Offshore Outsourcing Anger Will Ebb In 2004
from the calm-down,-people dept
Gartner is now saying that all this anger we’re hearing about tech companies outsourcing the labor overseas will die down next year as the global economy starts to improve, and people realize that the sky really isn’t falling. Every time the country goes through things like this, people begin to freak out, and only later do they realize that it’s not the end of the world. People and companies adjust, and change to meet the new market realities – and, generally speaking, things end up for the better.
Comments on “Offshore Outsourcing Anger Will Ebb In 2004”
If it lasts
I can think of a lot of things that can go wrong with the frail prosperity of outsourcing recipients. Pakistani agents, Sikh separatists could send a truck bomb or two into Oracle India’s office, and there go the investors. Amnesty International could put up video images of starving children performing data entry work, and there go the investors. Activists could show images of deformed babies born in third world nations who were the victims of toxic computer products being dumped there, and suddenly computers acquire $500 “environmental impact fees” everywhere. SARS, multi-drug-resistant AIDS, or some other new disease could decide to surface in India, and there go the investors. The slog of boring IT work could lead to drug epidemics among programmers, making the U.S. street price of drugs prohibitively high, therefore dramatically reducing our crime rate, while giving new jobs to our drug dealers exporting the stuff. Our cigarette companies could make a killing from 2 billion new lungs wealthy enough to smoke. As poorer nations get richer, they are grappling with double-digit increases in obesity; we have decades more experience in that area. What if one of our drug companies invents an Anorexia Pill?
sure...
sure, of course its not the end of the world…and it won’t crash the economy as we know it, the country will forge on…
Its easy enough to say when its not YOUR job that’s outsourced.
Outsourcing --> Unions
The biggest stupid in all this is that now, for the first time, software engineers are starting to think about unions. Long term, I think that’s bad for the industry, but I can’t blame them.
Corporations need to think about the long-term effects of their actions. Yeah, it may help them save a bit more money today, but what is it going to do to them (and everyone else) tomorrow?!
No Subject Given
America seems to be outsourcing quite a few of its jobs. First it was trinkets, then shoes … now code (sorry, Neal, but Snow Crash wasn’t quite on the money there). It’s like we’re exporting money and labor overseas. I wonder what it is we’ll eventually be doing for jobs.
Corporations have an amazingly short-term, “we won’t get caught,” not us mentality. Time and again they are busted (and pay measly fines) for environmental abuse, bad business practices, etc. Globalization is just another this-quarter-shortcut that can improve the bottom line, for them, RIGHT NOW.
It certainly benefits the corporations, as well as the people in the sweatshops overseas, but not here. The usual argument, that the lower labor costs will “trickle down” to the consumer, is bunk – corporations just say, “Ooh, more profit margin!” and keep their prices the same. It’s great for the handful of American citizens who are CEOs.
Same old story
Didn’t we go through the same doomsday scenarios when computers were being introduced in the workplaces and the employees were concerned that they will be replaced by computers. I bet there was similar talk when factories started putting in big CNC machines to automate some of the manufacturing process.
Re: Same old story
We also went through the same doomsday scenarios when the steel and rubber industry left the US permanently. The very simple economic reality is that companies will hire whoever gets the job done the cheapest and most reliably.
Re: Re: Same old story
We are exporting our jobs and standard of living, raising it other places (India programmers make less than U.S., but more than everyone else in India)- and probably lowering it here.
So is leveling the standard of living worldwide good for the U.S. or bad for the U.S.?
That's what they said last year and the year befor
Bush pushed his first set of tax cuts saying that the economy would improve and unemployment would go down…it didn’t and set a record.
They said if the Iraq war concluded quickly, the economy would improve and unemployment would go down…it didn’t and set a new, higher record.
Just this year, they warned us that if we didn’t give rich people and companies huge tax cuts, the economy would go into the toilet. Oddly enough, it seems, giving rich people and companies tax cuts sent the economy into the toilet anyway and unemployment numbers set a new, even higher record.
Now, they say unemployment will go down next year? Yeah just as soon as Bush gets in charge of the unemployment numbers and fixes those like he fixed the intelligence about Iraq…
Re: That's what they said last year and the year b
I didn’t realize this is a political rant sight. Aren’t there other places for this sort of drivel? (and I’m sure your griping changed the view of hundreds)
Gotta go…unemployment claims just hit a five month low, Microsoft announced they were hiring 5,000 more workers and my 401K is making a come back (oh yes – I’m “rich” – I make over $50,000 a year)
I will still care.....even after 2004
Take this with a grain of salt, the Gartner group has fubared almost all of their recent predictions so why would this one be correct. Gee there is a lot of blame to go around on this one, I mean quarterly earnings should not really be the bench mark a company should live by… shareholders demand earnings, CEO and management live quarter to quarter, so of course anything to trim costs and boost profits will be explored.
The long term implications are what scare me. I know in this economic environment we are all a little gun shy but I have a hard time envisioning what the good old USA will be producing 10 or 20 years from now. It looks like lawyers, food service professionals, and possibly bankers. Eventually we will lack the ability to design and manufacture in this country, add the fact that we may not be able to program and it limits our ability to compete. I guess every empire must decline and I guess if we last another 80-100 years we fit the historical pattern…
Re: I will still care.....even after 2004
Here’s the part I don’t get. Everyone keeps saying that because they don’t see what the US will be doing in the future, we must all be doomed.
However, every time in the past that we’ve ended up outsourcing jobs overseas the US has ended up focusing on a new industry that has helped build our economy even more than the old one.
No Subject Given
It’s interesting to me how few people are able to examine the positive secondary consequences of cost cutting through outsourcing, automation, or lay offs.
If $X is saved through outsourcing 1,000 positions to India, the immediate impact that people notice is that there are 1,000 fewer jobs in the U.S. However, few people pay attention to how the money saved can be used. There are a number of possibities:
1. Pass the savings on to customers. Upon spending less money, they will spend or invest the money that they saved elsewhere, promoting new development.
2. Expand the product line or the production of existing products. Doing the latter can cut prices.
3. Use the money saved to create new research and development jobs (which is precisely what Microsoft is doing — they’ve announced the creation of 5,000 R&D jobs only weeks after announcing the outsourcing of thousands of low-end jobs to India).
4. Raise the salaries for CEO’s — the only really negative option, although that can spur development in tourism, I suppose 🙂
Keep in mind that the opposite of globalization is self-sufficiency, which equates to poverty, as we saw in the Middle Ages when there were political barriers restricting trade between neighboring cities. I doubt people would wish to return to that, but they’re support for protectionism on the national level follows the same principle.
Re: Outsoursing kills
Well , for example Accenture outsourced big project to Taty , well as part of the project Taty establishes legal presence in the US, supplies Architects, Business Analysts and Project Managers to gather requirements.
As part of requirement gathering Taty’s people communicate with the client, learn business, train themselves . The next step ? What would you guess , they will have second project without Accenture as a middle-man. At the end they will squeese those greedy people from Accenture from the market.
So what do you think about it ?