no, there was no direct conversation about what drove the outsourcing shift. But the implication was that they were doing it because they could. There are no laws restricting offshoring, and wages in india are 1/4 what they are here at best, there are not many worker protections and NO benefit costs. The trend started with IT, the IT dept went first, and it was easiest because many of the workers in IT were on *temporary work visas* (something that needs to be critically reformed), and since the economy was so bad, the management knew that these guys couldn't get new jobs here and they would have to go home. So management cut their jobs and said when they got back to india they could take their same job again. I believe these temporary work visas ushered in this whole offshoring trend and thats why I am against any temporary visas in the future. I am for visas and immigration, but I think people should stay once they come. Anyway this offshoring of IT went to india first and it was successful (more or less), and then we were sitting talking about what else could go. The list they came up with was accounting/Finance, personnel and the benefits hotline, and finally R&D/QA. Well, thats practically the whole company only leaving sales and marketing plus a few executives and facilities. Multiply this to every US multinational corporation, especially in the new economy areas of tech and finance, and you've got a crisis on your hands.
I was indifferent on this practice until engineering went. I no longer believe this is comparative advantage and I think it is damaging to the viability of the USA economy long term. If you are interested in offshoring the business week series of articles is pretty good. All I would say though is that I don't see any evidence in high tech that productivity is the culprit in the job loss. It is all offshoring in this industry, because there are actually *more* workers in total now employed in the industry than at the top of the bubble. |
