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Posted 24 Feb 2004 at 05:17 UTC by gilbou  |
It's coming and fast. Good in short-term ? Probably. Good in long term ? Not sure.
Been reading articles about it, and it's not only about the US seeing jobs go to India or elsewhere. Sending a job from a modern country in Europe or the US to India or Pacific Area divides the wages up by ten. Of course, outsourcing is nothing new. In the past decades, we all saw low-paid jobs go to smaller countries where it could be done. At that time, economists said it would be ok : the creation and conception "white collar" jobs would remain at home, while production is done abroad. So far, so good. But now, we see "white collar" jobs going abroad: programmers paid 1/10 of your salary, medics in India checking your X-ray scans sent from US hospitals.. So we the high-skilled jobs go abroad, adding to the manufacture-kind low-paid jobs, what is left ?
Something else to think about. Companies answer to the previous question that there will be senior jobs like system architects or people that take care of software design from the top. Sure. But you only get to those jobs with experience, after going through entry-levels jobs who are now outsourced. So you go to college, study and then you get out. You're not a senior and there are no jobs left to become one. Where is the path to that secure and skilled job if the path is nowhere there ?
I feel like in the long-term, pays are gonna go down. I'm not against it as long we're able to cope with life, rent a house and pay for our food. But usually, we just see salaries go up slowly or be stagnant while life costs raise (i'm thinking about a friend. He has been working away from Paris for over ten years in building houses. He came to live in Paris and the first job he was contacted for he was proposed the same amount of money he got.. outside Paris where it's ten times cheaper to pay for a rent. For the same price in Paris you get 1/10 of the surface for the same price, and that's not talking of other costs. Insane huh ?)
I'm not a programmer, rather a sysadmin that takes care of locally installed machines so I feel a bit more safe since there's need for those machine locally ("locally" as in-country) but I've got so many highly-skilled programmer friends I feel they're worried. Because if their jobs go abroad, there's not enough "senior alike" jobs for everyone and how to become senior then without those entry-level jobs ? And if in the end this drags everyone's wages to outsourced countries levels, how are we gonna pay much higher prices for everyday life goods and will manufacturers cope with this ?
How dare you question the virtues of laissez-faire capitalism?;-)
there is no country that has a real capitalism going around. because people can vote, the political class has created laws to protect, help (with funds) parts of their economy. it is true for europe and it's agriculture and the us too with its steel (and recent turndown of their protective law on steel by the way). i'm not saying that real capitalism is bad, i just don't know. but capitalism without state intervention does not exist so the hypothetical "laissez faire" is long-dead since 24th october 1929 (if you studied economy, you know what Maynard Keynes did and how interventionism saved the liberal's economy principles up to now).
I think a lot of chinese and indian people consider themselves rather modern.
and they are. their education is as good or even better as the one you will find in europe or us universities. nothing wrong with that. i am not against outsourcing as a capitalistic concept. it did happen for low-skill jobs and it will continue for higher-skill jobs. the question is : either the wages go up for everyone and it settles in the long term (probably not) or they go down and settle in a near-level (much more probable). problem is life cost per country. you are paid much less in india but in the country, it equates as a quite good salary and you live well with it. but in so-called "modern" countries (i would rather use the word "older in capitalism history" to be precise) once the prices and cost life goes up it rarely goes down (almost never in fact except for crisis situations). the outsourcing in the long-term is gonna put a light-spot on the huge differences in cost of life per country which i find interesting. why does buying food and clothes and a roof over your head costs so much in Paris compared to Delhi ? when wages go down and slowly equilibrate, what will happen to those highly prices ? if they can go down, why does justify their high-level except what people get from their jobs and spent. where is the line between the real cost and sale price and the inflated one which is done because of higher wages. outsourcing is a logical move for capitalism but all economists in so-called modern countries explained for years that older-countries in capitalism would outsource manufacturing and keep "knowledge jobs" inside their country is like a balloon that just exploded. this worries people of course, but the point is those economists have nothing to say now rather than "it will be good in the long term" while i feel it is going to be good only in the short term and get worse in the long-term, not for economical reasons but because people (especially the ones that vote) will use their political vote as retalation on politics because they fear for they jobs going away. it looks like a "moral" question but there are no morals in capitalist economies (which the US and most so-called modern countries are not unless for opportunistics moves, since the US debt and actions are deeply Keynes-based).
You think you're worried about outsourcing? Indians are worried about their programmer jobs being outsourced to Malaysia.
If we use some common sense, it looks like people in North America will just have to become more highly skilled. There are several competitive advantages that we have: we're closer to managerial centres, and we speak English natively. So develop skills that can't be outsourced because the time-zone differences would make the latency too high.
So develop skills that can't be outsourced because the time-zone differences would make the latency too high.Examples?
i would not say i'm really worried. if jobs get outsourced somewhere and really that's those i want i will follow the jobs probably. but it's easier when you're young than older, even if i believe in mobility at any age. there is always good things to learn from other countries and people all around the world, humility first especially. but since i'm a gun owner and user i have to select countries i want to get into so this gets into the equation (and troubles me because i'd like to move to london where there's a weapon-ban over the whole country if i'm right). off topic ;)
The way I see it, outsourcing will make wages fall in the US, but it won't be all so bad. It becomes cheaper to produce things and therefore lower wages should go farther than otherwise.Longer term, it'll probably hurt the US by weakening the dollar in international markets, prices will rise to purchase things from foreign countries and become unaffordable, then jobs will come back to the US and it will be one giant cycle measured in scores of decades to come back around to what we have been more familiar with over the last 30 years.
Unions are the worst thing for the US right now, IMO. Since wages have to fall, unions attempting to keep jobs and increase pay will only make the wage declines hurt more.
1) Do everything, including project management. This means you need to be able to communicate well. The people who hire technology companies may not care if company X outsources to India, but they do care if they don't get to talk to the project manager face-to-face. If you can work all ends, you can't be outsourced, because you're too close.2) Do something locally-based. Work on projects that are specific to your local area (having to do with local laws or something). You, being a resident, have inside information not available to people in India. Also, as a resident, you have easier access to the information as well.
Basically, the only jobs you can outsource are the "black box"-y jobs where they hand you a specification and you come back with a program. However, if you add more to the equation - design input, working with customers, being a consultant - all of a sudden your direct presence is valuable.
On a side note, there are instances where outsourcing can create more profits for the _workers_ here at home. For example, a friend of mine does photo retouching. He charges something like $35/photo. However, he found out that there were places in India (maybe it was South America, can't remember for sure) that charged $0.50/photo for retouching. Therefore, on many of the easier projects, he simply collects his fee and passes it off to the outsourcer. He, the worker, is making more money, AND someone else is being employed in India.
johnnyb: The last point seems to explain while costs of living are still at ridiculous levels, even when production costs decrease. Bosses -- whether they are self-employed workers or corporate types -- save money, but they don't pass any of the savings to consumers.
That makes sense, an eliminated cost doesn't translate to a lower selling price. What it translates to is higher income which can probably be converted to hiring more hands, buying additional equipments or more working space.Bosses -- whether they are self-employed workers or corporate types -- save money, but they don't pass any of the savings to consumers.
nymia: One of the biggest, fastest growing companies in the world is translating those savings to consumers. They're big enough that they can tell their suppliers that they want to business on a long term contract. They're so big and powerful that the suppliers will go to China, India, Malaysia, and cheap labor countries to make the products at the low prices that this company wants. The company is such a staple in the US economy that suppliers crawl, scrape, and fight over getting their products into their stores.It's Walmart and I dislike them more each day. ::start rant:: Take a walk down some shelves and pick a few things up. "Made in China" all over the place. People joke about all the Chinese crap in their house all the time and then turn around and complain about Bush screwing up the US economy. It's not Bush's fault. It's the millions of tiny purchases that consumers make each day adding up to huge cost savings for companies and the companies that don't move to China, Malaysia fall in the shadows. Then it's started a trend for every other company to do it. Then dumb ideas come from Democrats preaching to unions that he wants to make companies give huge notices before firing people and make all kinds of noise about it. That's not good for the companies when for 3 months or whatever they have to keep paying and letting disgrunted workers who have 3 months notice that their being fired to not work and steal stuff from the companies, the very things that drive the economy.
It drives me nuts all the money we send to China for all the trashy, cheap plastic, worthless junk they send over here that we just suck up (speaking as the US in general), especially during Christmas all the people that don't know what to buy their relatives that buy some cheap trash from China only so they can watch their friends and relatives rip open the wrapping paper and pretend that's what they really always wanted for their big Christmas gift when they know that 1,000,000 people bought the same, identical Chinese trash from their local Walmart. Real unique. ::end rant::
Oh yeah, and vote Bush 2004.
deekayen: Perhaps you prefer Wal-Mart to sell "Made in China" products and charge exorbitant prices?
Walmart seems to be turning into a Bad Mojo. Below are just a few of the websites I stumbled into about the negative impacts of having Walmart in any neighborhood.
Tying the idea of outsourcing with Walmart's business practice, it is possible to see what they are trying to do: compete globally. For example:
(1) Approximately half of Wal-Mart's employees
are eligible for food stamps.
(2) The median income of a Wal-Mart employee is
about $12,000 as opposed to the national
median income of $25-30,000.
Wages are aligned to global levels, Walmart style.
Heck, take Jacksonville, TX for example (small population). They used to have 4 major chain grocery stores in city limits. Walmart built a supercenter and all the local groceries went out of business, then all the smaller stores that were in the same shopping centers as the groceries went out of business. Then the businesses around the shopping centers started hurting. It was a nasty cascade effect as more and more people went to Walmart because local business owners couldn't afford to keep investing back into their businesses to keep them nice.People sit and whine and look for someone to blame. For lots of people it's natural to blame George W. Bush, but he's worked with Alan Greenspan, congress and given taxes back to people and poured government money into the economy. Anyone who's studied the history of economics knows the US economy thrives in correlation to the US deficit. The higher the debt, the more money that's floating around in the economy for investment in companies.
So speaking of investing, legilation isn't the best thing managing a free market economy. It can buffer drastic changes, but government can't run the economy without communism, communism has been proven to not work, and therefore people that blame Bush for economic troubles are ignorant.
One of the most important things boards of directors look at in corporations is stock price. The real way to voice your opinions about outsourcing is to buy stock of companies that produce in the US and then buy their products. When or if they decide to outsource or move stuff overseas, dump the stock. If enough people actually did that, it would be all over AP News the next day, "Stockholders responded negatively when the XXX Company announced its intentions to move xxx jobs overseas."
deekayen:Under your system of free trade, Wal-Mart is perfectly free to build supercentres anywhere, and perfectly free to sell cheap stuff; consumers are perfectly free to buy from Wal-Mart; and small businesses are perfectly free to find something else to do. So what are you complaining about, dude?
Free trade means no protection for small businesses. Protection for small businesses means no free trade. It's that simple.
Unfortunately, when some people hear nice-sounding terms like "free trade" or "capitalism" or "tax cuts" or "thriving economy", their minds get all so clouded that they don't realize the full ramifications of this "freedom", and they don't question whether the tax cuts will benefit only the rich, or whether the mythical `state of the economy' correlates with how easily the average citizen can earn a living.
tk: Sure, Walmart can build as many stores as they want, but that doesn't mean I'm going to shop there, buy their stock, or speak kindly of them. What I'm annoyed with are the people that blame the US government for the what they think is a crappy economy when millions of them swear by shopping only at places like Walmart who sells some of the largest volumes of foreign, cheaply made, trash. I've strayed from what gilbou started with. Companies wouldn't move employment and production overseas if nobody would buy their stuff after they did it. I'm complaining about the ignorance, indifference, and blindness of the purchasing decisions that contribute to the problem in the first place.
When people barely earn enough to get by, you expect them to buy expensive, locally-made trash, and not cheap, foreign trash?You may as well say, "well, he did murder her, but it's not his fault, because it's her indifference to self-defence techniques that caused her to be murdered."
I say, if basic things like housing, electricity, etc. are cheaper in the first place, small businesses may actually have a chance of competing against Walmart. (But I guess it's some inalienable, self-evident principle that electricity charges must forever rise.)
Actually, Walmart is not entirely about free trade. One of the ways they can pay so low is by hiring a large number of illegal immigrants. They were recently busted on this practice, and apparently people high-up in the chain knew about it.One of the problems a lot of people assign to free markets, but really isn't the fault of the free market, is that large, impersonal supercenters come in and destroy small towns.
You see, with a free market, it's like a giant democracy. There is often a misunderstanding that in a free market, the person with the best product at the best price wins. This is not the case, necessarily. In a free market, the supplier whom the customer values the highest wins. You see, the problem with our country is not the free market, it's the values of the citizens. As individuals, we have enslaved ourselves to the dollar, and are unable to look past someone offering a lower price than someone else.
If Walmart came to a town, and the citizens decided that it valued the small-town style more than it valued low prices, Walmart would soon be out of business. However, because the citizens of this country are selfish and materialistic, our society reflects this.
Again, this is not a problem with free markets or capitalism. Free markets are simply the most efficient way of having the economy match the values of the consumers. The problem is our values. They suck. Until we change our own values, we will continue to have these problems.
Of course, today, judgments based on morals and values are usually considered bigoted, so don't expect to be popular.
In other words, free trade can never be at fault. If things go awry, it's always the fault of the people. Adams Smith must be infallible; how can it be otherwise?
Posted from dedasys.com/padovachronicles :It *is* possible to vote with your feet, and people have done it:
Padova, a city of 300,000 some odd people had two chain hamburger "restaurants": a McDonalds and a Burger King. A few months ago, the Burger King closed.The McDonalds is right next to the train station, and stays in business because of its location (Ray Kroc, McDonalds founder always said his business was 'real estate'). It attracts travellers from the train station, and the immigrants that congregate in the area.
The Burger King was in an area accessible to university students, and in a busy area of town, and it even had a drive-in, a novelty for many of my friends in Padova (although I don't think anyone actually used it).
I think the fact that not even two fast-food hamburger joints can survive in a medium-sized university town is wonderfully illustrative of "voting with your feet". If you don't buy their food, they will close up shop, something that people in Italy, where eating well is of paramount importance, don't have any problems with.
On the other side of the Alps, despite the well publicized, and at times violent demonstrations in France against the "golden arches", the protestors' compatriots continue to gobble down burgers at a rate, according to The Economist, second only to Britain within Europe.
I think this attitude towards good food is one of the "little things" I enjoy about life here. Instead of suing them because of one's obesity or trashing McDonalds with a tractor, people here simply do not eat the bad food they offer, and therefore, they don't do business.
The free market is happy, the people are happy and eat well. McDonalds isn't, but if they want to compete here, they will have to invent better ways of doing it.
"In other words, free trade can never be at fault."Yes, quite correct. When you have freedom, and there are problems, the only potential source of the problem is the people. When you take away freedom, then you have shifted the source of the problem from the people to whoever has power.
It's pretty simple - whoever has the power is the one at fault for the problems they cause. When you have freedom, it's the people who have the power. When you don't have freedom, it's someone else.
The only argument I could think of that would put free trade _itself_ at fault was if you could show that a group of free people could not even possibly do the right thing. If they can do the right thing, and do not do it, it is their fault. If they cannot, then yes, there is a problem with the system. However, I don't think there is a situation in which a group of free people absolutely cannot do the right thing.
That's a copout. To repeat: "well, he did murder her, but it's not his fault, because it's her indifference to self-defence techniques that caused her to be murdered." If she was free to act in self-defence, but didn't, does it not mean that she has to take some responsibility for her own death?No, I hear you say. The fault belongs entirely to the murderer. Even if the victim didn't learn self-defence, she didn't deserve death. And you'll be right...
...except that you'd have contradicted yourself. Even if consumers don't torture themselves by buying expensive local trash instead of cheap foreign trash, they don't deserve a rotten economy.
In any case, how do you decide what's the "right" and "moral" to do in each case. The friend of yours who does photo retouching, after saving money by outsourcing, did he use the money to help the poor and needy? More likely he just kept the money in his own wallet. And you call that moral?
tk, I really didn't get the point you were trying to make. Please explain further.
tk: I don't understand where you're going with your examples either, especially that murder one. To apply the murdering to Walmart, I guess the closest I could see murdering apply to Walmart is victims "demanding" murderers. The women would be Walmart and the murderers would be consumers. One woman went out to find someone to kill her, equivilent to the first Walmart looking for it's first city to conquer. When the first city was conquered (the first woman murdered), more women wanted to get murdered and more murders appeared from the cracks. The murderers are wrong for killing, but the women want to be murdered, so can you really blame anyone?I can have a friend that retouches photos, that also outsources. I don't have to use my friend for retouching photos though, neither do I have to like his business with outsourcing, but he can still be my friend.
I think the conclusion doesn't follow with the premise, because attaching a value to given property implies an exchange system wherein exchange values are set and defined.Again, this is not a problem with free markets or capitalism. Free markets are simply the most efficient way of having the economy match the values of the consumers. The problem is our values. They suck. Until we change our own values, we will continue to have these problems.
The statement The problem is our values is the mechanism by which an object receive an exchange value. From my point of view, the premise should also be consistent with the conclusion by making Free Markets dependent on how exchange values are handled. Working backwards, the whole scheme of Free Markets may become irrational depending on how exchange values are set.
Free Market economy works best at rational levels, my take is that low labor rates are just too good to pass-up. The irrational part being the inequality of labor rates between economies cause wild fluctuations to labor markets.
Hmm, not sure if I wrote it clearly, though.
deekayen: You can disagree with a friend, but johnnyb actually advised others to follow his friend's example, which must mean that he thinks his friend acted morally. Thus, johnnyb believes in the Bible, yet thinks it's moral to keep your savings to yourself, instead of using those savings to help people. Clearly, his ideas of right and wrong are self-contradictory.OK, enough with right and wrong. Perhaps I'll use a different analogy that's easier to grok: Suppose you have a coding task, and you ask me what's the best programming language to use for it. I say, "Machine code."
"Why?" you ask.
So I answer, "A coder can do anything with machine code; if there's any problem, the problem can only lie with the coder, not machine code."
What's wrong with this answer? Here's what's wrong: the answer's a totally irresponsible one. Instead of thinking about how best to satisfy the task requirements, I've merely passed the responsibility to someone else.
And some people, whenever there's an economic problem, the solution they suggest is always "free trade". When "free trade" doesn't work, it's because people have the wrong "morals"... except (as I said above) the "free trade" proponents themselves aren't even clear about their own morals. They're being totally irresponsible. They don't know the true solution, so they just throw the problem to everyone else.
The reason this discussion is making no progress is that some of the terms used are fetishes for some participants. "Free trade", to tk, implies a specific set of legal and economic policies, with identifiable consequences. To some others, it acts solely in the role of a noise used to identify group membership, and divorced from any practical implications or consequences.Wal-mart are both a bunch of lowballing scumbags, and also exemplars of as pure a capitalism as is seen today. There's no contradiction. While it may be immoral for any particular manager to participate in various forms of viciousness, the corporate charter demands it. Indeed, almost any corporation that is in a position to follow their lead, but doesn't, is strictly in violation of the law, and subject to shareholder lawsuits. A manager who refuses to do what is reprehensible, but strictly legal (or cheaply forgiven), is acting against the interests of shareholders. That's what corporate capitalism is about, public-image manipulation notwithstanding.
Of course Wal-mart is uniquely positioned to play nastier than any smaller corporation. They can even force suppliers to make their other customers subsidize Wal-mart. That's an example of monopoly power at work, and an example of a fundamental failing of pure "free trade" that has led to the need for regulation: truly free trade always tends to monopoly abuses by the biggest participants, just as anarchy decays directly to dictatorship. That we see abuse as an anomaly is a result of vigorous (past) enforcement of anti-trust law. A healthy market, in which most participants are free to act, is a fragile construction. In fact, it is a very recent invention, more recent than (e.g.) clocks. The notion that markets arise and maintain themselves naturally is, at best, naíve, but is strictly dishonest when promoted by corporate officers, who are in a position to know better.
"You can disagree with a friend, but johnnyb actually advised others to follow his friend's example, which must mean that he thinks his friend acted morally."I did no such thing. I simply mentioned it as a counterexample to the idea that outsourcing means fewer local jobs. I actually have not decided whether it is moral or not. Clearly your views do not allow for any commerce, because "pocketing the difference" is explicitly what profit is, even if you decide to give it away to charity.
In my own company, Bartlett Publishing, in the check I will be receiving, I am giving 10% to my Church, 15% to my son's school (littlelighthouse.org) (this is a 1-time thing because my revenues were far ahead of expectation), holding 25% for possible taxes, keeping 10% for my family, and re-investing the rest in the business.
I don't think the "coding" analogy really says anything at all. A better analogy using a computer would be if someone were to ask me "is using a computer good or bad?" and I answered "using a computer has nothing to do with good or bad. It is simply a very efficient means for good and bad people to accomplish their good or bad acts"
'When "free trade" doesn't work, it's because people have the wrong "morals"... except (as I said above) the "free trade" proponents themselves aren't even clear about their own morals.'
Talk about blind presuppositioning. I'm glad to know you know me so well.
"They're being totally irresponsible. They don't know the true solution, so they just throw the problem to everyone else."
Have you considered the possibility that perhaps they are taking the problems on themselves, instead of forcing the problem on everyone else? Those who want to have restrictive trade laws are FORCING other people to solve problems that THEY see as valuable. Those who want free trade do not force their own values on others. I think that there is misinformation that people who have money are predisposed to be using it for ill purposes. That is simply not the case. My grandad, for instance, started with nothing, and became a multi-millionaire. He gave so much money to OSU that they named a building after him. Now, you're probably thinking that he used most of his money to build a big house and such. Simply not the case. If you were to guess his income by his house, you would probably guess he makes under $50,000, especially since many of his kids had to share rooms growing up. The only thing that might indicate he had money was that he had a swimming pool and a decent car that was less than 10 years old. He believed in free markets, and he especially believed in helping others out. He, however, let his values guide him and what he did with his money while he let other's values guide them and what they did with their money.
As far as the Bible goes, Christianity is all about GIVING, not TAKING. When the government interferes, it's taking. When people do it voluntarily, it's giving. Free markets allow people to give if they are good, or not give if they are bad. As I said, it allows society's values to be reflected in the most efficient way. If people are good and have good values, they will not shop at stores where people are exploited, and will give their money to good causes. If people are bad and have bad values, they will spend their money on their own pleasures no matter who has to suffer. Both modes of operation are supported by free markets.
johnnyb: But now I'm not asking in the abstract whether free trade is "good" or "bad". Now we have a specific economic situation at hand, and I ask, "what's the best thing to do in this situation?" And you say, "Free trade." And, "Morals." This is an irresponsible answer.If giving is good, and taking is bad, then what do you say of those people who give their money to Walmart? "They're bad, because they're giving money to a bad organization." But you just said all giving is good; there's nothing there distinguishing between giving to good people, and giving to bad people. So what's this "morality" you're talking about again?
Suppose it's bad to give to people who are bad. Then when you donate to your Church, how do you know that the Church won't use the money for nefarious things? And how do you know the Church won't donate your money to someone who donates the money to someone who donates the money to someone who does evil deeds? Is it still good?
And if you can't even make up your mind on whether your friend acted morally, then what hope is there for the rest of us? Do we all have to go through a long, agonizing process of ethical calculation before we buy that product, and by the time we finish our calculations, the situation would've changed and we have to redo our calculations all over again?
People who propose restrictive trade laws aren't being irresponsible. True, these laws are likely to be implemented by other people -- but by suggesting specific measures, the proponents are expressing their willingness to take the blame, when these measures do fail. If I suggest using PHP in a real-time graphics engine, and it doesn't work, I get the blame, not the poor PHP coder.
Finally, ncm pointed out that the big corporations are often required by law to behave as scumbags. I wonder what this legal restriction is doing here, in a set of laws that supposedly promotes freedom? Is "free trade" not "free" after all?
The outsourcing is speeding up the creation and progress of a middle class inb the countries where the outsourced jobs go. Such a new larger and wealthier market will create wealth for the rest of the world.At the short time there is benefits and drawbacks. The benefits is cheaper goods, which will mean those consumers have more money free for other things, which will create more jobs. The drawbacks obviously being those people whose jobs are outsourced, and who will have less money to spend, which again will cost more jobs.
In the case of Wal-mart, the notion of morality with respect to labor practice show Wal-mart providing employment which, in essence, considered a good act. Wal-mart employs and pays wages that are considered </i>bona fide</i>, although a section of the population see it as below their standard of living, also think this practice in sin gratia</b>, though it is not. Wal-mart is simply posting a job requirement with a wage equal to the task of the work considered fair and honest.
I'm not defending Wal-mart, what I'm trying state is simply show that there are several ways to view the situation. This one shows the view that haven't been taken so far.
while the discussion is interesting, i would have expected it to be more closely related to the subject, on the macro-economic scale and median/long term issues :)
the french newspaper le monde noticed that this issue is now one for the us government which opposes use of federal funds if outsourcing is used:
http://www.lemonde.fr/web/article/0,1-0@2-3210,36-355552,0.html
The trend is still upward, about 3.3M jobs will leave by 2015.See chart scanned from Time.
nymia: Anyone can play number games. I bet I can find you a dozen stocks on NYSE that given the past 3 or 6 months of performace, a trend chart could be drawn to make you a millionaire by 2015 with a meager investment.
deekayen: So if the number of jobs leaving isn't a good indicator of economic performance, then what is a good indicator? Your butt?
...perhaps 3.3M is an exaggeration, but the current figure is still quite large, no?And trends aside, if your job gets outsourced, what are you going to do? Will you just stop buying things at Walmart?
deekayen, you definitely have a point, I too am not confident of the source but that is what is out there and probably the one to be considered a fact. There are several issues at play which is quite complex for me to comprehend, below are some unrelated items gathered that might bring some light.
Jeremy Rifkin, the author of 'The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era wrote an article wrote:Another article written by a humanist from Utah stated:Economists have long argued that productivity allows firms to produce more goods and services at cheaper costs. Cheaper goods and services, in turn, stimulate demand. The increase in demand leads to more production and services and greater productivity, which, in turn, increases demand even more, in a never-ending cycle. So even if technological innovations throw some people out of work in the short term, the spike in demand for the cheaper products and services will assure additional hiring down the line to meet expanded production runs.
The problem is that this theory appears to be no longer applicable. The US steel industry is typical of the transition taking place. In the past 20 years, steel production rose from 75m tonnes to 102m tonnes. In the same period, from 1982 to 2002, the number of steelworkers in the US declined from 289,000 to 74,000. "Even if manufacturing holds on to its share of GDP," says University of Michigan economist Donald Grimes, "we are likely to continue to lose jobs because of productivity growth." He laments that there is little we can do about it. "It's like fighting a huge headwind."It seems that corporations have reached the limit of efficiency which has the potential of eliminating humanity in the equation. Could this be the tipping point where corporations be held accountable for their actions against humanity? I don't know.Globalization of capitalism will be the major influence on the peoples of the world during the next 100 years. Balancing science, technology, and capitalism to evolve a sustainable society, concluded Dickman, is the challenge of the future.
tk: There is no infallible indicator, but there are a few proven indicators that have been shown to have a reasonable statistical correlation to the economy. I don't see "jobs leaving the mainland" on the list.Even if 3.3M people did loose their jobs, I very much doubt they're all going to sit at home and collect welfare for the rest of their lives. They'll re-train and do something else. Go on monster.com and search for "nurse". People flood to where the high pay is and the jobs are open. You can't outsource many services like nursing, and in most cities, there is a need for them.
Economic bubbles usually mean companies spent years building a base of non-essential employees to prepare for the future expected improvements in the economy. The tech bubble popped so outsourcing is one of the side-effects. It is very likely that people flocked to tech jobs that normally otherwise would have become a nurse. Here's another tough one for some people to grasp. If those tech people should have been nurses in the first place, maybe their tech job never should have been based in the US in the first place and it was destined for India from the start. Call it the logic of destiny.
the point of nymia is interesting. perhaps it is false, exagerated or plain wrong as tk suggests, but think about politics and people. politics have economic advisors and they will be feed with this information, and the people (of the united states but also other countries) are discussing this trend. right now a bill is prepared to avoid federal funds helping companies in the us that outsource part of their jobs (idea being that us funds should not be allowed or used to pay jobs abroad). i wonder how kerry and bush are gonna handle this matter. this trend is real and will not be avoided. outsourcing will move those jobs outside as the low-wages ones to improve production costs. what i wonder is how economists are going to react to it. they explained that manual jobs would be outsourced, while intellectual or so-called "knowledge" jobs would remain in the country. but now, they can be moved outside so what is the part and kind of jobs of the "knowledge" class that we're going to see going abroad ? programmers are a target since people abroad have good universities, knowledge and lower wages. and with the help of internet, the machines and data storage can even be moved outside so sysadmins like me can even kiss their job goodbye :)
in the long term, those whose jobs get outsourced will either get another job or move abroad (the main ratio will change its job probably). can we imagine what jobs will be left. in france we have people thiking about the whole thing. here, those who work contribute to pay everyone's else (including those whom don't work) medical care, funds for older's people and funds to give money to people that don't work so they can look actively for a job (that money being used for food and transportation means while they look for a job). some economists here are saying that productivity and outsourcing are pushing jobs outside our country, while those that keep jobs are better paid and "pay better and more" for those whom don't find jobs anymore so they say it's ok. those whom work will get under more tax pressure to handle the situation. weird thinking ;)
they kind of explain "no problem if people lose jobs, those who don't are better paid and will pay more for all others that don't work anymore" (i find this crazy in fact). we are dying under taxes here, over 40 % of our pib being used (eaten rather) by the government bureaucrats...
very often i feel like we're in some kind of old-russia, working half our lives to pay for bureaucrats who are nothing but a remnant of the kings era, people living their lives over the work of others and very unproductive. i can't even believe that we got communists in our country : yuck !!
a slashdot article referenced a psychologists report that described companies, if they were actual people, as "sociopathic". i.e. totally devoid of any social skills, social awareness, social responsibility, in fact socially anything.we cannot guess what the outcome will be, but neal stephenson's "snowcrash" is a pretty good description of this scenario taken to its extreme:
microwave ovens for $1.50, shipped in on factories that float round the world, in governments selling off assets to admiral bob and general jim, roads to corporations for them to toll, and entire states, and/or parts of, to the highest bidder. mafias becoming legal just like any other company, because laws simply don't exist any more.
in neal stephenson's book, america is left with only three things that it does best. 1) music / video for the entertainment industry 2) software (microcode) 3) fast-food pizza.
the book isn't even _about_ the above, it's just... taken as given that that's the way the world is, and just gets on with telling a stonking good story.
america is imploding under the weight of its own amoral code. my advice - to anyone who cares - is don't worry about it. live your life with integrity, make a difference if you can, but don't get yourself killed (or sidelined to where you _cannot_ make a difference) by making stupid or amoral decisions.
Some jobs are inherently hard to outsource. Prostitution for example.Keep in mind that "outsourcing" is something that the tech industry recently invited as a term from something that has been happening for a long time. It used to be called "trade" and certainly has been around longer than money - possibly as long as the worlds oldest profession.
Will trade result in more programers in Thailand and less prostitutes? Probably. Will it have the opposite effect in the US? Perhaps. Is this good for Thailand? Who knows. Is this good for the US? Who knows.
Is this good for the world as a whole. I'd vote yes.
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