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Tech Sector Expansion Blunting U.S. Job Outsourcing
xzvf writes "BusinessWeek summarizes a new report from the American Electronics Association (now known as AeA) that they think mitigates the effect of outsourcing on IT employment. US demand for tech workers is through the roof, the highest it has been since the boom of the late 90s. The tech sector added some 150,000 new jobs 2006, and there are no signs that interest will flag in the near future. 'There is so much global demand for employees proficient in programming languages, engineering, and other skills demanding higher level technology knowledge that outsourcing can't meet all U.S. needs. "There would have been a lot more than 147,000 jobs created here, but our companies are having difficulty finding Americans with the background," says William Archey, president and chief executive of the AeA. One culprit is the dearth of U.S. engineering and computer science college graduates. Second, immigration caps have made it difficult for highly skilled foreign-born employees to obtain work visas. Congress has been debating whether to increase the numbers of foreign skilled workers allowed into the country under the H-1B visa program.' "
how skilled is the average US programmer versus the average outsourced programmer? it seems it would be harder to communicate effectively to the outsourced person due to locality and language barriers, and would therefore possibly create some interesting roadblocks to development of a project.
AeA was founded to lobby the US Government for contracts for HP and HP suppliers.
Today they lobby the US government for increased H1-B quotas to keep employment costs down, in addition to lobbying for contracts. It is in the best interests of tech companies to have an increased supply of qualified labor. Great -- although there will be a lag, if pay and prestige increase for these high-demand positions, more students will enter comp sci and engineering programs. Instead, AeA is asking the US government to subsidize their industry by increasing the labor supply.
I'm not saying there wasn't job growth in tech sectors the past couple years. What I am saying is that AeA has an agenda to push, and it's not one necessarily aligned with tech workers.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
Let me be the first one (I think) to say that this is just another conspiracy to import more programmers to depress domestic programmmers' wages.
Any guest worker system is indistinguishable from indentured servitude.
There's your problem. Most employers don't want to hire entry-level engineers. They figure they're just training you for your next job. It really sucks searching Monster and finding hundreds of 3-5 years-of-experience listings and zero entry-level listings.
The good news is that once you land your first gig, within a couple years you'll be sitting pretty. I haven't updated my resume in about a year and I get interview requests on a weekly basis. If you live in a good market, those same companies that stiffed you in the past will be all over you like stink on a monkey.
You harvest what you sow.
When you sow the message that the path to gleaming limos and the high life is through thug culture and pimping out your women, and not through intellectual pursuits or even good old-fashioned productivity and invention, then that's the kind of youngsters you breed. And the effect on the nation's future in advanced technology is then 100% predictable.
Cool high tech doesn't appear by magic out of nowhere. You have to be highly educated (or at least self-taught and highly motivated) to work at the advancing edge of technology, and that requires a large amount of skill and deep interest in the topic. The message delivered by the telly is that those things are extremely uncool, unhip, and frankly "really dull, man".
But it's a free country, right? So people can broadcast whatever they want, even messages that are contrary to our self-interest?
Sure. But eventually you lose that precious freedom if you forget that real wealth (not just money) comes from progress and invention, because you'll end up in servitude to those nations that understand that you have to safeguard your future freedoms too, not just your current-day ones. And that means making education and technology and being intelligent cool in the public eye.
There is a solution, and it's compatible with our current concepts of daily freedom. We need special interest group and lobbying corporations and a whole raft of think tanks to be giving the message of "tech and education is damn cool, and very profitable" to media, business, politicians, the to blessed public too, alongside the output of MTV and the RIAA delivering the message of self-destruction.
It *is* possible. But it will require some effort on our part.
"The question of whether machines can think is no more interesting than [] whether submarines can swim" - Dijkstra
I was helping my neighbor, who is in the trades, with his advertising fliers on MS Word - when I showed him the Ctl-Z combo, he loved it and thought is was the most awesome feature in Word. Anyway, I also helped him with his books...
Me: grossed $87,000 working 60+ hours a week.
Him: $150,000+ averaging 40hrs/week. Occasional weekends. But if he worked a weekend, it meant that he was OFF during the week.
I felt really smart when I showed him the "Ctrl-Z" , then like the stupidest fuck in the World when I saw how much more he was making than me.
Most of us burned int he dot com fiasco gave up. Myself and probably at least 20 friends all lost our jobs while some exec got rich with his golden parachute. We've all since moved on to other things, some, like myself, went back to school and switched careers. Others went blue collar so they could spend time with family. The truth of the matter is the industry is corrupt as hell. I still remember my companies President walking around the office bragging how he was going to sell the company, fire us all, and retire in Tahiti. I had multiple CEO's in a matter of 6 months, each one trying to pimp the company off to the highest bidder. They never wanted to build anything, make anything, or provide any security. It was, and still is, about a quick buck.
I am a highly skilled IT person. I used to make a lot of money but have settled for less than a third of what I used to make simply to avoid being on call, working 18 hours a day and putting up with management that doesn't manage anything other than their own checkbooks. I would rather have a life, some self respect and dignity. Fuck IT. I'll never ever do that professionally again.
I wrote this essay on my personal blog here but will duplicate it in this thread: Most of the complaints about offshoring service jobs center around the lower quality of service received. When a customer and a customer support representative have a language or accent barrier, the experience is already swinging into the negative. While this is a valid concern, there are more backlashes to offshoring than thick accents. I'm going to tell a story of a young man with no experience and no degree. Through basic computer knowledge and motivation alone, he started out as a level 1 tech support representative for a big modem company. This was a placement through a contract job and when a bigger networking company bought the modem company, the contract ended. (Later, the whole Skokie, Illinois building was sold and support was moved.) From there, he got several other fortunate contract placements that built his resume and experience significantly. From Level 1 tech support, he grew up through higher technical positions, then low to middle management positions, and mid-level to high-level engineering roles. Over a decade later, he's doing well for himself as a systems engineer for a very stable internet services company. While the lack of formal training and education have held him back a couple times, employers found his on-the-job skills and real-world experience to be very valuable. He's also a blogger. In fact, he's writing this post. I am sure I am not the only example of someone whose success is wholly attributed to "climbing the ranks." A decade later, there are more computers, gadgets, and connectivity systems than ever and it would be a great breeding ground the next generation of engineers... Except for one thing: There's no ground level. Entry-level CSR positions are now overseas, so anyone attempting to get into this industry must go into debt for a college degree. Four years and $80,000 later, they have to hope they can land one of the few remaining positions in the tech industry without any real-world experience. From there, it's a long, hard road to the higher positions. And what of the higher positions? What happens when the engineers do not have the experience and history of "face time" with end users? Do the designers know what the people want? Is there some fundamental disconnect that happens when engineers and developers are so far removed from customers? If you ever dealt with Windows Vista's security center, you may know. If corporations continue to destroy the ground floor of the technology base, we will have no more American engineers. Please, tech companies, bring the technical support and entry-level jobs back to America. It shows loyalty to your consumer base, dedication to quality service, and most importantly, a logical path for career growth for the next generation of geeks.
You know, i've actually had little brothers and sisters of friends come and ask me about a career in computing. And i've been extremely honest in telling them that unless they have an extremely high resistance to bullshit and doing crap jobs for a few years post graduation "so they build experience" to forget about it, and do something more constructive for society than work for the computing industry.
I'll give you a hot tip : because most of the "new" jobs are mostly trenchy and/or computer service over the phone type jobs. And while a lot of people win their lives with this stuff ( and i'm not knocking down the people working the trench, they should have their pay doubled, no questions asked ) it all comes down to quality of life. And stories of IT people going to work at K-Mart are too ingrained in our culture to make the prospect of that kind of employment a good strategy in the long term, UNLESS YOU REALLY DIG THE STUFF.
An electrician actually contributes more to society, is well paid and has a respected profession that will be in demand for most of his professional life. I'm not sure i can say the same for most of the IT profession.
Peace and happyness to you, by LullySing
It's very true. Outsourcing causes far more trouble than it is worth. I've had to work with outsourced developers, and there are three huge problems that you almost universally run into with them. 1. English: They can speak it to a degree, but it is often difficult to understand accents during phone conversations, they don't understand American expressions (and don't know what you are trying to say), and they often aren't very good at understanding chunks of universal English either (you ask them a question, they don't understand the question). 2. Time zones / disasters: I had a lot of problems with outsourced Indian developers in this area. They are awake when you are asleep, and vice versa. You need them to make a change to code they are delivering, you send them an email, they make the change, and you get the code back. Sounds pretty normal until you consider that with outsourcing the process takes 24 hours, because they don't get the email to after your day ends, they make the change, and you don't get the response until the next morning when you come in. Worse, if combined with #1 and #3, they didn't understand your request, didn't deliver what was required, and you have to try again and wait another 24 hours. I had that happen with a guy who seemed to just make changes to his code at random, hoping that it would give me what I wanted. Day after day I would get new versions from him that wouldn't do what I asked. Another issue relating to distance is the fact that they can have a bunch of natural disasters that you don't experience. Our developer in Mumbai got flooded out of the office for two weeks due to monsoons, and so the project just stalled because we were all waiting on a piece from him and couldn't get it. 3. Subpar skills: This is a huge problem with foreign developers. There aren't enough quality/accredited universities, so there are lots of subpar, poor universities springing up to try to meet demand (and giving developers the same degrees as the good universities), so you have to be able to somehow keep up with which university is which in order to decide if a developer is likely to have the skills you need. Also, the educational systems in general in a lot of these countries just aren't that great. You hear a lot about the US system being terrible, but it does turn out quality workers who can THINK CREATIVELY. A lot of these foreign systems focus on nothing but memorization and rote repetition. Looks great on the standardized math tests, but when it comes to problem solving or writing creative, optimized code many foreign developers simply can't. They haven't ever learned to do anything other than what is already in a book, and therefore can't do a lot of unique things to extend the state of the art. That's not to say all foreign educations fall into that category, but a good deal of them do. Really, when it comes to getting what you pay for, hiring an American engineer from one of the top tier engineering schools is the way to go. And if you have to hire someone with questionable skills due to a lack of resources/applicants, you are still better off hiring a questionable American, because at least you won't have the turnaround and disaster delays discussed in problem 2. Really the only time I think outsourcing is a good idea is if you are a multinational corp and you want to make programs in another nation for the market in that nation, OR you want to provide really late night tech support, because it is hard to find techs that will want to work tech support at 4 AM (whereas Indians would normally be awake at that time).
Beware of bugs in the above code; I have only proved it correct, not tried it.
When information is power, privacy is freedom.
Sadly, this is true.
A lot of companies offshore do have employees with fake resumes. I know people from several "top" offshoring companies with resumes that look good but are full of crap. In a lot of countries (including India), your ability is gauged to be proportional to the length of your resume - you will find people with 4-5 page resumes and it gets ridiculous. If you have several years of experience and/or are a PhD with a godawful number of publications, two or three pages. Else, just give me a page long resume and nothing more. Of course, I am in R&D and usually people are sometimes asked to submit their CVs, which can be as long as they like.
Secondly, these companies (HCL, TCS, Wipro, Infosys) hire engineers from all over the place. For instance, I know people who studied material sciences or marine engineering working as IT contractors or consultants. How much sense does it make? Of course, the reason they are hired is because you assume that having an engineering degree is representative of some level of analytical/quantitative skills. Which, of course, isn't always true because their hiring is a function of their academic performance. Once again, it boils down to the fact that academic performance != skill, which becomes especially true in an goal/achievement-oriented culture like India.
On top of this, a lot of companies are known to add people to more than one project at a time. So, while you are technically a part of the project, you do not really do much. At the end of the day, your resume mentions several projects over a frame of just a few years, but you haven't really deserve putting them there.
Add all this and you have the average resume from one of these companies looking way better than the average US kid. Any surprise then, that these kids aren't getting hired?
(I'm not saying that all of this is true for everybody; obviously there are exceptions and some are better/worse than others, but there is definitely a significant percentage of people for whom this is true.)
I am but one data point, and though I started at a very low salary in '02 out of school, I have climbed about 17k per year since then, changing jobs twice. I can assure you the financial industry is willing to pay for quality people. Considering that finance is known to the best paying out here, you would still be surprised at how poor some of the candidates we get are. There is a shortage of SKILLED programmers out there.
If you are your own business then of course you can make more than someone that's an employee. That's simple, basic economics. It's like comparing yourself to a 1099 contractor who's encorporated himself. It's not so much that the tradesman is a tradesman as he is an independent businessman.
If this tradesman is an employee and making 150K then it probably just is a made up story.
Part of being your own boss is avoiding the surcharge on labor that your boss charges for your time to the final customer. Cut out the middleman and you can keep that surcharge for yourself.
Pretty simple really.
A Pirate and a Puritan look the same on a balance sheet.
Oh really. My father was a house painter, I worked at it on holidays for years. Try scraping rusty iron grill work down in 100 degree heat for a week. Try crawling on your knees for another few days sanding down skirting boards. Try lifting 20 foot scaffolds and walking along planks two storeys above the ground while using a power sander. Yeah spending a day in an Aeron chair playing with your nerf gun in between coding is much harder. And if you mean "brainless", well my father served a seven-year apprenticeship. Any idiot can slap on a coat of paint. The test is what it looks like six months later. That work was too damn hard for me to spend my life at. So I took the soft option of earning a Computer Science degree.
I started at Ernst and Young in 1997 as a "consultant". Back then, there were 5 levels: Partner, senior manager, manager, sr. consultant, and consultant.
My salary - directly out of college - was $48,500 + bonus.
And that was back in 1997. Since then, I got out of IT because it "wasn't going anyware". Sure, I had PLENTY of mid-level job opportunities but for me, I could see the writing on the wall. And the writing said: this is a lousy career because nobody will pay you what you are REALLY worth.
In almost every other type of career I can think of, the workers "share" in the success of a company. It may be delayed, but it eventually trickles down into better pay and better bonuses (and options if you are lucky). IT is the only area where I never saw that happen. I saw lots of capital expenditure budgets go up, but I never saw the actual workers making more money. That pretty much sums up why I still *love* technology and computers but I can not imagine how anyone "gets ahead" in this career. Unless you are an owner of one of these companies......and I am not.
This is how this happens:
100 mid-high level executives take aim at the corporage dart board. 50 of them miss, 50 hit. The 50 that miss, more on to other "opportunities." The 50 that hit get promoted.
Someone at company X, that needs a CEO, notices one of those 50 and says, "Hey, lets get them, they hit it big there!!!" Company X makes an offer to hire the executive, but the exec, not being too dumb, won't leave a good thing without guarantees, says "Ok, but I want A, B, and C and you have to give me M million dollars if you let me go early." Company X says, "No good exec would leave their current gig without a guarantee, so OK." Once the new exec is in place, not only do they not have their former support staff that may have been the reason for their success, but now they have the corporate equivelent of tenure and can try any goofy idea they want without fear that they will loose their shirt like if you or I if we lost our jobs.
Sometime it takes several iterations of step 1 before you can become CEO, but it's a good job when you can get it.
There are CEOs that worked their way up the ranks of the company they work for. We rarely hear their names associated with big corporate collapse do we? (Usually the insiders are too static for the board, so they go with a outsider to shake things up.)
All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
Hmm, that's interesting. I only mentioned WF because I skimmed a magazine article about executive pay and that was one example they gave of a company that was doing well and didn't pay their CEO over $1m (around $600k IIRC).
That magazine may have been a little old. According to Google Finance, WFMI had excellent performance until January 2006.
I live on the planet that where I did that.
I co-oped between every semester of school while I was at school. Granted it took me 4 and a half years to finish school. But I had a job waiting for me when I graduated, and ~5 years out of school I'm making 100k. In addition if I wanted to leave my company I could get another 20k or more easily (I've been offered that by 3 companies without even looking).
I could have probably done fewer internships and come out the same way, but I needed the money to help pay for school. And I figured it was better to do IT related stuff than work at the local McDonalds or tend bar.
It also let me realize that I did not like doing Computer Setup, App installations and troubleshooting. And I didn't like doing Network Admin stuff. I really don't like laying network wire. Web design, and business applications were decent. I really liked doing DB stuff. I prefer working for a small consulting firm, rather than a large company. I now do ETL work. Based just on class work I would have never gone into DB or ETL work.
And 2 years of internships, does not equal 2 years of full time work. Usually you do those between class semesters, so maybe a full year of working. If you do it all 4 to 5 years you're in school, it'll equal 2 years of full time work.
But it is enough to get an "entry" level position. If you want something with out the requirements, look for junior or associate positions. Those are the true, "I'm just out of school with no experience" positions.
And how is this any different than teaching, getting a business masters and doing an internship, trade skills where you work under some one else, law, nurses, doctors, or many other jobs? I know my older brother did the same thing in the mining/oil industry while in school. And most of my other engineering friends did the same.
Internships also are not hard to find. Yes, it's hard to get an internship at MS or other large prestigeous company like that, but when I was in school there were plenty of smaller companies at job fairs looking for interns. More spots than we had CS/CE students. IT has it even easier, because non-IT companies still need IT people, and have IT departments. I interned for Ford, a Health Care software maker, a small computer consulting firm, a home mortgage company, and a CAD consulting company. Only 1 of those companies was programming/IT thier main business.
If your school can't find you an intership during your summer months, either you need to find a better school, or more likely you need to try harder, go to job fairs, do some work on your own to find companies that offer internships, rather than spend the summer on your parents couch during the day, and getting drunk with your friends in the evening or playing WoW.
You might be surprised. I've heard about some law work (contract reviews, etc.) going to India. Ditto low-level doctoring (reading X-rays). Do a little Googling. Maybe law is primed for the same trouble IT has: All the entry-level stuff goes offshore, then after 5 years companies are shocked, shocked to find nobody local has only 5 years' experience, they start lobbying for guest workers, collapse.
That's the part that makes this different than buggy whips: To what industry am I to move, even assuming I am infinitely intelligent and flexible, so I can learn to do anything well?
I can't see any way that any job which does not have a strong requirement for physical presence (law does not) can keep any instances onshore. I also don't see any reason for manufacturing to have any presence onshore (how much is there today?) I have trouble seeing how a country can run an economy entirely on services, maybe you can help clarify that. (I've heard "foreign investment"; what foreign investor would invest in a 100%-services economy?)
It's obvious that frictionless free trade would bring the entire world's standard of living to the same level (eventually, once an equilibrium is reached). Figure out the population-weighted average standard of living of the world. It's probably close to that of some of the poorer African nations. Let's assume that economic efficiencies freed up by frictionless free trade quadruple this standard of living. We're likely to still be at a level less than the poorest slums in the current U.S.
Now we're at the real heart of the problem. The U.S. has such a higher standard of living than the rest of the world that the difference is unsustainable. As the world gets better-connected, the U.S. loses its comparative advantage, exerting a downward pressure. I personally think that surrent trends will lead to SOL's all squashed down to the absolute bottom (equivalent to the very poorest people in the world today), with a very small amount of super-rich. Your economic theories may vary, though.
It might be a good and moral thing that we in the U.S. get whacked down to a SOL commensurate with the rest of the world, or even that 99% of the world lives in squalor while 1% live in luxury. I still have trouble liking it though. Call me selfish.