed.
- The driver doesn't interface at all with the kernel's specific device driver interface - instead, it uses a hack by which it talks to the block layer, bypassing the development track of every other said kind of device.
- Oh, did I mention that the driver didn't work?
So, not only are we now behind schedule, we ended up shipping a broken driver to the customer. Several of our customers missed the Christmas selling season because our code wasn't delivered in a timely manner; worse, it's now 6 months late and doesn't work.We had to spend several months of engineering time to debug/redo the driver to get it to a working state. Here's what offshoring cost my company:
In the end, offshoring was a net loss for everyone involved:
The only people who are getting rich from offshoring are the offshoring companies. The only reason why this fraud is allowed to continue is because it's hard to prosecute across national boundaries.
And, if anyone is wondering, we later learned that the engineers who wrote the broken code were formerly Java developers who had no experience writing embedded code. My company would not ever have hired these guys had they interviewed with us, yet we saw no problem in contracting a critical part of product to them.
The society for a thought-free internet welcomes you.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
No... No: This one goes up to eleven.
a Wal Mart job, for the most part.
Offshoring IT means new people will never get into the industry at all.
IT now demands high level network administrators and accomplished programmers. Americans cannot reach that level of expertise without starting out as a lower level programmer, software tester, sysadmin, tech support person, etc. - and those jobs have gone overseas.
The higher level jobs can't be filled because no new qualified workers are coming into the US workforce, and the qualified people are entrenched in jobs they won't leave, or are afraid to leave. And yes, before you say otherwise, I know this. I am a data center manager and I see our ads go unfilled constantly. Which is why since before this data center came up, I kept our jobs from going overseas and made sure we grow our talent right here, in house. My lead network administratress started out as our receptionist and then a tech support rep, then a tester, then a sysadmin, then a network admin. At other companies, that ain't gonna happen. Ever.
So no, another job was not created here - except low paying service jobs like Wal Mart cashiers, and super high end jobs that newcomer Americans can never qualify for.
--- Grow a pair, liberals... stop letting the Republicans bully you!
As a consultant I've been around numerous corporate offices. At each of them I've noticed that half the people working there speak terrible english, and much of the work is offshored. Why is this? If I had to guess, I wouldn't say its because these people do a better job. Most likely they its because they do the work cheaper. Maybe we haven't lost jobs, but I'd say there's a good chance we've lost money.
I'm not entirely sure why so many people believe that hiring an American is somehow more virtuous than hiring a foreigner. Is it just thinly disguised racism? A belief that Americans are more worthy of a job because of where they happened to be born? Or is it just a fear that they aren't as qualified for their own job as someone else could be?
You are reading a copy of my copyrighted post.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?""
Same as if a sale not made because of piracy is a loss.
Who were the idiots behind this study? The whole point of offshoring is to save money. You don't save money if you hire people offshore and don't eliminate jobs onshore. Or, if you hire offshore for NEW jobs, you eliminate positions you would have HAD to hire onshore for.
Its just a bunch of nonsense. If we put a brick wall around the country and you couldn't leave for anything, you can't tell me that the jobs that are being offshored wouldn't be taken up by someone in the country. Thats just ludicrous.
I for one welcome our new Indian Tech Support Overlords.
Did someone say cake?
Sure you might have lost your job to outsourcing but why is it hard to believe that the money the company saves by firing you will be used to expand the companies operations? Eventually expansion involves hiring more local (US) workers. Companies that stay in business tend not to make irrational decisions. They have their best interests in mind which in turn means they have the US economies best interests in mind. Economy goes up, unemployment goes down. Not immediately but given time it happens.
do you know squarepusher?
1) keep buying walmart/target 'made in china' products.
2) keep selling out your country for a short-term reward by offshoring/outsourcing.
3) watch your country's economy fall apart and while you learn to speak mandarin.
4) profit!!
Globalization is bad for Americans. Don't let these elitist conglomerates misinform you. Do the math.
the only permanence in existence, is the impermanence of existence.
InfoWorld relies on ads, and doesn't sell a lot to Joe Paycheck. Other studies show that offshoring does cost jobs. This is really no different than industry-funded studies that claim "X" is cheaper, stronger, brighter, etc. than any alternative.
Ben Hocking
Need a professional organizer?
Suppose some software can most efficiently be written in India, but we prevent (either through law or just bad publicity) a U.S.-based company to outsource the task there. This immediately gives a competitive advantage to companies outside of America to have the software written in India, and then sell it in the U.S. and keep the profits.
There's really no getting around it - if India has a relative advantage in software development, then that's where the software should be developed, and attempting to prevent it can easily cause more, not less, grief.
Seen the same thing happen to me and 600+ fellow employees a few years back. I think anyone with more than half a brain knows this survey is BS. Unfortunately a lot of HR types don't have half a brain.
'[Offshoring] was used almost entirely as a form of expansion, not as a replacement.'
Yeah, I heard the same spin from "Upper Management" before they laid off 3/4 of my team.
Americans can't pursue these jobs overseas. The jobs are for companies that are serving Americans. Offshoring denies Americans jobs that serve Americans. Because of where they're born, ironically. Offshoring is the belief that it's more virtuous to hire a foreigner to serve American customers, than to hire an American to serve American customers.
That's as not so thinly veiled racist as racist can possibly get.
--- Grow a pair, liberals... stop letting the Republicans bully you!
Now back to America and the real world. This time around I hire local 'mericans for the marketing, sales, writing, in-house QA writing jobs. Looks like in America I'm 'creating' 10-12 jobs - does your math still say we're losing them?
Think outside the... Hey, where'd the friggin' box go?
This issue is a very emotional one and as a result, often ends up in a jumble of confusion, with people arguing different things. Some key items to remember are:
The truth of the matter is, people in the US are not inherently smarter or better or harder workers than people in other countries. Despite this, people in the US in general enjoy a much more comfortable standard of living and own more of the wealth than most of the rest of the world. This is due to numerous factors. The difficulty of communication and travel has concentrated wealth in certain places, and prevented it from accumulating in others. A dumb, lazy person in New York is more likely to live comfortably and with relative wealth than a relatively brilliant and hard working man in Ethiopia. This is mostly because people in New York looking to hire someone to do something have difficulty hiring the Ethiopian for many of the tasks they want done. This is slowly changing and changing rapidly in some fields.
Education and experience provide significant momentum. The US has a lot of both, but programs that resulted in people coming to the US and getting both and then leaving (or being forced to leave) have started to move more of both to other locations. As more and more jobs move overseas, those people gain experience and are more likely to pass that on locally. As such, once education and experience leave the US to foreign jobs, it will snowball to some degree, or at least resist concentrating again.
In addition to outsourcing jobs to other countries, outsourcing includes outsourcing jobs to other companies. For businesses in rapidly changing environments or who need work done just once, this makes a lot of sense. Hiring your own construction people to build offices, when you're an IT firm is a bit nuts. The problem is, because of the standard of living in the US, any jobs which can be done well by foreign employees, are almost always cheaper. This is mitigated by the small size of the trained foreign work force and by the unwillingness of management to outsource themselves or move to another country.
The result of this last circumstance means that often decision makers outsource core competency parts of their work, which is basically subsidizing the training and experience of people outside their company (and often their country). Pretty soon someone realizes that the company doesn't have any real employee assets anymore and is just a shell.
That an industry trade association-whose membership roll is made up of corporations who regularly participate in outsourcing jobs-would conduct a study which finds that outsourcing doesn't affect US jobs. It's just more corporate propaganda to try an influence policy makers in Washington and provide ammunition for Congress members in the pocket of the IT industry. Useless study.
you either, because you'd have just blown the money on booze and hookers anyway.
"Not an actor, but he plays one on TV."
Seriously. I worked at a company that was totally allergic to the notion of hiring permanent employees. So most of the time they just contracted things out to India. Had that option not existed, they would have hired local contractors or permanent employees. They go to India because it's cheap, not because the talent doesn't exist here.
This sig has been temporarily disconnected or is no longer in service
UbuntuDupe says that because some high paying IT jobs were lost overseas and were replaced by minimum wage or barely above minimum wage service jobs, we've scored a victory in the jobs arena?
That's BS.
That's called underemployment - the total reduction of an educated, skilled workforce to menial labor which itself can be automated.
That means a loss of buying power which means that in the end, those SAME Northwest LA drycleaners will be hurting for customers.
--- Grow a pair, liberals... stop letting the Republicans bully you!
Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
Why yes, yes it is.
And when someone gets their music or movie online, without buying the CD or DVD intended to be the delivery mechanism for it, it is a sale, and thus profit, "lost".
No, but U.S. workers, and more importantly voters, don't really care. The purpose of the U.S. government is to do what's best for its citizens; if that also helps other people abroad, then that's great -- bonus! If not, they can complain to their own government. Countries exist for the mutual benefit of the governed; if a government is doing something that's fundamentally disadvantageous for its own people, something is wrong.
Sacrificing jobs in the United States in order to employ the rest of the world isn't something most people here are prepared to do, nor should they.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
And depending how you state it and what you mean by it, it can be true or false.
A new job created in a foreign country is a new job not created in your local company. But is that bad in and of itself? What if that new job created in a foreign country was created by a company in that same foreign country? Those happen all the time, and we don't describe them with language that makes it sound like our own country was just harmed.
So a new job is created in a foreign company by a local company. That is most definately not a job "lost." It is a job created. It just wasn't created here. Is that a problem? Only if you feel that every job a local company creates should be created here.
Similarly, a new copy of an existing song is just that, a new copy. That is not the same thing as a lost sale. Nothing was lost; something was created. It is possible that someone could have paid you for a copy of that song, instead of having that copy created by someone else by other means, but that doesn't mean you lost anything. You just failed to gain something. The problem comes when you expect that you should, in fact, gain something for every copy created.
Does anyone know of a good site like /. for decision makers?
/. is going to have a high amount of people who think the study is crap. Where do the IT folks who read this hang out online? I would like to see their responses.
Obviously
Who do they expect to believe that report? My company has outsourced most of their IT services to another company. I am a systems analyst, and work closely with the developers who belong to that other company. Apparently, my company decided that they weren't happy with the prices they were being charged for software development, and the situation that came of that decision went like this:
My company: You guys are charging too much for SW development. Charge less or we outsource elsewhere.
The other company: We can outsource to India!
My company: Whatever, as long as it costs less.
Luckily, my developer wasn't one of the guys laid-off (or maybe that's not so lucky...), but he has been turned into a pencil-pusher. I give him my requirements, he writes them down and sends them to India.
Europe isn't so hot now.
High unemployment, higher taxes and social programs pushing their governments into massive debt.
The only way this study is accurate is if it took place in a world where massive country-absorption through economic, political or military gains were still possible. Unfortunately, with very few exceptions, doing so as a western-world power is nearly impossible.
Never thought of India as being the 51st state. Would that make people there American Indians?
Ginga no Rekshiya Mata Each page.
Take a DVD player. You can purchase a cheap DVD player for about $40. Now, the plastic and metal in the DVD is not very valuable, pretty much you are paying for the labor and logistics in manufacturing the DVD player.
Now, the DVD player is made in China, and lets say the labor to make the DVD player cost about 1/20th of what it costs in the U.S. (it is probably actually cheaper than that). That means, that the same DVD player would cost at least $800 if made in the U.S. (in reality, it would cost much more... I am not including the differences in enviornmental regulation, defending frivolous lawsuits, medical insurance, taxes, etc. all of which would be much higher in the U.S.).
Right now, when a DVD player cost $40, it means that DVD players are cheap and ubiquitous. The store is making money selling the DVD player and the DVDs you will buy to put into the player (all that is money made in the local economy). Movie companies are spending hundreds of millions on movies, expecting to recover that money in part on DVD sales - and most U.S. movies (and virtually all DVD manufacturing) happen IN the United States, creating tens of thousands of jobs.
Now, lets say we ban foreign manufactured media playing devices from being sold in the U.S., and now *CHEAP* DVD players are $800 (of course, assuming the same escilation of pricing, you would expect a good quality one to be around $8000). You have made DVD players into a luxury good, outside the realm of afordability to a good chunck of Americans. Not only are stores selling less DVD players and DVDs, but Hollywood cuts back on movie production because they can no longer recoup so much back from DVD sales (people without DVD players, don't buy or rent DVDs).
Now, if you look at the jobs that would be added to the U.S. by manufacturing DVD players locally, and how many jobs would be lost because fewer people could afford DVD players, it is easy to see you aren't creating any jobs locally by requiring that DVD players be made in the U.S. In fact, most likely you would end up losing a whole lot of jobs in the U.S..
If a company outsources IT, that can give free up money that it might use to make more TV commercials (which create jobs in the U.S.). Or it could free money to allow it to expand its retail outlets (creating jobs in construction and for the people working at the outlets in the U.S.). It could also allow the company to lower the price of its goods, meaning more people in the U.S. could afford the products being sold.
People are also ignoring the fact that as people overseas get more jobs and more money, they now have more money to purchase OUR goods and services. China, India, and elsewhere are now customers for many American products, unlike say Cuba, or Iran, or some other country that is economicly isolated from the United States because of artificial trade barriers.
Finally someone that gets it. It's pretty sad that people in China probably have a better understanding of market economics than people in the US. Basic economics should be one of the most important subjects we teach in school. The problem is that I suspect that politicians would *hate* it if people had a better understanding of economics.
They may be getting paid less than they were, but I'm not sure that qualifies as being 'substandard' pay. Since the 'tech bubble' caused overinflated salaries for IT people (which I think most people, even those in IT, would agree with) then the end of the bubble means that salaries return to a reasonable value. Everyone I know in IT, including myself, is making plenty of money, so I'm not seeing a problem. Finding your first job out of college can be a pain, since everyone seems to want people with experience- but once you're in you have a lot of options to choose from.
You are reading a copy of my copyrighted post.
'Would you like to see the menu?' he said,
'or would you like meet the Dish of the Day?'
'Huh?' said Ford.
davecb5620@gmail.com
That same flawed logic is what drives RIAA and the MPAA to massive lawsuits.
And they win.
Any job losses from outsourcing are made up by the hordes of quality people you need to keep your outside vendors under control. It still doesn't work out, you pull the outsourced labor back in and need the quality people to fix the mess. Long term it probably leads to a net gain of jobs.
</cynicism>
thegodmovie.com - watch it
Wages exploded in certain sectors during the boom. Even overhaul, wages were growing much faster than inflation during the last economic run-up... Jobless was low, demand exploded. If it wasn't for off-shoring of jobs, we'd have probably had exploding wages (the supply of labor is pretty static one you are under 5% unemployment, so you start poaching people and wages grow fast), that sounds great in the short term, but it causes run-away inflation real fast, which either eats up wealth of EVERYONE ELSE (non-IT people do exist, and they have mortgages and bills to pat as well, and 10% inflation would devastate them), or would have caused the Feds to jack rates so high that a recession was started (you need to suck the excess cash out of the system, getting it into savings accounts/treasuries would have been one solution, otherwise prices skyrocket when more cash chased the same amount of goods and services) which would have collapsed the stock market.
.5% raises, so they are in trouble.
Why are wages not growing fast (well, they are now, and did in the second half of last year)?
I propose that it's short term thinking.
In the long term, wages grow at around inflation + 1%. If you ran the numbers from 1990 - today, I bet you'd find that wage growth was pretty much inflation + 1%. However, if you look at 1995-1999, you probably had more growth, and in 1990-1994 and 2000-2006 wages growing a bit less.
However, all people notice is that in the 90s, they were doing awesome (wages growing nicely, stock market growing nicely), and now they are suffering, because they got used to inflation + 2% raises, and are now getting inflation +/-
If US companies are doing well profit wise (which they are), then those profits go into: A) share-buybacks, B) expansion, C) dividends, D) salary increases, disproportionately at the top. The money HAS to go somewhere. Not seeing good investment opportunities, there have been a LOT of share buybacks, and dividends have been growing nicely (my blue chip stocks have been getting 8% - 11%/year dividend increases). The net affect is that the shares are worth more (EPS goes up as shares go down, though it is a lag factor because of weird accounting rules).
The problem people have is that in this latest run, those with capital deployed in the system have done well, while those without capital have not done well, because the wage growth hasn't been there. This absolutely sucks for lower-middle class and working class people, and it also sucks for people just starting their career. There are winners and losers, but you have seen wages inching up, and until the next recession as long as unemployment stays low, wages will keep growing.
In the long run, returns on capital investments run at 8%-10%/year, wages grow at around 1% or so (both are in real values, after inflation). However, in the beginning of an economic spurt, capital returns are higher (because they get really depressed in recessions, most of the money made in a bull market is made before people realize that there is a bull market), and at the end, wages pick up because the job market gets sucked dry.
However, wages are downward stick. Stock prices can and do drop 10%-20%, companies can't lower wages 10%-20% generally, because people can't take less, so you end up with fits. Unfortunately, wages get all their lift in the back half of the rally, then they stagnate for the recession/pull-back and early rally, and workers wonder why they are no longer doing well and everyone else is. However, the tail of the rally, when capital returns go flat and wages keep growing (wages growing, interest rates grow to stop inflation, and capital returns get sucked up by inflation plus rising interest rates), workers don't notice that they are doing better than the suppliers of capital.
Part of the reason that young people are more economically left than right is that with a shorter view of the market, they extrapolate their experiences of 3-5 years across 40 years and
I read somewhere the other day (probably on /.) that we have outsourced so many jobs in to India that India in turn was outsourcing it's internal IT needs. I literally about had a heart attack this made me so incredibly mad. You know on the surface level, yeah it sounds kinda like an over-reaction but all of this is going to end up in our laps sooner than we think if we keep this trend up. So it's a given that almost everything that you bought electronic or nic-nac wise was made in an oriental country, we are used to that. So it's a given that an overwhelming (I've heard up to the 90th percentile)percentage of the total American wealth is controlled by far less than 10 percent of the population. Then you have immigrant workers (some legal, some not but that's not the main killer) who ship almost all of their paychecks right out of the country. Then we go and outsource A WHOLE COUNTRY WORTH (referring to India) of IT jobs that Americans would be willing and able to fill. I think all of us in the IT industry know that the top of the crust is easily employed and usually rewarded to the point of never leaving. Then you have a plethora of mid-range knowledge/experience people that have a hard time finding decent jobs due to the saturation of the market and idiotic middle management that has no idea how to hire good IT people. Then you have the bottom feeders, who don't even work in the industry anymore or even had a chance because of the saturation of the market. Now my question is, when you call a freaking help desk in the middle of the day for a replacement part or a work order you get a guy in a different country that cant A: Speak English or B: Help me in any which way shape or form one of the English speaking and ready to be properly employed American. If this keeps up I have no idea how America has a viable economic base to hang it's hat on. This is not even touching the trillion dollar deficit, sprawl-mart epidemic, frivolous copyrights, outrageous law suits, failing bi-partisan structure, xxAA, and the list really could go on but I've ranted long enough for one post.
Think of all the people who come in to the US from other countries to look for work. See the service industry. Tech companies have many foreign workers here on various Visas. Why are they here? Because jobs are here. Nobody complains when it's here. If the job is here, people come here. If your job moves to India, why not move to India to keep it and stop complaining? Sure, it may be hot there, but you'll be a millionaire the second someone sees your Nikes (or bludgeoned for supporting sweatshops).
"Oh yes, for sure we've treated artists fairly over the years. We've always payed their royalties promptly and fully." When the hand of the oppressor surveys itself and say "all is well," fools are baited.
Sure, the jobs are still here - and they are filled with H1B holders. I see mostly Indian H1B guys hovering around all the key IT-oriented office parks in town. There's jobs and then there's filling them with capable and willing citizens. This whole thing is a massive sham and there is NOBODY to protect us.
shock the monkey
Offshoring does shift jobs. Yes, computer science jobs ARE lost by offshoring when jobs move to lower wage countries. This has happened to many industries in the past and is currently happening to computer science. However, what usually happens is that new jobs crop up in the country that lost them. Unfortunately this is often in a field different than the people that lost the jobs so they must retrain.
Consider the alternative. If you didn't offshore, you would be more inefficient than competitors that did. And in this global economy, you would lose in the long run since the most competitive position would win. In Eastern Europe they had to shut down factories that couldn't build items as good or as efficiently as the West. Also, American car manufacturers have been forced to put out better built cars.
You also have to realize that this isn't a zero sum game. You don't win if the other country does poorly. You win if you and the other country both do good. If they do good, they can buy stuff from you. We are all in this together.
Structural shifts like this aren't pleasant, but unfortunately necessary. It doesn't feel any better though if you are on the receiving end (like I am).
First off not all call center employees need to read scripts. A lot do, but I wasn't one of them. I had over a decade of experience with computers before getting that job. Like a lot of the people working there (or at least most of the night shifts), I was using it to pay my way through college. Second a lot of people lost jobs other than just the people on the phones. Managers, trainers, senior techs (the guy that gets to actuall figure out how to fix it when the front line tech that may just be reading from a checklist can't figure it out), janitors, etc. BTW I was one of the senior guys answering questions from front line techs and then later a trainer. It's just too bad that a lot of call centers have low hiring standards and only gave us 2 weeks to train someone. Yes, the majority of call center techs NEED the checklists and the scripts, but not all of them. Besides most Americans would rather get there tech support from someone here than trying to deal with a language barrier and still having the tech read from a script either way. As to me not having skills that are sought after: I finished that degree with a couple minors added to it, went on the get 2 master's degrees, ran my own business in grad school (that was profitable enough to at least pay the bills and help pay for the degree), have years of R&D background, have development and project management experience, and now have a very nice job in the IT sector.
Because I see a lot more Java/JavaScript/etc jobs posted than C/C++ jobs. I figured the Indians were just given most of the C/C++ jobs, leaving the noobie languages to us. But if that's not true, what's becoming of all the C/C++ jobs then? Why is almost every single god damn job description like this: "LOL Java+JavaScript+Ajax+Web2.0+Scalable Dynamic XML Enterprise Revenue Leveraging SQL Spread-Tabled Turnkey Solution Systems+oh yeah some Visual Basic 6.0"? That's NOT what I majored in Computer Science for.
Personally I'm not sure what my opinion is on the free-trade vs. job-protection continuum, but since you seem to have an opinion, perhaps you can give you thoughts on a question that's been bugging me for a while.
What, exactly, is the long-term, steady-state outcome of globalization going to look like for the U.S.? I mean, it doesn't seem like what we're doing right now is really sustainable. Massive current-account deficit (trade deficit), loss of manufacturing capacity and jobs in exchange for service-sector jobs, etc. I keep hearing people say that "the future is the service sector," but forgive me if I'm econometrically challenged, but I'm not quite sure how that's supposed to work, long term.
If all we have left is service sector jobs, and we're basically paying each other to do stuff, while at the same time importing all our manufactured goods from abroad and exporting little to nothing (or at least less than we're importing), how do we keep going? It seems like that's a ticket to economic collapse. There's no way that people here can compete on wages with folks in Asia and other parts of the Third World, just because of the cost of living, so eventually all the jobs that can be exported and offshored, will be. The only jobs left are ones that have to be done in person: doctors, lawyers, truck drivers, waiters, etc. But they're all selling their services to other people in this country, so in the long run, you're still hemorrhaging cash.
The line I keep hearing from politicans is that, somehow, "American innovation" is going to keep us so far ahead of the rest of the world technologically (apparently forever) that we'll be able to sustain this lifestyle. But I don't see that happening. And frankly, the basis for it seems suspiciously ethnocentric/racist. Now, I don't particularly care about ethnocentrism or racism per se, but in this case I think it's leading to a fallacious assumption, namely that Americans are somehow naturally superior to the rest of the world, and that we'll naturally figure out a way to stay on top, even when we're driving cars made in Japan using gasoline from Saudi Arabia and watching DVDs made in Malaysia on players produced in the PRC. I just don't buy it. Our educational system isn't that good, and a country filled with unemployed people isn't exactly going to roll out the welcome mat to immigrants, no matter how skilled they are (particularly if they're skilled, in fact). That we've managed to maintain the lead in technological development over the past 100 years is remarkable, but there were also two World Wars in there to spur development (not to mention razing much of Europe), plus waves of economic expansion and immigration, and a whole lot of luck. It's enough to make a nation dangerously cocky, and as an American, that worries the hell out of me.
So what exactly does a first-world country that's gotten accustomed to a very high standard of living do, in the brave new world of free trade? I'm just not sure I see a way out through that, which doesn't involve either a sinking average quality of life, or hyperinflation followed by economic collapse.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
According to Lucy, if the dress is on sale for $20 off, then buying two of them makes her $40 wealthier to spend on a fur coat.
In the real world - no.
Can we tag article headers as flamebait yet?
You have to get a work visa, which they won't let you have, then learn their language, and then you have to have "East India experience"... which means the company won't even hire you if you're an American. East India doesn't have antidiscrimination laws.
Or workplace safety laws.
Or pollution laws.
Which is why these companies go offshore: they can be as dirty, abusive and discriminative as any psychopath wants to be, without fear of regulation.
Say hello to undermining the entire credibility of western civilization.
Or: if you want to be competitive in the global economy, you will one day be reduced to living with 8 other people in a one-room, dirt-floored shack, making a fraction of what you could make today, while trying to pay for skyrocketing health care when your body is utterly destroyed by sulphur emissions, smog and polluted water.
--- Grow a pair, liberals... stop letting the Republicans bully you!
Yes, we all know how trustworthy and much loved those organizations whose acronyms end in AA: RIAA, MPAA, and ITAA. So, I have no doubt that SIAA is a truthful and honest and accurate as the afformentioned organizations. And, of course, there is no correlation between H1B number reductions and the increase of offshore jobs. Not to mention that older and more experienced workers are much valued.
We all have a right to live in a carboard box. We all have a right to starve. We all have a right to be miserable and poor. You do not, however, have a right to a shopping cart to push your belongings around in. Handy tip - For a cheap drunk, Listerine is 40% alcohol. Even if you stink, your breath won't.
America is not only addicted to oil it's addicted to cheap labor and has been so since day 1. From indentured servants and slaves to Irish and Chinese to Italians and Polish to high tech coolies from India and "undocumented workers" from Mexico and Central America.
Today's big business maxin: Give a man a fish then you'll realize no profit. Teach a man to fish and you'll create a competitor. Giving only works if you can create a repeat customer. So give a man a pack of cigarrettes instead. He'll be back to buy more.
"You'll get nothing, and you'll like it!"
The company I work for basically implemented an unoffical policy for its IT staff that all new hires would be in India. In 3 years they've gone from a few 100 to almost 3,000 staff in various locations in India. If anyone left a US position they're job would be filled be a hire in Inida. Additionally, they moved much of the IT staff to suburban locations to "save costs", which basically meant anyone who left the firm instead of moving, their manger was required to hire a replacement in India unless they couldn't get qualified staff.
...
Posted anon, to protect my job
Most of the jobs going overseas are high skilled jobs - software testing is not a low skilled job, nor are the network admin or programming jobs that are going overseas.
Accounting, legal and even radiology jobs are going over as well. I dare you to tell any of them that they're low skilled.
Next?
--- Grow a pair, liberals... stop letting the Republicans bully you!
"Unemployment in the 00's is lower than unemployment was in the 90s. or 80s. or 70s."
Hey, you can always add McDonalds jobs, right? Because those are on equal footing with others that require a college degree?
Unemployment numbers are never a true picture of what is going on.
How many are under-employed?
How many switched job sectors?
Unemployment may be low but how many people can REALLY afford to buy a house on the wages they are paid?
"where the statistics at large paint a different picture."
Statistics at large can paint any picture you want depending upon how you twist them.
"64 percent of all the world's statistics are made up right there on the spot
82.4 percent of people believe 'em whether they're accurate statistics or not"
- Statistician's blues, Todd Snider
The economic boon of the 90's meant nothing to an entire class of people, namely those at or below the mid-middle class line. Yet those "statistics" painted a very rosy picture, didn't they?
The simple fact is that the middle class is progressively being hollowed out. Menial jobs are more and more taken up by illegal immigrants and the bar for degreed jobs is progressively set higher.
It isn't sane to assume everyone will reach that bar. In fact, I bet you a shitload of people won't.
"I do not understand all the whining about lost jobs due to offshoring."
Let's make it simple:
1. Agriculture was outsourced (labor); many re-trained for factory jobs, many didn't.
2. Manufacturing was outsourced (skilled trades); many re-trained for tech jobs, many didn't.
3. IT is being outsourced, engineering is being outsourced, (knowledge jobs); many re-train for sales and management jobs; many didn't.
4. Sales / Management jobs are next, what will you retrain for, healthcare? There is talk about shipping that out..., etc. etc.
So where does it stop? You see the bar rising?
Is it really sane to have an economy where you produce nothing, import everything? How can you sustain that? You can't. It's gonna fall.
There's two terms here that are being used interchangeably that should not, lost and cost.
Given that the bulk of the outsourcing is expansive in nature then it would be inaccurate to say the jobs that are created are jobs that are "lost" to the US. It's quite possible that the company wasn't willing to invest in the project at the cost it would have taken to open it in the US but was willing to invest what it would cost offshore.
Were the scenario such that both were cost effective but off shoring was the cheaper solution then yes jobs were lost to Americans.
In keeping with the RIAA analogy, yes the RIAA is taking it to an extreme to say that allofmp3.com owes them 1.65 trillion dollars (did anyone else imagine Dr. Evil when they read that). But a swing in the complete opposite direction would be wrong as well. While every person who ordered from allofmp3.com or pirated from limewire would not have necessarily purchased the song they were seeking there's no doubt that plenty of people would have acquired the song either way but chose what the thought was the optimal venue.
You've reminded me of something my economics teacher once taught me. He mentioned a survey which asked:
"Which of these options is better for the United States Economy:
A. U.S. GDP rises 4% and Japan's rises 12%
B. U.S. GDP rises 2% and Japan's rises 1%"
Most respondents picked B.
You are reading a copy of my copyrighted post.
Not true at all. In the US labor is free to chase those jobs to strong markets. A construction worker in Maine is free to do construction work in Las Vegas, assuming he can get a job if he is a non-Hispanic. Most of the professional programmers on this forum can attest to that. They are not free to relocate to Bangalore. Tell your bullshit to a guy with a family who is about to lose his house, or to almost everyone else who have to switch jobs every 2 years to stay employed. I admire the US economy, but why should expect middle class professionals to take it up the ass and ask for more?
an ill wind that blows no good
How you can tell this is an industry PR fluff piece:
SIIA said respondents claim to be meeting 80 percent to 100 percent of cost-saving goals.
That's a big, fat lie. I've never met the project that got even remotely close to their cost saving goals from an outsource vendor. 100% bullshit is more like it.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
Well, maybe not mine, but someone else wanted/needed the job you have. Funny how people like you think of karma as something that only effects other people...
It doesn't free up those people to satisfy some other demand, it impoverishes them. Throughout history, the very, very rich have concentrated wealth, leaving the crumbs for the survivors, even when there was no reason to do so. What changed that, oddly enough, was the Military Industrial Complex along with massive Government spending on public works projects (most of which were roads built to make cars a viable and necessary transportation system so GM could sell you a car :) ). Take away Gov't spending on war and roads, and all that money goes back to the very, very wealthy, and the rest of us poor dumb shlocks do go off to some magical la-la land to satisfy demand, we starve in the streets, and blow each other up with in half hearted attempts to improve the situation (read: sectarian violence).
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Try moving to India some time. Tons of East Indian people come here.
Offshored jobs aren't replaced by better ones - they're replaced by low paying service jobs. There are a flood of high end jobs that no applicant in America is qualified to fill: you can't get those jobs without lower end job experience and you can't get lower end job experience anymore because it has all gone overseas.
Now, I suspect you'll be telling me all these success stories about college students paying for plane tickets to India and how they bribed Government officials to get work visas to work at these offshored jobs so they could get the experience they needed to work at the high end jobs in the US. It should make an interesting read!
--- Grow a pair, liberals... stop letting the Republicans bully you!
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
That is the same "logic" that calls a reduction of growth in a budget item a cut of that budget item.
James
0% unemployment means that nobody is looking for work. That's absolutely absurd.
At any given time, someone will be fired for doing a bad job. That person needs to look for work.
At any given time, some positions will be eliminated, because the company doesn't do that any more, those people need to look for work.
At any given time, some companies will go out of business, causing people to look for work.
At any given time, someone will hate their boss, quit, and go look for work.
At any given time, someone will leave the workforce, then one day decide to return (left to be a full-time caregiver, retired and changed their mind, etc., and they will look for work.
At any given time, someone will graduate from school (high school, college, tradeschool, whatever) and look fro work.
You cannot have 0% unemployment, because sometimes, you will have people looking for work.
You cannot have a minimum wage, and 0% unemployment, because a free market will naturally have some jobs under that minimum wage, and you are preventing it. Some people could no doubt be employed at $2/hour immediately, that cannot be employed at $5.15, $6.50, $7.25, or whatever your local minimum wage are, at least no immediately.
You cannot have the government charge a 10% employment tax on people, and have full employment, because some jobs that would get filled by a person at $X will not get filled for 1.1X, and some people will not take 0.9X to do the job, even though the company is willing to pay X.
The middle class has had a few years that were rougher than the years before, and let the revolution begin? America has the lowest unemployment of the first world, the highest per-capita income in the world, and because of a going through a structural change wages have not grown as fast as in the past, and we're suddenly living in poverty?
is what he really means
It is interesting to note that most people here (especially many whose positions were lost) seem to believe that the outsourced labor will always turn out to be of inferior quality and lower productivity.
That has not been the case at the company I'm working for. When several of our clients outsourced their operations and systems operations to South American countries with high levels of literacy and good English skills, they saw a tremendous turnaround in productivity in relation to their American counterparts. They saw work being done in a more timely and efficient manner because of a more focused and motivated workforce.
I'm sure that's not the case most of the time, but it's certainly a reality here that has been repeated many, many times. And where things are still not working out perfectly, there's staff that's acquiring experience and English skills and looks at the prospect of a juicy salary and opportunities in a growing market.
Be on the lookout. Those people that so many of you here denigrate for being inexperienced and inefficient will one day be seasoned professionals. Remember that you were like them once.
The real reason that jobs are not being lost is that these are not the jobs that U.S. citizens want in the first place. What software engineer in there right mind really what to program in .Net or do QA in the U.S.
This is just no different then all the illegals taking justs in the farm fields and in the slaughter houses.
Just think how luck we are to have other countries do the jobs that no one in the U.S wants like ...
Wait a minute, someone has just walked into my cube, sorry I have to go, I've just been off shored ....
you can't get any experience being on the team?
If you can't get an entry level programming job because it has gone overseas, how do you get the experience to become a senior programmer, and then a team lead?
Or do these team leads have no programming experience at all? *eek*
--- Grow a pair, liberals... stop letting the Republicans bully you!
What about those who are laid off so their jobs could be sent to India? Someone above mentioned Intel as a case in point.
Those are flat-out job losses, as opposed to "potential job creation".
Fascism starts when the efficiency of the government becomes more important than the rights of the people.
>'[Offshoring] was used almost entirely as a form of expansion, not as a replacement.'
Yeah, coz I'm sure he'd have no problem if I took all the interest he made on his investments and put it in MY bank account. He wouldn't lose money, so he'd be perfectly happy, right?
Nostalgia's not what it used to be.
Sure, we'll all be fine -- theoretically -- in the long run when $ equilibrium has been reached across the countries, etc.
But, do you expect that to happen without massive and painful social upheaval? I don't think many people are philosophically opposed to competition. But, practically speaking, we're in for lots of trouble.
It doesn't matter what country a person lives in, they have every right to a job that an American does. I get SO sick of whining Americans! Especially when the jobs we're talking about aren't exactly unskilled labour--it's well-off people that are losing these jobs, not poor people barely able to make ends meet.
What we should be concerned about is that foreign workers are not paid any less than American workers. This is what is most troubling. When workers are paid the same for the same work as they should be, then companies will employ those best equipped for the job, regardless of where they live.
I, for one, am sick and tired of getting a new 4 year degree every 6 months just to keep up. Stop the train, I'm getting off.
Opinion:=TMyOpinion.Create(Me);
IIRC, according to Standard Macroeconomic Theory(TM), a country's employment rate primarily depends on the national savings rate and the interest rates set by the central bank. If savings are high and interest rates are low, then it's easy for businesses to get capital and hire people, and you have low unemployment.
But the US has an extremely low national savings rate. The Treasury has to print up all these bonds to finance the Federal budget deficit, and American investors aren't interested in buying them all up. So we rely on foreign investors, especially the central bank of China, to provide that financing. The foreigners, of course, have to buy the Treasury bonds with US dollars. How do they get those dollars? By selling cheap stuff to Americans.
So offshoring is not a cause of US unemployment; it is one effect of bad political decisions here in the US, and unemployment is another effect of those decisions. There are things that the US government can do to encourage employment in the IT sector, and things the US government can do to soften the damage that people get when they lose their jobs (for whatever reason), and people can have all sorts of arguments about which of these things would be good policy. But "Blame India" is just bad economics.
If foreigners weren't interested in buying up our debt, then the Treasury would have to hike interest rates to make its bonds more attractive to American investors, which would seriously raise the US unemployment rate--investors would move their money from low-ROI private-sector investments to bonds, and the companies that had depended on those investments would have to fold. So in a sense, we should be grateful that all these Third World countries are itching to sell us cheap DVD players and cheap Java programmers.
(There are second-order effects that aren't captured by the above Macroeconomics 101 analysis: for example, both China and India have currency restrictions that make American exports to those countries more expensive for their own citizens. But the US budget deficit and national debt are so huge that I don't think these effects have a significant impact on US unemployment.)
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You look at it like there are 2 options.
1) keep the jobs in the states
and
2) move the jobs overseas
in fact there's usually much closer to this
1) close the factory and eliminate the jobs because it's not profitable where it is
or
2) close the factory and re-open it somewhere profitable.
Think about it this way, if the US was the only economy how many things simply would never get made because there's no way you could make it profitable with US labor. Many times the decision isn't to make it here or make it there, it's make it there, or not make it at all.
that's because the U. States has the world's EASIEST immigration rules. That and Americans going abroad have a good chance of being kidnapped, killed, raped, tortured, etc. Moreso now since Dubya came into office.
Or, to extend the analogy, buying from allofmp3.com is *expanding* my musical purchases, not *replacing* them. So it's okay! Whew, what a relief: I'm sure the RIAA will be thrilled.
Nostalgia's not what it used to be.
Studies nowadays seem to be done with the desired results in mind. Truth is nothing is as simple: some outsourcing costs US jobs, some doesn't make a difference, and some may even make US jobs.
The dynamics of this are too complex for an objective study to cover.
So we instead have tons of subjective fact-bending studies that show up on Slashdot. So what's new...
As I am not American, neither english, please bear my poor language skills. I'm trying here to bluntly summarize a few basic economic concepts. A outsourced job is economically speaking composed of both a import of a service and a loss of consumers demand.
.6c1, the highter c the better the multiplier.
;)
Outsourcing is a "import" of services for the cost that it implies. If you pay someone on foreing land then this is money spent to acquire the service equivalent to an IMPORT. Outsourcing is a LOSS OF DEMAND in this way: When a worker gets laid off it's weath decreases and it's contribution to the global amount of wealth consumption decreases ( Consumption in the equation below )
The canonical equation of Keynes for the demand of national economies is this:
Demand = (Multiplier) * (+CONSUMPTION -IMPORTS +Exports -Taxation +Public Expenses)
The multiplier is constructed as "1/(1-c+m)" whereas c=% of income spent on internal consumption and m=% percentage of imported consumption. Usually
So outsourcing decreases Consumption, Raises Imports and can be shown that in the long term also the "c" factor of the multiplier is affected. In the end outsourcing is very bad for national demand. And as you realize strategic choices about production are all based on demand: a poorer demand means additional job cuts.
The US are not known for their outstanding public welfare, in your pants I would call for regulation of the subject
Enrico
The article says the study was from the Software & Information Industry Association. I've never heard of them. http://www.siia.com/
Does anyone have any similar articles from a good source like the ACM or IEEE?
...the real reason for offshoring has little or nothing to do with rates of pay, and everything to do with environmental and OSHA regulation.
Large corporates have made the decision to rape and plunder other nations resources, and to poison, maim, and humiliate their masses. I suppose we should be grateful really.
I just don't look forward to 1 billion pissed off Indians when they finally 'get it'
OK, I went to the DOL statistics website, and what I see doesn't back up this claim. Specifically, the labor force in 1999 is listed as 117.1 million, and the labor force in 2002 is listed as 122.5 million. (Note: these are the "not seasonally adjusted" figures.) For the same time frame, "not in labor force" went from 68.4 million to 72.7 million. "Not in Labor Force, Want a Job Now" went from 4.6 million to 4.7 million, "Not in Labor Force, Searched For Work and Available" went from 1.2 million to 1.4 million, "Not in Labor Force, Searched For Work and Available, Discouraged Reasons For Not Currently Looking" went from 0.3 million to 0.4 million, and "Not in Labor Force, Searched For Work and Available, Reasons Other Than Discouragement" went from 0.9 million to 1.1 million.
I can't find disabled or displaced figures.
Ben Hocking
Need a professional organizer?
If the job could've been made here
Well that's quite the assumption. It seems more likely, to me, that if a job couldn't be outsourced, it may simply not exist, because the company can't afford to pay the domestic salaries necessary.
Similarly, me pirating a copy of, say, a $1000 program is not a lost sale, because without piracy, I wouldn't have been able to afford the software anyway.
Americans are not a "race". Spin the wheel of inflamatory words and go again.
I would recommend finding whatever word means the reverse of 'protectionism'.
The difference between a "Cd that is downloaded could have been purchased loss of sales" mentality, and this, is that the the job is actually created. Downloaded music is not an actual purchased, so your analogy does not apply.
I think you might misapprehend me. I'm not claiming everything's peachy, I know it's not. My favorite pair of statistics are the mean wage (rising) and the median wage (falling), which taken together obviously paint a picture of increased disparity. I was just thought that 20% was a might high number not to be making all kinds of news.
Why yes, yes I do. Of course, I'm currently back in graduate school... (On the other hand, if you include the fact that my stipend pays for my tuition, it comes out to about $41k per annum, I reckon, but that hardly influences "poverty".)
Ben Hocking
Need a professional organizer?
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This has a real and vicious impact on the families (assuming they can even form families) of American IT workers.
Seastead this.
Here's a thought I had. The US looks to be depleted in terms of tech workers, but so does India. I came to this conclusion when I looked at:
1) Increasing wages for Indian tech workers.
2) Increasing number of Indian applicants rejected for employment due to lack of skills.
3) Businesses such as Wipro looking to Malaysia, Vietnam and Ghana to find qualified workers.
So, in my extimation, over about 20 years we seem to have outstripped the supply of skilled tech workers in the US and India. If we do not do something about the quality of software soon, we will probably deplete S. America, China and Africa soon as well. All the low cost options will be gone, probably in less than 20 years. I haven't been able to determine the exact numbers, but the fact that the number of gadgets and applications continues to increase rapidly and than in only about 10 years we depleted the second most populous country in the world and the 4th populous country in the world.
The situation also looks bad if you factor in the EU, which is ranked about #3.
So, are we going to have to fix our crappy applications soon, since we are running out of cheap labor?
Thoughts?
putting the 'B' in LGBTQ+
"Expansion to where? Third world countries may benefit from having a pool of low-cost labor with little regulation, but that doesn't help the labor at home."
YOU, the entry-level people, have to move to Bangalore. In turn, the "top talent" of Bangalore get Visas and green cards to come to the US.
We don't want to train you! Go away.
Opinion:=TMyOpinion.Create(Me);
So, assuming that you've inferred the situation correctly (and it's the best I've heard so far), it sounds like the 20% claim is actually a conflation of the total number of disabled (~20%) and the fact that the unemployment rate decreased in 2003 (from 6.4% to 6.1%) due to a decrease in the labor force rather than an increase in the number of employed (a good example of the problem with the unemployment rate definition, but not the 20% claim).
If you're reading this MarxistHacker42, does that sound right to you?
Ben Hocking
Need a professional organizer?
but should it? Do we, as a race, really want life to be Dog eat dog? I know the rich and wealthy do, since they benefit enormously from the struggle. Me? I'm not so Rich and Powerful, so I'm more of a social welfare / safety net kind of guy. In my experience, in a modern, mechanized society there's usually enough people to get the work done even with a few welfare marms anyway (just as long as you an keep the dumb from breeding out of control).
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I have yet to meet anybody in Detroit (and I lived in MI for 15 years) go into debt with student
loans so they could learn to fit nut A onto bolt B. Comparing task-based assembly with the
modern skills needed to build software (communicating with customers, unit testing, integration,
design & design patterns, refactoring, multiple computer languages, framework knowledge,
OS knowledge, databases, & ongoing professional development) is insane. My father got paid
a tidy sum at the time in the late 70's to seal and fit the back windows onto GM cars. With only
on the job training and a barely passed high school diploma? That's a windfall. Not something earned.
His work tallents could have been just as well applied to sweeping floors & emptying trash and he wouldn't
have made nearly the same money.
The real problem? Software development & other IT people are PROFESSIONALS who have to build and
maintain professional skill sets through self-study and/or taking new job opportunities. The cryin' shame
is that we aren't smart enough to set up a cartel like the lawyers (bar assc.) and doctors (medical board) do
in order to prevent competition from low-quality & low-wage sources as well as establish peer-review for
the needed skills and recognition in hiring process.
*** Sigs are a stupid waste of bandwidth.
Offshoring IT jobs most definitely reduces the number of IT jobs in the US. It may be that a company will end up employing 1.8 foreignors for every 1 US citizen displaced, but there will still be less IT jobs in the US because of it. A tiny fraction of the money returns to the US as increased demand by the foreign workers for US goods and services. So now the former IT workers can try to create media content for Disney to sell the [insert favorite 3rd world country here] workers or wait tables at Ruth's Chris, where the CEO dines. A few unlucky few get to stay on as project managers and experience the frustration of trying to accomplish things across physical distance and cultural gaps. CEOs/CIOs/Investors reap the rewards. Effectively, offshoring transfers wealth from the middle class to the rich. A little of it gets transferred to the supposedly poorer citizens of other countries. Of course, those who love programming will eventually find jobs for much less, as they're now competing for small change with someone in a Less Developed Country. Don't forget the bigger threat to US citizens' jobs-- H2B visas. CEOs/fat investors, who control most of the US government, keep the doors open for foreignors to take jobs in the US where they've deemed there exist "critiical shortages." Critical shortage, in CEO-speak, means they see an opportunity to take more of the profits for themselves and pay employees less -- drive down wages in the IT industry. Oh yeah, and for the comment about companies' intentions to grow and then employ more US workers too... if the top priority is growth, the CEO needs to be fired for failing to do his job: maximizing profits, earnings per share, return on equity, etc. Profits may follow expansion, but many think they follow cost-cutting, so that's what occurs much of the time. (Short-sightedness, related to a ridiculous focus on quarterly profits.) The big difference here is that textile workers wanted employment. Most didn't particularly like working in textile mills. IT workers often like the work itself, and the work generally requires education and provides challenge. You know, things valuable to a healthy society.
While making some valid points, you fail to recognize that the foundation our economic stability is built on is being eroded by the multinational conglomerates you claim are doing the damage, but not for the reasons you think. The damage comes from people who are willing to take minimum wage jobs and then try to hold on to them for 20, 30 or 40 years. America wasn't built and isn't stabilized by the 'economic elite', it was built and IS stabilized by disruptive players and hard work [if you've had the same job for 40 years... you're not working hard or smart]. We all know that the technology industry, the MULTI-BILLION dollar technology industry was sparked, built and expanded by relatively unknown players with big dreams - like Steve Jobs. If you have a bachelors in Computer Science, why would you condemn yourself to 20 years of programming? Why not build your own company with your own big ideas? When Americans stop dreaming, building, or doing, we'll collapse. That will happen regardless of who has the money.
We have a lot of uninsured that are young and don't want to spend the money. If they get hurt they can go into a an ER and get patched up without money or insurance, so why buy it? If they have a huge bill they just declare BK. Problem solved. Another big chunk of the uninsured includes illegal immigrants. Without those groups, the number of uninsured is pretty tame.
We have less vacation here because it's required by law in Europe. We don't want that. Your house payment due next week? Too bad, buddy. It's vacation time. No rational person would favor the Europeon work environment over the US. Look at their unemployment and especially long term unemployment. Many Europeans go for years without a job.
If the goal is to "Break Americans out of the middle class and put them into poverty" then we missed by a wide margin. Our "poor" people have cell phones, cable TV, cars, etc. Not many countries can say that. What you've missed is the opportunity for our poor people to buy more with their limited income because free trade lowered prices.
Oh, the Software & Information Industry Association. A group composed of the people *responsible for outsourcing*, so of course they're going to come back and say it's not costing American jobs.
The Indian outsourcing team getting too expensive so guess where we'll be shipping this work off to next time? China. Might as well set up shop in Nigeria and be done with it -- save a lot of time and effort in the process.
When they ask IEEE or ACM members these questions, then I'll listen. All you pro-outsourcers can drink the cool aid all you want. There are very few jobs that can't be outsourced, probably including yours.
I'd suggest you work on your
SIIA is a lobbyist organization for big biz. You cannot trust studies from lobbyist organizations. Their "studies" almost always say what they want them to say. You might as well ask for a Cost of Ownership OS study from Microsoft.
Table-ized A.I.
As a final rant, the H1-B program must stop. There are plenty of smart minds here in the US capable of innovation. Education analysts are confused as to why so few Americans are interested in science, technology, and engineering. They blame it on inferior education, lack of ability, etc. The fact is they miss what is directly in front of them. There is NO INCENTIVE to get education in these areas because there are NO JOBS available and what jobs are available are constantly threatened with OFFSHORING. We have become a service economy and I blame the politicians and lobbyists. NAFTA basically was the beginning of the decimation. Other countries laugh at us all the way to the bank, folks. It's time to wake up and smell the shit our government shovels and rescue our economy from the bowels.
Right now, we hear about the so-called healthcare revival economy. Again, folks, this is a service-based industry. This is the last bastion of US strength because there are adamant attitudes against foriegners keeping labor importation for the field, nicely low. The baby boomers want to be treated by someone whom speaks English WITHOUT a strong foriegn accent (UK, Australia, and New Zealand non-withstanding.) The baby boomers hold a large chunk of the material wealth and therefore have some say in the situation. I for one, have tossed IT in the toilet in favor of going back to school to become a Radiological Technologist.
Finally, you as the consumer have some say. When you speak to your computer manufacturer, insist on someone in the US. Be rude about it if you have to. Stand up for your rights.
Ok smart guy, lets take that argument to its logical conclusion... we eliminate everyone in the world, except you. No one is competing with you for a job. Are you better off or worse off?
That's not a "logical conclusion," it's a very poor reductio ad absurdum. It doesn't even make sense. Try again.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
yea, tell that to my sister and the 60 other people from her plant that lost their jobs when it went to China and some of it to the prison system.
There isn't a single IT job that was around in the 1990s that isn't thriving now.
It just isn't allowed to thrive in countries where workers are treated like human beings.
--- Grow a pair, liberals... stop letting the Republicans bully you!
I think some insights from the field of economics would be helpful in determining the net effects of offshoring.
First, there are many software development projects which are "on the margin" meaning they're not profitable if developers are paid $90k but become profitable if developers are paid $30k. As a result, reducing the cost of software development by hiring Indians will cause marginal software projects to become profitable, causing more software projects to be undertaken than otherwise would. In other words, just because someone is paying an Indian $30k to do something does not mean he would otherwise be paying an American $90k to do the same thing; instead, without the Indian, he might not pay anyone to do it.
Even if there is still a net loss of programming jobs to India, that would just mean that the embedded cost of software would go down, because companies like Wal-mart would have to pay less to Oracle, IBM and SAP in licensing fees etc. As a result, their prices would be lower in any competitive market. (Note that the cost of enterprise software is an "embedded cost" in many of the things you buy). Furthermore, consumer prices would be lower for things like computers and software. As a result, people would have more money to spend on other things, and employment would expand in other sectors.
Although demonstrating it would require several more steps, we can be certain that offshoring will not lead to a net loss of US jobs across all sectors, and that the average American worker will have his income increased rather than decreased by it.
Also note that Americans' programming skills would not "go to waste" when they're laid off and forced to take jobs at McDonald's. American programmers could simply get jobs at $60k/yr rather than $90k because they would be much more competitive relative to Indians at that salary, but would still make more than working at McDonald's. At the new salary, many offshored jobs would move back. Only when the average programming job pays $7/hr would a programmer be tempted to abandon his skills and work at McDonald's. That could only happen if programming talent were so abundant worldwide that an American programmer's skills would be nearly worthless anyway. At that point it would benefit both the economy and the programmer if he learned to do something else.
It looks like someone hit a nerve in the Slashdot 'community.'
"it may simply not exist, because the company can't afford to pay the domestic salaries necessary."
Reread my comment. I say "which they could still afford" which means they could afford domestic salaries. That is my starting point. Many of these companies can afford it, they just choose not to for the sake of maximizing profits.
"Similarly, me pirating a copy of, say, a $1000 program is not a lost sale, because without piracy, I wouldn't have been able to afford the software anyway."
My example was for someone who could clearly afford the product but chose not to pay for it. In my example the person obviously could afford to pay for the CD because they bought it then returned it (I see this with used DVDs all the time) so they could get a free copy. I agree with your logic but that wasn't what I was talking about. If you bought the $1000 program then returned it after making a copy then that would be different, yes?
It is by the juice of the coffee bean that thoughts acquire speed, the teeth acquire stains. The stains become a warning
This industry trade group has planted the results of this study in a magazine they can point congress to when they lobby for more bad trade deals and temporary visas.
Wansu, th' chinese sailor
Yeah, I read all of you telling me how a job off-shored is not a job lost. I'll give you that. I'll even buy into the idea that you "may" expand the business to offer up some new (otherwise non-existant) jobs here.
My question is a what cost? Sub-standard working conditions? Slave wages/labor? A race to the bottom indeed.
It disturbs me that THESE issues are no center-stage in the debate. An AMERCIAN company should not be able to open up an office in India, ignoring American principles and working conditions because you are suddenly off our shores. It may save the company money, and even allow for expansion of the U.S. economy in the end, but you did it at the exploitation of the Indian workers you used by not offering equivalent pay/working conditions.
Opinion:=TMyOpinion.Create(Me);
There are people here who have pointed out that the world economy is not a zero-sum game. That, in many cases "a rising tide floats all boats." In general, that's true. But in practice it hasn't been so.
One of the problems with out-sourcing has been that technology has brought vast new labor markets online. But while these markets are rich with labor resources, they have a dearth of capital. So, in effect labor got cheaper but capital got more expensive. In the utopia of economists, the labor markets would bring new capital to their countries, thus increasing infrastructure development and creation of new local businesses, etc and ultimately raising the cost of labor in that market. But, in practice, most of the money that the out-sourcing firms have brought into their countries has flowed right back to the west in the form of things like US bonds (e.g. China holds billions in US treasury notes) and other investments. Thus bringing in a windfall for capital-owners without a proportional increase for the workers. Workers have seen increases, just not proportional increases.
Presumably this imbalance can't last - there are signs that the pendulum is already swinging back, such as the devaluation of the US dollar - but it is nearly impossible to say exactly when the labor/capital ratio will even out, or even if it will overshoot and swing in the other direction. Nor is it easy to say exactly what consequences such a change will bring either, although it might be wise to invest in foreign (non-western) markets.
Not sure if I understand your message: lawyer, marketing consultant, SOX commpliancy officer are not services jobs.
There are places in the midwest that would be comperable in savings to cities in the third world.
Using your barbie parts idea, say you take it to another country and set up shop. And 6 months later after your third dictator privatizes the mfg industry you are out of luck.
I don't buy into the whole cost savings bit. There are people in the midwest of the USA living on $10K a year. Taxes are low, there are incentives to build factories, and people who can be paid less because the cost of living is less. All of that and the added bonus of the security of being inside the greatest country on the planet.
2. You are not entitled to a job.
3. If someone else is willing to do the same work for less money than you do, too damn bad for you.
4. Yes, it is a race to the bottom. No, that isn't necessarily a bad thing in the long run. When you want to fill a container you have to fill the bottom first.
5. If you think you're better than the people 'your' job was outsourced to, prove it.
6. If things get too bad, mobs will drag those they deem responsible into the street and shoot them.
Can we really trust anything coming from an organization named SIIA?
The people who benefit from offshoring and H-1Bs were surveyed to see if they thought it was fair to US citizens?
Great. Allow me to heap scorn on the idea.
The survey is 100% brainrinse.
BWilde
The parent's arguement above is absolutely the correct one; global economic dynamics are as far from a zero-sum game as one can get, and there is most certainly a net benefit to the U.S. economy that comes from "off-shoring."
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I just want a minimum guaranteed standard of living for all mankind, and one that is as high as possible.
:) ), but what's it matter if 2/3'rds of your 'income' goes to social programs when you've got everything you really want and need? On the other hand, if you keep every penny you earn, but work 60 hours a week and die from lack of medicine, then you've got a problem there too. Yeah, I'm using extremes here, but it's certainly true that the rich and powerful exploit your desire to keep all those 'fruits of labor' to hold onto their wealth. I like to call this the "Bill Gates" syndrome: almost nobody is every going to be as rich as Bill Gates but damned if we'll touch his enormous wealth because we all lust after it ourselves, and if we take it away from him, we can't have it ourselves. The sad part is we'll never have that wealth, and we all suffer for allowing him to have it...
The problem with your attitude is, you're too focused on the 'fruits of your labor', and not enough on improving your overall standard of living. You're so concerned with the though of a few stray dollars going to someone undeserving that you're easily manipulated into working harder for less. Not trying to be insulting (although there's really no less blunt way I can say the above
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We tried to offshore stuff but they always screw it up. The onshore staff were not free to complain because, well, it would look like we were complaining about offshoring--not the work the Indian guys did. In short, of the hundreds of Indians we had working for us through Cognisant, about 5% of them could think on their feet and be creative. The rest would do what they were told and could just repeat code. But still, we always had to exercise trememdously-detailed oversight on what they did. I used to fear offshoring but after experiencing it for years, I know it will not work unless you are repeating what an onshore resource has already done to a T. In my experience--which is considerable--the great American advantage is our ability to think creatively and attach a problem several different ways. The Indians--even the H1B ones we brought on sight--were nice guys who meant well but they did not grow up in a culture that fostered creative thinking. They were trained monkeys, in essence.
My knee-jerk is to say, "Yuh-huh!! Are too!!!"
Think about it for a moment, Mr. Soda. What do lawyers, marketing consultants, and SOX compliancy officers produce?
If you can't think of a tangible product that any of these occupations yield, bring forth, generate, or synthesize, then the occupations fit the definition of services jobs. No physical product created? Service is all that can be claimed.
I think you may have narrowed your own definition of "services jobs" to "menial services jobs." For example, every politician is a service provider. So is Slashdot.
When I'm really inebriated and need to come down fast, I just think of how many manufacturing concerns there were in the US 20 years ago. Then I drive home and count the number remaining in my community. Guaranteed buzzkill.
If, for some potent reason, I'm still high, I contemplate how the US once exported finished goods. Now we export raw materials and buy finished goods. Then we sell them--with excellent customer service.
"Press to test."
(click)
"Release to detonate."
Sorry, that's hooie. Joe worker is in no position to compete when his costs remain the same and are relatively high compared to the nation that the capitalists can ship their capital to. If it's only a few percent, sure, possible, but to say someone in the US can live on a buck an hour or 5 bucks a day (whatever, some absurdly small number) is just retarded, because they are saying you should be able to compete at that price. And it *is* black and white that way. The big company says they'll ship the job to where they can save on the labor, to increase their bottom line and some CEO salary by a few million, because it's insanely cheaper there, yet they want the same loot for the product.
Yet, I am not seeing any big push by the capitalists or their stooges in government to drop rentals or mortgages or real estate property prices, or even freeze rates by law,nor utility bills, nor cost of transportation, nor local property taxes to pay for the illegals invasion, etc, none of that. You can go to the poorest cheapest cost of living place in the US and you still couldn't live on a buck an hour, even if your house was completely paid off and your car was completely paid off and you never needed new clothes. You still couldn't do it. Our society was set up over a long period of time the way it was, certain costs and obligations, and wealth gradually built up over a lot of manufacturing and then a ton of internal trade. You lose it as a worker in the middle of paying off a house and car and etc you can go down the tubes fairly readily now, and you do it in some area where the bulk of the adults are all in the same industry and all of a sudden everyone is laid off you can't even hardly sell your house. It's happened to any number of millions of people and this year with the ARM rates going up it is going to get worse.
And you want even more proof that this isn't working? Easy! They have to cook the books on the economy to make it look good, use every possible word parsing tactic to call credit "wealth" and get people to believe that fairy tale, they dropped some of the FED reporting on cash in circulation to coverup the on purpose credit expansion by running the presses and just adding zeroes to the data entries, they adjusted cost of living and took out critical necessities to make it look good, they reclassified jobs, and we are now without any shadow of a doubt and this is not debateable, just accept it the most in the red any nation has ever been, all within the last 20 years of this big globalism push. If globalism worked, we'd see some results other than cheap crap at walmart. You wouldn't see so many people against it. We'd still be a creditor nation, not a debtor nation. And if you think debt is wealth, go ahead and try it on a small scale at your bank, try to get a big fat loan approved by using your other debt load as collateral. Go ahead, try it see what happens. But nationally that is what has happened in the US and you and they call it good? If we had a true, not fairy tale but true good economy, 30-50 year mortgages would be unheard of, and those interest-only mortgages they push now? Wouldn't exist. Back before the big globalism "offshore all the jobs you can jobs inshore what can't be offshored" push (the war on the middle class in other words) it was 10 and 20 year house notes max and 18 month car loans and total debt (government/corporate/personal) was extremely low and savings rate was high.
You may call trillions and trillions in debt a good economy, IOUs funding more IOUs trying to fund yet more IOUs, while the CE whatever class keeps getting chunks of billions per year because they "work so hard", but I call it one international dump the dollar panic run away from great depression version 2. And it's going to be much suckier than the first one when it happens. And it is going to happen, inevitable, it's too far gone now.
Many regimes and empires and nations have tried the fiat-fairy tale styled economy dodge in the past, to just paper shuffle busy wo
They may provide a service, but in the context of my original comment they are not. The service jobs increasing are cashiers, food servers, janitors etc...
"My anecdotal observation is that the majority of you who can not find equivalant work/pay were worthless to start with. This has been confirmed by a recent thread on Slashdot which discussed candidates that can not stand up to a real technical interview. If you work hard, are dependable, and competent within your IT discipline you will not be affected."
Since when has a discussion on Slashdot ever been a reliable way to confirm anything? With all due respect to your worthy CCIE certification, you aren't qualified to judge the competence of "EEs, CompSC, Chemical Engnrs etc". Even if your were, you've only seen a tiny sliver of the technology world and can't reasonably draw broad conclusions about competence from such a small sample.
I created this account just to answer this article.
Offshoring and outsourcing is the other side of the coin.
We, in the third world, have been buying the stuff you make since decades now.
We have McDonalds, Coca Cola, Blockbusters, Intel, Microsoft, etc.
It is often argued that we are loosing jobs by buying those products, that we should have our own industry. The general rule was to study here and go trying luck in the US. We have been relegated to agriculture and basic goods exportation, and because of the international value of those goods the local market value is increasing.
Now you are facing a similar problem. Should you "buy" our jobs?
To be honest, I think this is not in your best interests, those with jobs that are being offshoring will be left unemployed. But I also think it can't be avoided, that's the price you have to pay for being one of the richest countries in the world. What I would advice you is to adapt, move to another country. I know it is not an option for some of you, but those who can, should.
But I think in the long run it will be the best for everyone. Better salaries will in time make things better and increase the cost of living in third world countries, and offshoring will decrease the cost of living in your country.
You are just starting to feel the negative consequences of globalization...
::Think about it for a moment, Mr. Soda. What do lawyers, marketing consultants, and SOX compliancy officers produce? ::
Paperwork?
I have worked in IT for 27 years, sys admin and software developer, and I'm looking to get out.
Get a degree in law. In 15 years all Americans will make their living by suing one another.
They are missing the costs involved with the following:
Missed deadlines because offshore programmers said "yes" which really meant "uhm".
Botched programs because segments were distributed between groups which didn't communicate with each other.
Botched programs because American English wasn't there first, and often second or third language they knew.
Botched programs because they never really learned to program, they just memorized the answers to the questions.
Costs in having to re-write the crap code that's returned.
Costs in having to examine the code line by line to make certain that back doors and other problems are not introduced (especially if the programming is for a government entity).
Costs due to corporate customers getting pissed off because simple english grammatical issues crop up constantly.
Costs to keep high bandwidth connections between off-shore programmers connected to local servers so that customer data isn't *officially at least* sent outside the continental US.
Costs due to losing customers once they find out you've off-shored 1) Programming. 2) Technical Support. 3) Customer Service
Costs incurred in re-staffing in the United States once you've realized your cost savings plan actually cost you an additional 3 to 5 hundred million in costs.
Who is general failure, and why is he reading my hard drive?
u.s. software houses also are taking contracts from all over the world - there is a give and take situation.
also, for internet, for programming, you can never say that 'we lose national jobs'
Internet is a new nation, and you are the founding members of it.
ANY u.s. programmer can find phletora of contracts from all over the world if s/he puts a little back into it - even less work than they would do in a company who would suck their soul with little benefits.
work at home in your basement. work MORE, but in an easier environment with your family.
being in the u.s., you will always have a better degree of confident put in you by the offshore contractors, who know that violating a contract in u.s. would be punished much worse by u.s. laws than indian laws do for indians.
use this to your advantage.
I live in turkey, i bear the official nationality of turkish.
However, in fact, "im from the internet", as they say in the Simpsons.
With my 'developing country citizen' status, i can easily work for $15 an hour from where i sit. If i wish, i can rise this hourly rate higher and get a narrower clientele, but, you have to give when you take.
any of you can do anything right now. You all are internet citizens. live in it.
Read radical news here
If education is failing, coming generations are expecting more handed to them on a silver platter, and jobs in AMERICA are considered immigrant jobs, why shouldn't we expect more jobs to be outsourced? If American students are dropping out of school and then using welfare money to buy $100 shoes, I sure as hell don't want to employ them. I'd rather have somebody abroad who is competitively seeking employment and educating themselves. People always focus on the cost of outsourcing. I choose to focus on the reliability and capability of overseas workers vs. the American counterparts who would eat up all my costs through inefficient healthcare bureaucracy and common mistakes. Overseas workers might get paid less and have fewer protections, but they work harder to get the jobs they have. If the worker protections were the same in India as they were in America, I would no doubt choose the Indian over the American. Thomas Friedman put it best. The world is flat. If American can't compete, blame the legislators who took all the money from education and made it work for short political gain rather than long-term results.
No.... Job not added.
There is a difference. To lose something you must have already possessed it.
And yes... by this same, correct, logic deficit savings aren't.
I will never live for sake of another man, nor ask another man to live for mine.
In this example, no U.S. jobs were lost because no U.S. jobs would or could have been created to meet the need of the business.
Another point to consider is that we are now in a truly global market. U.S. companies cannot continue to be the grossly inefficient dinosaurs they have been over the past decades (and we are inefficient). So one point you could make is that off-shoring actually saves jobs since it is a way to help keep companies more efficient enabling their very survival and saving the jobs of all who remain employed.
Now, all of that said, do I believe that either of these two cases are realistic? Yes. Do I believe that off-shoring never costs U.S. jobs? No.
I'll just go ahead and put on my flame-suit now. Ready, aim, fire!
All these studies are full of crap. People can make a study look however they want nowadays. For Pete's sake, we just saw how Exxon/Mobil got caught for paying millions of dollars to falsify or skew results on how global warming WASN'T happening... There's nothing you can do to say that outsourcing isn't eating US jobs. For all you out there who say that if another country can qualify for the work, then there should be no reason why this shouldn't happen. What you don't realize is that there are still so many companies in the US that are corrupt and are continually posting jobs but not accepting any "qualified" candidates. This is because they want to "prove" there aren't any and outsource to another country. What many of these US companies don't realize is that it's NOT cheaper to outsource all the time. Many of these companies who started doing this back in the dot-bomb years are starting to realize it now. This isn't a smack on other countries or their skill-sets - this is a problem within the US!! Every other country would be saying the same thing if it happened to them!
I have seen countless court cases and articles galore on how extremely qualified IT professionals who applied to jobs that were posted online, or even in newspaper ads, were denied a job only because the company felt they were "unqualified" when in fact they were more than qualified. This only happened because certain companies want to push the claim that there are no longer any qualified IT professionals around in the US.
say what you will - I can find just as many articles arguing the complete opposite.
Cheating is always easier than playing fair, but I'm sure corporations can find good liars for far less than they're paying an average CEO these days.
"Well, since nobody in their right minds can afford individual insurance, a third group is those whose employers don't provide insurance. Guess which group of employers is least likely to offer insurance? SMALL BUSINESSES WITH LESS THAN 40 EMPLOYEES, since they're not required to by law."
I am currently buying individual insurance through Anthem for about $75/mo , slightly more than my full coverage car insurance. A worker's health insurance cost is actually more through the employer because he has to get the same insurance as the others get and the cost of the premium comes out of the wages. Healthier workers get less compensation than they should. The others might get less coverage than they would willingly pay for. (Plus, it's deceiving to potential employees to compare wages from two jobs without putting a value on such expensive benefits.)
"I went for years without a job in the US. I don't see any difference at all there."
I'm not surprised.
"Things mean nothing. Family means everything. If you can't afford to feed your children, what good does a cell phone or cable TV do for you?"
If you're buying cable TV and cell phones your kids probably aren't starving. The free market allows parents to prioritize food over cable TV and cell phones. Socialist government programs do not.
Well, we have one who has been imported from the USA in charge of a major corporation here, and from what you can find out about him in his last incarnation up in Colorado, it looks as though the generation of explanations of this nature is one of his more natural talents, and probably the one he was employed to use.
Will those of you who think that you know what you are doing, get out of the way of those of us who know what we are doi
Ahh, complaints about software outsourcing...
I studied through high school in India and came to the U.S. for college. I remember my CS classes. Our teacher was a dinosaur. He knew about pascal and some basic but he was taught by idiots and consequently his code never got beyond the Hello World level. We were supposed to be learning C++. He did mean well though and freely admitted being ignorant which helped immensely because we were forced to learn by ourselves. I count myself as being very lucky. Several teachers would have shoved what they learned by rote knew down our throats. The quality of software you get back reflects this education, and the price you pay for it. You want good software from India go hire a bunch of IIT and BITS grads and have them do it. You will pay though. Or alternatively, wait a decade or so. Software outsourcing is (paid for!) real world practical training for the next generation of teachers and thats something thats been sorely lacking.
As for the call center jobs... well you could complain about Indians who can't speak English (or American as the case is) but frankly the communication barrier has very little to do with accents or language. I know guys from here that can understand Indian accents easier than they can understand people from central Illinois and Texas. You guys try to imitate Apu frequently enough. Rather, the headache with support people is because they have crappy scripts to read from. Support would suck even if it wasn't outsourced unless you have someone on the other end of the line who actually knows the product he is trying to support. That costs companies money and companies that value their profits more than their customers know they can get away with crap service. Ideally they'd love to not bother with support at all.
Reality must take precedence over public relations, for nature cannot be fooled.
That textile workers were still chained to their factories. Perhaps we should lobby for some sort of "freedom of movement" clause, to allow people to leave an economically depressed area for greener pastures.
Oh, we already have? So what's you're point, then?
do you think it would be fair to say that since 1900 in America over 100 million jobs have been "destroyed"...
In essence, you're making the buggy whip maker analogy. Which works, when the change occurs within a national economy. If Henry Ford had shipped his Model T's in from then low cost Japan rather than building them in Dearborn, the analogy would fall apart.
Manufacturers are engaging in labor cost arbitrage on a scale which employees can't effectively react to, other than via the political process. We're creating a market for populist demagogues. You can pay pundits to label them as protectionist/nativist/racist, but if enough people squirm with radical globalist wiennie up their ass, that tactic ain't gonna play.
Luke, help me take this mask off
From my point of view, outsourcing is a crime. Why? Because the very things that make US (and other post-enlightenment countrys') companies successful are the rights that were fought for by labor unions and voters. Without the basic underpinnings of workers rights and the rule of law the US and other western economies would not have become dominant. The world economy is testament to this in an emprical sense. Now that the companies in question have become dominant world powers, the workers who built them are getting shafted in order to pad out the stock option grants of a few greedy executives. It's a classic prisoner's dilemma but that doesn't absolve the players who are taking part. In my opinon, companies which want to start foreign subsidiaries should be required by US law to provide all of their workers with exactly the same rights that their US (or other western) counterparts enjoy; if this is impossible under whatever foreign government they happen to be offshoring to, then said offshoring should be illegal.
In addition the idea that outsourcing isn't costing US jobs is entirely bogus. Just because existing workers aren't getting fired (yet), doesn't mean that US citizens aren't being denied jobs due to outsourcing.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?"
/sarcasm
If a child is born elsewhere that could have been born in the US, isn't that a miscarriage? abortion? kidnapping?
Ed R.Zahurak
You know, oblivion keeps looking better every day.
But imagine for a moment a business not run by idiots. It does want to save costs, yes. Not because it's out to stiff underintelligent, undereducated, uncompetitive American born-and-bred workers, but because money saved can be put into R&D and (ok, this is a bit sad) marketing. Thereby ensuring that the business has a future and that there will still be a globally competitive technology sector in the States even after all of Asia has ramped up.
So if you're pro-America, have the guts to allow your businesses to hire the best talent, regardless of skin colour and accent.
Goodness knows Microsoft is doing a better job of keeping the rest of the world under its thumb than the Bush administration is....
Real simple choice. Speak Hindi??
Bangalore is the capital of the southern state of Karnataka and the language is Kannada. North Indians generally speak Hindi, but thats not true of South Indians.
Tat Tvam Asi
That's the whole point of society. Please move to any one of several chaotic African nations currently in anarchy and you can hold onto every meager scrap you can obtain in that hell hole. Meanwhile, me and my friends are moving to Canada. They have socialized medicine and it tastes like maple syrup.
Joke's aside, you give up lots of freedoms for the benefit of society so that you can reap your own benefits. e.g. your doctor went to schools funded largely by your tax dollars...
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Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?
If two domestic jobs are created for one outsourced job, isn't that one job gained?
Don't blame me, I didn't vote for either of them!
First of all society != government and for that matter chaos != anarchy.
Second, I've already said that I'll gladly pay for every product and service I use, AND I would happily voluntarily contribute to whatever I think is necessary to help the less fortunate in our society.
I just think it's immoral to remove my choice in such matters. If you can't depend on people voluntarily funding your government then just what kind of mandate or consent is your government operating under? You apparently have so little faith in your fellow man that you support the initiation of force against the people that disagree with you.
"Prefiero morir de pie que vivir siempre arrodillado!"
Who was so despondent after being laid off, she blew her brains out in the parking lot of the Bank of America IT facility in Concord California.
I think well remember that. The programers were offered severence packages ONLY if they would sit and teach their new Indian replacements their jobs. Who were flown here, from India, to learn their new jobs, and then flown back.
Lets see who desperately needs to reduce IT costs...
2006 - 3rd Quarter After Tax Income - Source Google Financials
Ohhh yeah, damn they are gonna go broke! Quick ship those IT jobs off to someplace where we can get shit code for pennies on the dollar that is nothing but slopped together cookie cutter trash based on Microsoft crap frameworks.
Hey KID! Yeah you, get the fuck off my lawn!
The real problem? Software development & other IT people are PROFESSIONALS who have to build and maintain professional skill sets through self-study and/or taking new job opportunities. The cryin' shame is that we aren't smart enough to set up a cartel like the lawyers (bar assc.) and doctors (medical board) do in order to prevent competition from low-quality & low-wage sources as well as establish peer-review for the needed skills and recognition in hiring process.
If you have skills that can't readily be replaced by an untrained foreigner, then you are WASTING the time and money spent on that self-study and new job opportunities. Someone with a valuable skillset with be paid what their skills are worth. If your skills are not demanded by a market which is satisfied with low quality and low wage employees, learn better skills. Don't walk around complaining about how nobody wants to overpay for what you can do anymore, or how the market has moved on and left your antiquated skillset in the dust. The market doesn't owe you anything, if you can't do anything that others find useful enough to pay for, the only person to blame is yourself.
Atanamis
I want to live in a palace on the beach. It isn't economically viable for me to do so, even if I really, really want it. That's life. If you can't support yourself doing what you have in the past, do something else, don't just throw up your hands and give up. Sometimes industries fade away, and sometimes even geographic areas do. It's not necessarily a bad thing.
Certainly, there's a need to help the unemployed become employed, but part of that is advising them that they may need to train in something new, or move to another place.
what most people think is 'necessary' falls far short of what actually is.
And what about corporations which have no moral obligations to aid the needy and in fact have a moral obligation (to their stockholders) to not only _not_ aid the needy, but to create more needy so that their shareholders can benefit from the pool of cheap labor?
And yeah, I don't have a hell of a lot of faith in my fellow man. One quick glance around any part of Darfur, Afghanistan, South America, Mexico, Iraq, Iran, Haiti, New Jersey... doesn't exactly encourage me.
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The article quotes the executive director of the SIIA as saying, '[Offshoring] was used almost entirely as a form of expansion, not as a replacement.'
That's all fine and dandy in an even modestly expanding economy, but what about when the economy hits the bust cycle and contracts, who's going to lose the job, the expensive domestic worker or the cheap foreign one?
Flying is easy, just throw yourself at the ground and miss. -Douglas Adams
There is another way.
Stop doing things that make it impossible to compete. Unions, OSHA, 40hr work weeks are things we as a country have chosen in the belief that they make our lives better. The question has to be asked, "Do they?" If they do, then we need to determine what it is worth to protect them, but if they don't then we need to open up ways to allow US Citizens to work for less, for more hours or in more dangerous situations. Given the option, I would work more hours at higher risk for significantly higher pay. I don't have that option. I have the option to work for less pay, but there are limits. When I need a job to eat, then I don't want to miss the opportunity to take that job because the potential employer can't afford minimum wage. Everybody wants good pay for low risk and safe work, but the fact is that you trade opportunity for those perks. It is a trade and maybe we should re-evaluate whether we really want the terms.
B) Eliminate all the stupid users. This is frowned upon by society.
I agree, I think that there is a big difference between the blue collar and white collar workers.
Lumping them all together in a single statistic is obviously designed to hide some kind of shenanigan that is going on.
Most of the unions are gone, for various reasons. Many of the 40-hour workweeks are such in name only because of unpaid overtime. And yet, corporations keep outsourcing.
There is a fine line between recklessness and courage... -- Paul McCartney
Not much more to say than that. I have trouble seeing how having Asia get richer is bad for the first world. It's called creating wealth, so no it's not a zero sum game. Keep your skills updated and work hard because now you have to compete with that many more people, whether you like it or not. Yes, I'm an American.
As an ousourced employee I can tell you that most of the work that is outsourced to India is not true development work. And this is true with most of the companies.
Companies like Infosys, Cognizant, Wipro, TCS (which constitute about 70% of the outsourcing 'market') are consulting services.
None of these companies write any software. What they do is web services. That's why you see a lot of Java developers from India and very few C/C++ programmers.
And even if companies which actually do write software, like Intergraph or Google only outsource QA.
The REAL development is still done in the US, IMO.
I'm not sure where I implied that I thought that an increase in productivity would result in an aggregate loss of jobs. In the long run, under ideal conditions, it doesn't; historically, we've done pretty well in this regard. So I think we probably agree with each other on this. I'm certainly not advocating Luddism, or any other rejection of increased technology because of the short-run job savings.
The point that I was trying to make is that you can't "compete" with a factory in an area with substantially lower costs (i.e. the Third World) by using technology and making your process more efficient. You can have the most efficient, technologically advanced factory in the world, but it's going to be a temporary advantage. Eventually, someone is going to take the same processes and the same technology, set it up in a low-cost area, and still undercut you. So the "American technology will save us" argument doesn't hold water. (Unless you're planning on having some sort of ridiculous export-control system to prevent foreigners from getting technology, but I think we can all agree that's a stupid and unworkable idea, so let's not say it too loudly around any politicians.)
A net increase in manufacturing efficiency, via new technology or new processes, is a Good Thing in the long run. I'm not debating that. It's just that these increased efficiencies still don't make up for the key problem, which is that it's tough to make a factory in a high-cost area competitive with a factory in a low-cost area. The only advantage the domestic (high cost) factory is going to have, is probably being closer to the end consumers and thus saving on transportation costs...but with high-value, high-technology manufactured goods, the cost of transportation is small enough to still have it work out for the foreign country's favor.
The question that I'm asking -- and I'm not attempting to pose a straw man here, I'm really quite interested and to date have never heard a convincing or reassuring answer -- is that the U.S. seems to have a standard of living which was built on a heavy manufacturing and exports base, as well as a virtual monopoly on the supply of hard currency. Given that we no longer have control of the currency market, and we're a net importer rather than exporter, I don't see how this is sustainable in the long term. I don't think, as a nation, that we really want to sink to the "global mean" after being used to some seriously above-average living for the past half-century, but we seem to be headed there a lot faster than the global mean standard of living is coming up to where we'd be comfortable meeting it.
Anything that puts U.S. firms in direct competition with firms in countries with much lower average standards/costs of living is going to be a losing game for the U.S. There's just no way to win at that. So it looks to me like we're in a bit of a dilemma, and perhaps the only way to win, is not to play.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
Worst case, at some point American production falls so low that no one wants to buy anything from you any more... In that case we all get to experience a run on the dollar, and a global economic realignment. Who knows what the world will look like after that, but it won't look much like what we have now.
This seems to be the crux of it. In my opinion, we're at that first stage ("no one wants to buy anything") already, and we basically arrived there when we started seriously running up the trade deficit. Sure, there are still some big American exports (and probably always will be; we have a lot of exploitable natural resources, after all) but they're dwarfed by imports. The rest of the world is a whole lot less interested in American goods, than Americans are in foreign goods.
What you so politely term a "global economic realignment" is what concerns me. It seems to be the proverbial elephant in the room that nobody in the U.S. government wants to admit exists, much less actually discuss. (Perhaps because they all have their money invested in the stock of well-diversified multinationals?) I rather suspect that said 'realignment' could involve a lot of unsavory stuff on the domestic side (like riots, and expensive buildings being set on fire), when people figure out that their dollar-denominated bank accounts are suddenly worth very little on the international market. To be honest, that sounds a lot like the sort of thing that one would want to have a large pile of gold bullion, canned food, and ammunition stockpiled in the event of. (And just when I thought that Y2K stash would never pan out.)
More to the point, it sounds like something that should be avoided at all costs if it's even remotely possible. The major question then becomes: is it avoidable? Or have we gone too far down the path to possibly turn back now, if indeed we ever could, and this is not simply inevitable.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
The point you're making is quite true; having more people in the global economy increases net production capacity, which results in greater output, which over time increases the standard of living for everyone. Obviously, you couldn't have the standard of living we enjoy now, if you were the only person on earth. This is all true.
Unfortunately it's mostly a red herring in the context of this discussion. In talking about legal vs illegal labor, the question isn't whether some laborers exist or not, but where they are and what market they're competing in. There's a difference between a discussion of the Economy of the world as a whole, and a discussion of a regional economy that exists within the larger world economy, but is decoupled from it in various ways.
So while the presence of a large pool of laborers may be a net good to the Economy as a whole (i.e., if they somehow didn't exist, the world would be poorer and everyone's quality of life would suffer somewhat), this doesn't say anything about whether it's beneficial to have those same individuals in a particular regional economy. California's economy might well be better off without those workers in it. There's a big difference. Discussing whether the regional economy of California, or even the U.S., would benefit from laws that made illegal immigration and employment harder doesn't say anything about whether the existence of those people is ultimately beneficial or harmful to the greater world economy, it's limited only to their location (i.e., "U.S. or Mexico" etc.).
So while everything that you (and the A.C.) were saying may be correct, it doesn't have much direct bearing on the situation.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
First, the relationship between energy and wealth is very complex. Say you consume 2500 kcal in 24 hours. You can spend that energy by sitting on your ass (which creates no wealth), or by improving the Linux kernel (which creates a fair bit of wealth), or by working on a botnet (which would probably decrease the amount of wealth in the economy). In other words, saying that an economic system has X kilojoules in it tells you nothing about the size of the economy.
And second, you forget that humans continuously invent new and more efficient ways to make use of the energy and raw materials on Earth. A useless chunk of rock underground contributes nothing to the economy. But when human science discovers that you can use the rock to make stone axes/town walls/valuable ore/microchips, the rock begins to be worth something, and the amount of wealth in the economy increases. So the size of the economy tends to increase over time, simply because we discover more valuable ways of using the stuff we already have.
Uh. No. I didn't say anything about the foreigner being untrained. How do you know that your doctor is qualified to examine you? Your specialist can perfrom surgery? Your lawyer knows enough court procedure to stand a chance of representing you? A body of their peers stakes the group reputation that they can do so. Now tell me, how many MBAs can recognize an experienced software developer? I'll give you a hint: they think thier 16 year old kid "built" a great web site on myspace.com, so how hard can the stuff you do be. They have no freaking clue and there's no way to identify quality IT work from crap when you don't know what you're doing.
If offshore outsourcing was SOO wonderfull and IT work was SOO simple, all western IT work would have dried up by now. But you know what? It's not wonderfull. It's not simple. It takes exactly what I said above. It's just taken time for the recognition that not all skill sets are equal.
If your skills are not demanded by a market which is satisfied with low quality and low wage employees, learn better skills. Don't walk around complaining about how nobody wants to overpay for what you can do anymore, or how the market has moved on and left your antiquated skillset in the dust.
That has happened slowly. A lot of people who got into IT work have said, "screw this" when jobs got scarce and pay went south. Same thing happend to nursing in the past. But you've used a great word for the crux of the problem "the market". The real problem with "the market" is that the greedy bastard capitalists won't free up the 3rd component - labor. Goods are moving more and more freely, capital moves in the blink of an eye, but our antiquated system of geographical government is preventing labor from doing what it needs to do - move freely. The ONLY reason IT people in India or China or wherever are draining off jobs in the US, Canada and Europe is because they can't freely move here to do the work and we can't move there to do the work.
As far as labor goes, I'll play devils advocate: open the borders - let's have a nice global economic labor balancing. Let people who want to move to western countries with the skills do so. Let people who want to do the same work for pennies on the dollar but live like f*&king kings for thier mastery of western english & cultural skills (asside from having more than 5 years experience and not in 10 differnet companies) go to India or China or wherever. Untill that happens, don't be too full of yourself and your "free market" B.S. - Only when goods, capital, AND labor can move freely will there be a level playing field.
The market doesn't owe you anything, if you can't do anything that others find useful enough to pay for, the only person to blame is yourself.
That's not quite true. The market doesn't exist in a vaccum. It is eeks out an existance like the rest of use depending on the social and political climate of the times. Ask Shell Oil in about 5 years after Venezuela seizes and nationalizes all thier assets in the country if they might reconsider the ROI of having to "owe" a little more to employees than what the executives felt kind enough to scrape off the bottom of their shoes in order to keep massive profits through the roof and shareholders smiling.
No offense, but you sound like the worst kind of capitalist - seems you see no difference between goods and labor. In the real world, "labor" is worth far more than goods or capital since it's the only one of the three that can directly produce the other two. In the case of intellectual work, "labor" can even produce goods and capital out of almost thin air.
*** Sigs are a stupid waste of bandwidth.
I do a lot of consulting work in Silicon Valley, and have for a very long time. I've also seen a lot of offshored projects. In fact, I can't think of a single place that didn't have something over the past 5 years.
The stories of the failures would be funny if it wasn't so sad.
That's a lot of companies. And in all of them, I've never seen it work. Not once. From startups to Corp 100 companies. Forget the BS the guys who are glorifying Offshoring are telling you. I'm sure it's possible to have a good offshoring situation, in theory. In practice, it just doesn't work.
I've also seen managers who claimed it worked. But once you looked closely, they have the exact same problems that you described. Sort of a "Vietnam Victory" rhetoric thing.
Nowadays, I've been seeing failed offshored work come back. Pffft. Screw the manager who was dumb enough to offshore, and who now has his butt in a sling because he failed to deliver. The best I can do in those situations is to break even, and the worst that can happen is that I get a seriously dinged rep because I underestimated how badly the offshore folks screwed up.
So I pass those gigs up. Which is something the managers-in-trouble never expect, thinking that if they pay your high rate, you'll sign up. Sorry, money ain't everything, and I don't need those kinds of headaches.
Companies don't seek lower prices simply for their own sake, they seek lower prices to increase demand for their goods and services.
As has been stated elsewhere, the balancing act is occuring right now as many consumers are rejecting the quality of work at the lower wage in foreign markets. This could be poor English in call centers or error-prone code in software, etc.
The problem is when equally skilled workers are willing to work for drastically different wages. You would have to force companies to hire the more expensive workers, thereby increasing the cost of their goods/services and decreasing their competitiveness. If you tried to compensate by forcing domestic buyers to buy only from domestic producers (localizing the economy) it might work in the short run.
In the long run:
- American workers become less productive because there is less threat of foreign competition for their jobs
- American education no longer needs to be internationally competitive increasing the chance of falling behind the rest of the world
- The rest of the world has a greater trading block (each other) and acheives greater scale and efficiency (through specialization and better use of capital)
In the end, you've dramatically increased the chances of America being uncompetitive on the international stage unless you assume some natural advantage for Americans (genetic?).Come play Moral Decay!
What about jobs which go the other way (coming to the US from, say, India?). This may sound surprising, but it has been happening for decades now. I have a personal story to tell about outsourcing from India to the US which caused the loss of my tech job in India. There were other people like me who were affected, but it all happened very quietly, and everyone (including me) assumed there was nothing wrong with it. Here it is :
:-).
When I left college (in India) with an EECS engineering degree in the early eighties, the computer industry in India was small but competely local. Tariffs and laws prevented the import of computers, and there were about 6-8 companies in India who designed, manufactured and sold computer systems. The way the laws worked, you could import components (chips, capacitors etc.), but not computers, so these companies were protected from imported computers.
I joined one of these companies and spent several years essentially living in heaven. We were doing leading-edge work and in the space of a few years, I designed several CPUs, I/O processors, graphics processors and OS-level code for things like zero-latency disk reads and inter-processor communications. Others at my company built compilers, database management systems and graphics libraries. This was all proprietary stuff, very expensive because of the cost of all the R&D people like me and the low volumes. But I was doing what I loved, doing it well, and having a blast. I didn't get paid much (All I could afford for several years was a bicycle until I managed to save enough money to buy a small motor--scooter), but I didn't care. I worked 16-hour days just to get my name on the next system that we rolled out.
Somewhere in the mid-80s, the Indian government decided that they shouldn't protect these companies, and everyone should be allowed to buy computers from wherever they want. I wasn't worried. I knew the systems I built were better, and I understood Indian customers much better than the American companies whose systems that were starting to come in. I remember looking at the early IBM PCs and some Unix boxes and feeling smug about how much better our systems were.,
You can probably guess the rest of the story. To my utter surprise, my company decided they don't want to have us design their systems any more. Because of their much larger volumes, the US systems cost less, and management calculated they could make more money by getting the basic systems from a US company and focusing on sales, support and custom application development. As a bonus, they got rid of all the wierd techies like me who never quite fitted the corporate culture (they didn't actually fire us, but asked us to move to support/sales, so I quit). The same thing was happening at all the other computer companies, so we didn't find design jobs anywhere else either.
There was no outcry, no political storm, but very quietly and peacefully, my design job had got outsourced to some designers in the US because the final result was cheaper. There's a long story about what happened next, but for the purposes of this post, the important thing was that I figured out there was no point in blaming the government or my management for what happened to me. All that happened was that something removed the protection I was working behind, and naturally my job went to someone who could do it better than I could. What else could happen? Asking for protection again was like trying to retreat into a fantasy cocoon (and nobody was listening, anyway
What surprises me is that so many people in the US today think the current wave of outsourcing is different and try to make this into a moral issue. I can understand the dissapointment of losing a job you love (I've had it happen to me), but I don't see any fundamental difference between what America (and to some extent, Europe and Japan) have been doing in such a dominant way for so long (designing and manufacturing so many of the world's goods), and what is happening in a small way in I
But most likely you are unwilling to change your lifestyle to do so.
And I am not talking about giving up food (which you could, must USians are too fat) or basic amenities, but that you review your consumerist culture of buying stuff for buying's sake.
Gas guzleers, long comutes to work, having 3 or 4 computers at home, wasteful use of energy, cavalier invasions of other countries (you pay them with higer taxes).
All those things add up and make you uncompetitive against people in India, CHina or elsewhere that use public transport, live in closer proximity to their jobs, and can only dream about a $600 PS3.
IANAL but write like a drunk one.
Guys, you are rely tiring.
/.ers refuse to accept opinions of most experts in the field as well as most credible statistics (per capita income is noe of the higest in the world, unemployment in the US is extremely low), well, nobody can do much about somebody that just has decided not to listen to the ovewhelming evidence.
It seems that you "think" with only one half of your brain and avoid at all costs to engage the other.
When jobs are moved to a place where they can be done for a lower wage, the economy of the US benefits.
The resources that US companies no longer have to allocate for wages go towards other purposes beneficial to the US economy (more taxes, rising share prices which benefit pension funds in the US, reinvestment for modernization of the company, etc), also those people employed now elsewhere will demand goods and services. US companies will have now new markets to compete in. The US also benefits by now receiving cheaper services, those people saving money can spend it in other stuff.
All the above generates jobs in the US. It is plain to see for anybody engaging both halfs of his brain, not only the protectionist, isolationist one.
But if US
IANAL but write like a drunk one.
.... every time such idiotic comments show up.
/.ers are worried about, unless most of you sew soccer balls for Adidas or put together sneakers or trainers for Nike).
The countries you are whining about have some of the most pro-worker, pro-union legislation in the world (at least in the areas where more
Your massively uninformed idea that workers have no rights in places like India of China is laughable.
When people are found in those countries in poor conditions it is against the law and the respective union will make a big stink that has political consequences (check for riots in China, you'll be surprised).
In the US you get a pink slip if I understand correctly and very often you don't have time to say goodby to your colleagues. Such practice is considered anathema in many places that are benefitting from outsourcing.
Now go ahead and apply tariffs.
And see how prices of the goods you use everyday begin to climb.
You like inflatonary spirals? As somebody that has lived in a country with 150% inflation rate I can tell you they are a lot of fun, but ultimately devastate your economy (my country spoused the same protectionist ideas for many years, that brought only poverty and destitution, but you are very welcome to find out by your own stubborn, uninformed, self).
IANAL but write like a drunk one.
And you know it.
/. readership sometimes seems to feel they are entilted to work in IT no matter what and irrespective of the economic realities of the day.
There are plenty of well paid jobs out there, but the US
If we were living 100 years or so ago most people here would be decrying the downfall of the jobs of people related to the horse carriage industry and how all those skills were being migrated to Mongolia or the Argentinian Pampas.
IANAL but write like a drunk one.
.... but you don't need to be a programmer to be an effective leader of a software project.
IANAL but write like a drunk one.
By demanding protectionist measures you are hurting the people you intend to protect.
History is littered with examples of people acting in good faith but commiting major blunders.
I could list numerous countries that descended into poverty by supporting misguided protectionist measures. If you want to add the US to that list feel free, the rest of the world can sit down and watch the show.
IANAL but write like a drunk one.
The world's food production is at its highest ever.
You are not only intellectually incompetent but also a poorly informed.
IANAL but write like a drunk one.
There are examples of economies collapsing you can learn from.
The best example is Argentina a few years back. What people did was organize themselves, skip using the wortheless currency at all, and started bartering their goods and services.
They did not run for their guns, their ran for their phones, called their friends and organized friendly bartering markets.
You guys in the US, sometimes are really scary.
IANAL but write like a drunk one.
>>Now go ahead and apply tariffs. And see how prices of the goods you use everyday begin to climb.>You like inflatonary spirals? As somebody that has lived in a country with 150% inflation rate I can tell you they are a lot of fun, but ultimately devastate your economy
That is caused by the government pumping money into the system. That sort of inflation is absolutely not caused by tariffs.
Maybe programmers in Silicon Valley or NYC are getting those kinds of salaries, not in Denver.
Here in Denver, I have seen two ads looking for HTML developers to work for free - just to get experience. I have seen an ad for a PHP/MySQL developer for $6 an hour.
Where I work, they look for experience systems/security people to start at $30K.
Of course there may be some people here getting those kinds of salaries, but those are the exceptions, not the rule.
Dam lies and statistics, There is not job being lost? Well finally, the American universities are pointing to the major drop on computer science students. Currently there are plenty of programmers, give 10 years and they will be gone (I am back in school so I can leave programming). So boys and Girls count me out.
It's true I tell you, feller at work's next door neighbour read it in the paper.
Fortunately for me, that's how I have a job (and a well paying one, at that). The reason they pay me money is not to compensate for my time lost, it's because they expect my ingenuity to improve the company and make them more money.
You are reading a copy of my copyrighted post.
So what you're saying is that if Japan becomes a nicer place to live, that hurts U.S. people? And if Japan becomes as nice a place to live as America, then that's a nightmare for America? Furthermore, you seem to be thinking that once Japan becomes as nice to live as America, then suddenly Japanese will start buying American property because it's just as cheap as theIr own?
Relative Economic strength does affect how good or bad it is to travel abroad, but Japan doing well does not hurt the U.S.
Suppose the quiz were worded like this:
You and your neighbor both get a raise. Which is better for you?
A. You get a 4% raise and your neighbor gets 12%
B. You get a 2% raise and your neighbor gets 1%
Only an idiot (or someone who really hated his neighbor) would choose option B. This is because you are 4% richer instead of 2% richer. Even if the neighbor ends up with a nicer car than yours with A, you're still better off than you are with option B. This is because YOU ARE NOT IN COMPETITION WITH YOUR NEIGHBOR. YOU DON'T 'WIN' BY HAVING MORE MONEY THAN HIM. YOUR INCOME MATTERS TO YOU, HIS INCOME SHOULDN'T.
You are reading a copy of my copyrighted post.
So, the company I work for comes out with a new service which involves OCRing financial docs for our clients, and using the results to reconcile bills going out with checks coming in.
:-)
If you know anything about OCR, you know that no matter how good your process is, you need human eyeballs to verify your recognized documents. And in order to get the turnaround time needed to make this service useful to our customers, these eyeballs needed to be working overnight.
Yes, you can hire a night shift staff to work on this stuff. But people working the graveyard shift tend to want good pay for their services. And we're still a rather small company, we didn't have the resources to grow a days entry staff that could keep up with even one client's needs.
So we now have people in India doing this data entry and verification for us. And the time zones work to our favor: a night shift over here is a day shift over there. And the service has worked so well that our client base has grown big-time. And as we get more clients, we have to hire more local people. Our software dev department is growing, pay rates are rising, and we're getting the resources to work with better technologies. As a developer, I'm not complaining.
So, yeah. I'm in favor of overseas outsourcing, especially when it leads to growth of better jobs over here.
Good judgment comes from experience.
Experience comes from bad judgment.
You moron, pay attention to the god damn conversation. Don't hop in the middle of something you aren't paying attention to attempt to "enlighten" us on something we aren't even talking about. Jesus Christ, you're about just as bad as the Grandparent poster and those idiots who labeled his post insightful.
What happens if you get into a car accident and become totally disabled? Unable to work, and needing assistance with daily activities?
How long will your emergency fund last?
How does it feel when you are careening down the highway at 65 mph? What would happen to your earning power if you went from 65 to 0 in 0.1 seconds? What would happen to your family?
They don't grade fathers, but if your daughter's a stripper, you fucked up. --Chris Rock
In this century, we have created many global dependencies which cannot be easily undone. Globalism is not an ideology, it's a reality.
US Dollar is the de facto reserve currency for the world. Industrial productions depends on raw materials and energy gathered across all contininents. In order word, it is not possible to plan for healthy development of the US economy independently of the economies of the rest of the world.
We HAVE experienced trade wars of the past where many countries pursued the 'beggar thy neighbor' types of policies. It was disasteours and probably contributed to multiple armed conflicts.
I'm not proposing for any country to become purely alturistic, but simply to look to lift the living standards of all people from all countries at the same time. Look how the develpment of China is stimulating the entire global economy.
I'm sure corporations can find good liars for far less than they're paying an average CEO these days.
Try looking in India. Oh yes, I have 23 years experience in java 4.7!
This is getting OT, but if you want an abject example of why people start going for their gun closet every time things start to go unhinged, you don't need to look much further than New Orleans just after Katrina. The second you took away the police presence and most of the civil infrastructure, the place went to hell in a handbasket; next thing you know, we were hearing about reports of, in addition to the usual looting and arson, roving "rape gangs" wandering the streets.
This doesn't surprise me in the slightest. American culture is dichotomous; on the surface, we have a basically orderly society, one with a respect for other individuals, and the use of non-violent means of conflict resolution (taking each other to court, typically). However, there is a dark, latent underbelly to our society; one where violence is praised, 'rough justice' is celebrated, and you're entitled to whatever you can take, by hook or by crook, from anyone else. (Take a look at popular culture through the past century if you want examples.) Most of the time, the social structures of civil society keep a lid on the darker aspects, releasing them only when it's appropriate. But when those checks disappear -- when the infrastructure that normally acts as a disincentive to people's baser impulses falls apart -- things go downhill, quickly. Any major city in the U.S. is only about 24 hours away from looking like a deleted scene from Mad Max, if you take away the police and other control channels.
As I've never lived for any significant time in anywhere but the U.S., I can't make any comparisons to other cultures. It may be entirely possible that in other places, all the police could take a holiday and nobody would notice. (And in rural parts of America, this is probably the case.) However, I can absolutely assure you that would not be the case in urban or suburban regions where I've lived.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
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Your statement is only correct with regard to things for which there is a potentially unlimited supply.
/. you're already one of the winners.
Amazingly enough, almost everything is in potentially unlimited supply. For instance, the more people that have enough to afford a Wii, the more Wiis are made. Everyone (especially Nintendo) wins. The only things in limited supply are unique items (like the Mona Lisa), and things artificially restricted (like 'limited edition' cars). If you wanted an excellent look-alike, thoguh, you could get it for a fraction of what the Mona Lisa awould cost. Even things like 'living space' can be manufactured (we can build up with skyscrapers, or down with bigger basements). The more wealth other people have the easier it is to get things from them. For instance, without the wealthiness of Japan, we wouldn't be able to purchase a Wii in he first place.
For most goods- cars, beef, Wiis- there is a finite supply today, but if there is enough demand for the goods, the supply will be greater tomorrow. Farmers will raise more cattle, Nissan will build more cars, Nintendo will build more Wiis.
If you've had some history, you might remember back when "A chicken in every pot and a car in every garage (Hoover, 1928)" was a campaign slogan. Now, do you know anyone who can't afford to eat chicken and whose family doesn't have a car? Unless you work in a homeless shelter, probably not. Back then, though, most people didn't have those things. How do you assume that Economics is Zero-Sum when Americans today have so much more than they did then? I'm sure people back then said brilliant things like "Only 30,000 cars were made this year- there will never be enough made for everyone to have access to one" or "There will never be enough chickens for everyone". As it happens, those people were wrong.
If you just print up a bunch of money and hand it out to people, your logic makes sense- the price of goods rises when the money supply is artifically enhanced. What you are missing, though, is that WORK CREATES WEALTH. If I turn $50 of hardwood into a $200 table, and I sell the table to a customer for $150, both the customer and I have gained value- I have $100 more than when I started, and my customer has a table that is worth $200 (at least to her). That's what Capitalism is all about. This also means that if the rest of the world is doing well, they can make more transactions with us that benefit both of us. A sustinance farmer can't offer me anything of value, while a manufacturer, a programmer, or a mechanized farmer can.
Bottom line: You have the economic comprehension of a five-year old. You are more concered with eliminating competition to your 'front row concert seats' than increasing the number of concerts worth going to. You want to keep 90% of the world poor and uneducated so there is no competition to your job, not realizing that the more educated people we have the more luxuries we can build (and the better we can build them). Mostly, you don't realize that you aren't in competition with everyone else. Life is a game everyone can win. If you have the time and money to post this much on
You are reading a copy of my copyrighted post.
I think you're missing a key point.
There are a limited number of US programmers.
If you don't outsource and you don't import programmers (ie. H-1B) then two things happen:
1. You bid up salaries
2. A lot of programming won't get done
Second point is key. A lot of IT that people were willing to spend money on won't happen because your inventory of available programmer hours will be smaller.
If you believe that IT is valuable to our economy (and I do) then that will have a knock on effect damaging our economy and American companies throughout.
For example, consider Oracle vs. SAP. Obviously Oracle's going to have to pay more for programmers if they don't outsource or use H1-Bs. That means they will do less programming - marginal projects won't happen - and their costs will be higher so their prices will probably also be higher.
SAP, on the other hand, is a German company. Unless your plan includes tarriffs on imports of foreign software they won't be affected. Even if you do that, what about the rest of the world market? Europe, Asia, Latin America, etc?
So SAP gets a big boost against Oracle in the ERP and Financials space.
So now what happens to all those American jobs that you were trying to protect at Oracle when Oracle gives up and shuts down their ERP business?
Ooopsie?
Hong Kong and China and the garment industry are a great example of this.
Back in the 1970s and 1980s garment factories in HK started lobbying to import PRC workers to cut costs. The government refused to save jobs. So HK garment factories started moving to China.
The government said "That's OK - they keep their office work in HK so we're keeping the good jobs. And the factory jobs would have gone to PRC workers anyway if we had let them import PRC workers."
Then the HK companies started moving their office work to China, but importing HK staff to do most of it. The HK government said "That's OK - it's still jobs for HK people."
Then the HK companies started hiring and training more and more PRC office staff. And the HK government shut up. Today when I visit my garment factories in China I see one HK guy running a department with 20 - 50 white collar PRC workers.
I don't know if HK could have stopped this process by letting HK companies import PRC workers, but they sure as heck could have slowed it down.
The HMOs that are pushing offshore medical care cover travel costs, housing (sometimes including a hotel room for a family member), all incidentals (ie. meals, taxi, etc.) Why shouldn't they? It's still cheaper than sending someone to a US hospital. If you don't want to leave the country to get important surgery no problem - just pay more for your health insurance. Personally, I'll happily take a plan that lets me do the tourist thing on their dime if I get sick, especially if it saves me money!
Stop using logic!!!! This conversation is about $!#$@!#$ fat cat bosses with MBAs conspiring with smelly foreigners using unfair labor practices and unfair trade to steal our jobs! Please focus on what's important, not logical facts and arguments! GET WITH THE PROGRAM!
The NY Times recently had an article pointing out that hedge funds are paying CEOs of their portfolio companies sums that are as high as or even higher than what public companies pay. Since the principals of hedge funds are compensated almost totally as a proportion of the profits made by their funds and since CEO salaries obviously directly impact that (if a CEO is taking $100MM out of a company's bank account each year then the company is worth $100MM less each year because it has less cash) that means those CEO salaries directly impact the compensation of the people running a hedge fund - every dollar they pay a CEO may mean $.20 to $.40 out of their own pockets (the remainder comes from their investors). This means that hedge fund principals have tremendous incentives not to overpay CEOs. They are still paying them hundres of millions per year. Based on this, you have to decide that the people running hedge funds are stupid, or that they are Good Samaritans who feel the pain of executives who make under 9 figures, or that top flight CEOs actually make that much difference to a company's bottom line.
"Well, if a job is created elsewhere that could have been created in the US, isn't that a job lost?" Doesn't matter how you feel about outsourcing, a job created in the US but done elsewhere isn't a job lost. There was never anything there to lose. If money is created that could be given to you, but goes to someone else, that isn't money lost.
People aren't owning their homes now, they are getting longer and longer term mortgages, as I pointed out, they own larger debts. Before the globalism push 30 year to 50 year to interest only mortgages were mostly unheard of., you just didn't see it. And inflation? You believe the official numbers when they removed the *critical* M3 stats last year? Why would you believe that? Why would they do that other than to help hide the fact the printing presses are roaring? Independent analysts have done their best to come up with some real numbers and they are findng it is (roughly)twice as high as the government claims. Here, check it out. And the jobs? Huh? They reclassified burger flipping as manufacturing, and stuff like that. They count the loss of a 20$ an hour job with full complete and robust bennies manufacturing with a swap in to walmart at 7$ with toy bennies as "still a job".
I don't. It's a job maybe, but not the same. that's cooking the books to make it look the same or better when it isn't.
I take the long view, because I've been around. I just don't fall for three card monte stuff.
Sorry, it's still hooie. I am not tryng to flame or be mean but it's hooie. They are cooking the books and calling debt wealth, when it is not. Globalism as they are practicing it, not academic theory as it is somehow taught but as it is on the ground, is serving mostly to increase the bottom line of the top 1% while they push credit on everyone else, give it to them, and try to convince them more credit=produced wealth. Sorry, that is the magic beans for the cow scam. It really is. Credit created out of thin air with the central bankers and printing press money and fractional reserve is not the same as produced wealth, nor will it ever have the same impact as using actual work that leads to produced wealth then being traded.
Sorry, it's a scam for the rubes. As for other nations in a similar situation per debt and trade imbalances? Yes,hell yes, they are in potential future deep doo doo as well unless they stop the huge manufacturing shift.
You can NOT printing press your way to "wealth". You have to work for it by producing true tangible wealth. You can't just reshuffle around what is already produced and call it "more". You can dump the same 5 gallons of water back and forth with many buckets, and I don't care how many buckets you wind up using (analogy is with paper financial "products" here), you'll still only have 5 gallons. You can reclassify how much is in a gallon, you still won't have any more.
And if you still want to argue,you need to argue against some powerful folks who know what is what. I could point you to a Fed governor who said the same thing just a few months ago, or perhaps the GAO office, and other top economists, they saw the credit exposure globally is pretty risky right now. And if you recall, it wasn't too many weeks ago the US sent a huge economic delegation to china basically begging them to do something with the yuan, and the chinese told them to *get stuffed* because they are calling the shots now because they *produce wealth*, they don't just talk about it and manage it and bring up powerpoint slides, they manufacture it. They also said they have "enough dollars now".
"Enough". Let that sink in a scosh.
Wealth is grown, mined, or manufactured from the previous two. That's it. Everything else is paperwork shuffling or wealth rearranging and servicing. Servicing wealth does not produce more wealth, that's a variation on the broken windows economy. Extending more layers of credit paper on top of already produced wealth does not increase the pool of wealth, it just makes more credit and dilutes the produced wealth. Printing up more money using numbers picked out of thin air doesn't make your money more valuable, it makes it less valuable. Yes, you can "free trade" in it,and trade is a wonderful
I m belgian and working in Belgium. I run a company in the UK, Belgium and Cambodia. I m just starting the companies in UK and KH but what is clearly huge is how much you pay for renting (Directly and indirectly).
If I m looking to hire a assistant for administrative purpose In PP(KH) it will cost me around 100$(Full time) if I want to have somebody in Brussels it will cost me around 2000$(part time). And i will have something similar in amount of work done because of the difference between part-time and full time compensate for the difficulty of cultural difference and time shifting.
Does the belgian guy have a better life than the cambodian? No way because he pays more taxes and really a big big amount in renting. A little appartment in Brussels 600$ and then every time you pay a service or a product you pay the renting of the sales guy or the service guy.
I would like to know how much of the salary of a person goes to renting. I see more and more people spending like 40-50% of their salary(netto) for the rent so a number around 60-80% of the cost of living is caused by renting (directly or indirectly). Do you know if there is some way to know the real number?
"Use cases are fairy tales..." I. S. 2005
After taking the advice of a fellow /.er (Read up threads a week or two after they haver been posted to actually get decent/honest comments), I must say he was totally right.
Let me start with a disclaimer: I mostly agree with the people who want to make sure their young and the next generation have a decent shot at the kind of life they have enjoyed.
But when it comes to the attitude - "As long as things work in our favor, its all justified. If it seems like to go other way, its irrational/unpatriotic/treason/immoral/etc." - things get distorted. Its all nice and dandy for you to keep such an attitude but don't try to justify it for everyone else. Don't you think that when things are not going your way, they are going some other person's way ? Why shouldn't they think the same way about your objections "Fuck them. We seem to be getting the better end of the deal. We will deal with the thing if/when it comes to bite us back" ? How do you think countries like India felt when their industries were destroyed because of mass produced goods from developed countries which (even though of inferior quality in some areas like textiles) were immensely cheaper to produce and drove the manually-powered industries to close. There were so many immensely talented workers in industries like handicraft, textile etc. who actually starved to death (as opposed to the metaphorical starvation people like to throw in arguments against offshoring) Back then these countries were told to deal with it and learn how the capitalist gods operate. Now tables seem to be turned in some areas so people from the other side are bitching about it. They seem to forget that the bitter lessons of those days have taught countries like India to move forward and not to try to protect each and everything from "outsiders" in vain. It has been a good lesson and it has helped them to try to become a better nation.
Seems like old lessons are lost along with wisdom when a generation dies. The irony is still interesting to observe.
Politicians and Pedophiles: Two groups of exploitive bastards who are most dangerous when they're thinking of children.
I'm trying to explain something obvious to you. Ask yourself "Is the average person today richer than they were 50 years ago".
If you think the answer is yes, ask yourself how that is possible without the creation of wealth, since clearly there are more people today than there were 50 years ago, so how could they all be richer?.
If you think the answer is no, then ask yourself if you would rather be an average american in the 1950s or an average American today. If an American today has a higher standard of living than they did 50 years ago, aren't they richer?
You're confusing short-term, small-scale economics with long-term, large-scale economics. It's possible for the entire world to have a standard of living much higher than America does now- but it can't happen tomorrow. For 2000+ years every person who predicted that we were about to run out of food/resources/space/wealth has been proven wrong by history. Quality of life (and the creation of wealth) have been rising for thousands of years, and if you can't see the trend and predict that it will continue It's pointless talking to you.
You are reading a copy of my copyrighted post.
The origin of the discussion was regarding offshoring and the effect on American jobs. Via some middlemen you eventually made a claim that you could increase labor rates (wages) for orange pickers without having a "significant" effect on market prices for oranges and thus making the jobs more attractive to American workers.
My post (which probably should have responded directly to the above, not your last retort) challenged your assumptions on two grounds:
- That given the choice, companies would do as you suggest in a market economy
- That if compelled to do so by government action, market forces would render the benefits moot over the long term.
Best of luck to you in protectionist la-la-land.Come play Moral Decay!