U.S. receiving more 'outsourced' jobs than it's losing

Bloomberg ^ | 04/02/04 | Art Pine

[Pikamax]

Posted on Fri, Apr. 02, 2004

U.S. receiving more 'outsourced' jobs than it's losing

By Art Pine

BLOOMBERG NEWS

Democratic presidential candidate John Kerry was asked recently if his plan to tax U.S. companies that move work overseas addressed an "overblown" issue, considering the jobs non-U.S. companies create in America.

"Nope, not if you talk to any worker that's out there," Kerry said in an interview.

He hasn't talked to Barry Bell, a 39-year-old section leader of a Bayerische Motoren Werke AG factory in Spartanburg County, S.C. He joined BMW when the world's second-largest maker of luxury cars opened the plant in 1994.

"I think it's a great opportunity," Bell said of the arrival of Munich-based BMW and other non-U.S. companies in South Carolina in recent years. "We've seen a big explosion" of jobs offered by overseas employers, he said in an interview.

Bell and BMW illustrate the flip side of the election-year debate in the United States over job "outsourcing." While U.S. companies including Hewlett-Packard Co., the world's second- largest computer maker, and AIG Life Insurance Co., the world's largest insurer, have transferred white-collar work to low-wage countries such as India and China, more jobs are coming the other way, according to government estimates and trade analysts.

"Any way you slice it, the world is creating or transferring more jobs to the U.S. than we are doing to the rest of the world," said Daniel T. Griswold, a trade specialist at the Cato Institute, a research organization in Washington.

India's Essel Propack Ltd., Taiwan's Teco Electric & Machinery Co. and Denmark's Vestas Wind Systems A/S all have built plants in the United States in the last year and a half.

Other non-U.S. companies announced plans to increase hiring in the United States last year including Japan's Nissan Motor Co., with 3,350 jobs in Canton, Miss.; DaimlerChrysler AG of Germany, with 2,000 at a new Mercedes-Benz plant in Vance, Ala.; German appliance distributor BSH Bosch and Siemens Hausergate GmbH, with 1,300 in New Bern, N.C.; and Magna International Inc. of Canada, with as many as 800 in Bowling Green, Ky.

The movement of U.S. jobs abroad "has been blown out of proportion" mainly because domestic companies in the United States have been slow to increase hiring, said Martin Baily, chairman of former President Bill Clinton's Council of Economic Advisers. "There was lots of offshoring going on in the 1990s, but job growth was so strong in the U.S. that nobody really took much notice."

While reliable figures aren't available for the last two years, the Commerce Department estimated on March 18 that the number of Americans employed by U.S. affiliates of majority non-U.S. companies grew by 4.7 million from 1997 through 2001. In the same period, the number of non-Americans working at affiliates of majority-U.S. companies abroad rose by 2.8 million.

The creation of jobs outside the United States by American companies hasn't played a significant role in the current "jobless recovery," said Baily, now a senior fellow at the Institute for International Economics, a nonpartisan research group in Washington, in an interview Wednesday.

Since Republican George W. Bush became president in January 2001, the U.S. economy has shed 2.2 million jobs. In each of the past six months, payrolls have grown by an average of 61,000, compared with 207,000 a month at the same point after the 1990- 1991 recession.

The United States will provide another snapshot of its job situation today, when the Labor Department is to publish its March employment report. The government said March 5 that payrolls grew by just 21,000 workers in February, a sixth of the median forecast of economists surveyed by Bloomberg News.

No president since Herbert Hoover during the Great Depression in 1933 has ended a term with a net decline in U.S. employment. Ronald Reagan is the only president in the past 30 years to be re-elected following a recession that began during his term. The last recession began in March 2001 and ended in November of that year.

A CNN/USA Today/Gallup poll taken between March 5 and March 7 showed that 58 percent of 1,005 American adults in the sample said the issue of keeping American jobs from going overseas will be "very important" in determining their vote for president, and 27 percent considered it "fairly important."

Walter Wriston, the former chief executive of Citicorp, the world's largest financial company, is among those who say such concerns are misplaced.

"Some commentators have gone so far as to suggest that American CEOs whose companies outsource jobs should be censured or fired," Wriston, 84, wrote in the Wall Street Journal. "This lament would make more sense if it came from countries around the world that are outsourcing their jobs to the U.S. in huge numbers. The balance of jobs we import from abroad greatly exceeds the jobs we export abroad."

Kerry, the 60-year-old senator from Massachusetts, has made the movement of jobs abroad a centerpiece of his attacks on Bush. In a speech Feb. 19, Kerry vowed to "repeal every tax break and loophole that rewards any Benedict Arnold CEO or corporation for shipping American jobs overseas."

The 57-year-old Bush holds up the creation of U.S. jobs by companies from abroad as an example of the benefits of free trade. In a speech in Cleveland on March 10, he said 10 percent of Honda's worldwide workforce lives in Ohio. Honda has two vehicle-assembly plants in two Ohio towns.

"About 16,000 Ohioans work for Honda, with good, high-paying jobs, and that's not counting the people who work at 165 different Ohio companies that supply Honda with parts and material," Bush said. "When politicians in Washington attack trade for political reasons, they don't mention these workers, or the 6.4 million other Americans who draw their paychecks from foreign companies."

Even companies from India are creating jobs in the United States. India's Essel Propack, the world's largest maker of laminated tubes for packaging consumer products, based in Mumbai, is adding 50 positions to its toothpaste tube manufacturing plant in Danville, Va. The additions will bring total employment at the factory to 137.

[Ciexyz]

"Good news" bump.

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[Shermy]

more jobs are coming the other way, according to government estimates and trade analysts.

And this writer doesn't grace us with the statistic or estimate of his premise. Instead we get a flurry of info that doesn't prove anything about the premise, but wants to appear as such. Just more disinformation.

Don't worry, be happy...

[Sweet Land]

The movement of U.S. jobs abroad "has been blown out of proportion" mainly because domestic companies in the United States have been slow to increase hiring, said Martin Baily, chairman of former President Bill Clinton's Council of Economic Advisers. "There was lots of offshoring going on in the 1990s, but job growth was so strong in the U.S. that nobody really took much notice."

While reliable figures aren't available for the last two years, the Commerce Department estimated on March 18 that the number of Americans employed by U.S. affiliates of majority non-U.S. companies grew by 4.7 million from 1997 through 2001. In the same period, the number of non-Americans working at affiliates of majority-U.S. companies abroad rose by 2.8 million.

So I guess according to the Rats and Buchananites, *we* must be the bad guys.

[monday]

So where are all those whining weenies, worried about jobs, at now? It never fails to amaze me how people who would be outraged if you told them how to conduct their business, never the less, will tell you with a clear conscience, how the government should step in and regulate how and where other companies can operate. Is this still a free country or what?

[Shermy]

Even companies from India are creating jobs in the United States. India's Essel Propack, the world's largest maker of laminated tubes for packaging consumer products, based in Mumbai, is adding 50 positions to its toothpaste tube manufacturing plant in Danville, Va.

Worth a reread. this is the best he can do, 50 toothpaste jobs? What a laugher.

[1rudeboy]

Let us know when you finish reading. Better yet, don't bother.

[Codeflier]

Maybe if you spent as much time doing something productive as you do worrying about job outsourcing, you would be gainfully employed.

[Cold Heat]

Outsourcing is a total "red herring", EXCEPT from a security standpoint.

These things DO need to be looked into.

[motzman]

Here ya go, kid

[Shermy]

Thanks for the pic, but I'd rather closely read the article.

[ex-snook]

""I think it's a great opportunity," Bell said of the arrival of Munich-based BMW and other non-U.S. companies in South Carolina in recent years. "We've seen a big explosion" of jobs offered by overseas employers, he said in an interview. "

Just one question. Do these BMW's get shipped back to Germany like the outsourced HP products get shipped back to here?

[kjam22]

The real productive thing to do would be to sit at home and buy stock in companies who are moving their manufacturing jobs to asia or mexico. Nice short term profits, for easy quick gains. And there's enough of them to keep you busy investing for a while.

[1rudeboy]

For the record, your concern in your reply #4 is addressed in paragraph ten, and #7 in eight. There is a downside to only reading the beginning and end of an article, as you are discovering.

[1rudeboy]

The BMW plant exports almost half of its finished product.

[Cronos]

Do these BMW's get shipped back to Germany like the outsourced HP products get shipped back to here?

Err... Yeah they do. American workers are cheaper than their German counterparts.

[1rudeboy]

As a matter of fact, the Spartanburg plant is the only source of Z3's in the world.

[1rudeboy]

Don't you get tired of slapping-down that "we don't export anything, anywhere, anymore" myth? By the time I eat dinner tonight, someone else will have resurrected it.

[1rudeboy]

And don't forget the notorious corollary, the "well, we build it here but the parts come from elsewhere" myth.