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Big U.S. Firms Shift Hiring Abroad
WSJ ^ | 19 April 2011 | DAVID WESSEL

Posted on 04/22/2011 10:34:53 AM PDT by Palter

Work Forces Shrink at Home, Sharpening Debate on Economic Impact of Globalization

U.S. multinational corporations, the big brand-name companies that employ a fifth of all American workers, have been hiring abroad while cutting back at home, sharpening the debate over globalization's effect on the U.S. economy.

The companies cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million, new data from the U.S. Commerce Department show. That's a big switch from the 1990s, when they added jobs everywhere: 4.4 million in the U.S. and 2.7 million abroad.

In all, U.S. multinationals employed 21.1 million people at home in 2009 and 10.3 million elsewhere, including increasing numbers of higher-skilled foreign workers.

The trend highlights the growing importance of other economies, particularly in rapidly growing Asia, to big U.S. businesses such as General Electric Co., Caterpillar Inc., Microsoft Corp. and Wal-Mart Stores Inc.

The data also underscore the vulnerability of the U.S. economy, particularly at a time when unemployment is high and wages aren't rising. Jobs at multinationals tend to pay above-average wages and, for decades, sustained the American middle class.

Some on the left view the job trend as reason for the U.S. government to keep companies from easily exporting work overseas and importing products back to the U.S. or to more aggressively match job-creating policies used in some foreign markets. More business-friendly analysts view the same data as the sign that the U.S. may be losing its appeal as a place for big companies to invest and hire.

"It's definitely something to worry about," says economist Matthew Slaughter, who served as an adviser to former president George W. Bush. Mr. Slaughter, now at Dartmouth College's Tuck School of Business, is among those who think the U.S. has lost some allure.

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; Culture/Society; Foreign Affairs
KEYWORDS: economy; giantsuckingsound; globalization; offshoring

1 posted on 04/22/2011 10:35:02 AM PDT by Palter
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To: Palter

we need a president who will lead the country back to

taxes and regulations that encourage american jobs.


2 posted on 04/22/2011 10:55:18 AM PDT by ken21 (dem taxes + regs + unions = jobs overseas.)
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To: ken21

We need Americans to except lower wages and a lower standard of living. It’s the only way to compete.


3 posted on 04/22/2011 11:05:23 AM PDT by Wolfie
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To: ken21

This is why Trump can win.


4 posted on 04/22/2011 11:06:30 AM PDT by dfwgator
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To: Palter

The thing I love about American capital is that it has no loyalty to this country unless it asks the US taxpayer to bail them out with bail outs, low-interest loans, grants, subsidies, government contracts and special provisions in the tax code.

Don’t demand the US government protect your assets overseas when these foreign governments want to nationalize your assets.

My philosophy is American capital can do what it wants, but don’t ever come hat in hand to the federal government for anything.

Capitalism is good; crony capitalism is not good.


5 posted on 04/22/2011 11:08:29 AM PDT by radpolis (Liberals: You will never find a more wretched hive of scum and villainy)
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To: dfwgator

agree.

and palin.


6 posted on 04/22/2011 11:08:54 AM PDT by ken21 (dem taxes + regs + unions = jobs overseas.)
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To: Wolfie

to accept lower wages is the argument of the globalists’

“harmonization”.

maybe, but with increased productivity by new technology,

maybe not.


7 posted on 04/22/2011 11:11:14 AM PDT by ken21 (dem taxes + regs + unions = jobs overseas.)
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To: ken21

“we need a president who will lead the country back to
taxes and regulations that encourage american jobs.”

If GE was not cited, I might think you had a point.


8 posted on 04/22/2011 11:25:03 AM PDT by DonaldC (A nation cannot stand in the absence of religious principle.)
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To: ken21

“...taxes and regulations that encourage american jobs.”

Please name a few taxes and regulations that encourage jobs. I cant think of a single tax or regulation that is esponsible for creating a job. Unless of course you include governemnt make work jobs.


9 posted on 04/22/2011 11:30:41 AM PDT by FreedomNotSafety
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To: ken21

“...taxes and regulations that encourage american jobs.”

Please name a few taxes and regulations that encourage jobs. I cant think of a single tax or regulation that is esponsible for creating a job. Unless of course you include governemnt make work jobs.


10 posted on 04/22/2011 11:30:47 AM PDT by FreedomNotSafety
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To: Wolfie

We need Americans to except lower wages and a lower standard of living. It’s the only way to compete


Spoken like a true UN Globalist Free Trade Communist

And, who will buy the products in your low wage, low standard of living Communist Utopia?


11 posted on 04/22/2011 11:34:03 AM PDT by UCFRoadWarrior (Karl Rove = Karl Marx)
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To: dfwgator

This is why Trump can win.


This is why the media on both the left and right are attacking Trump

Both the DNC and GOP support this Free Trade Communism nonsense. I am tired of the loss of jobs and the loss of soverignty. I do not want to be Communist Chinese or Drug Cartel Mexico


12 posted on 04/22/2011 11:36:15 AM PDT by UCFRoadWarrior (Karl Rove = Karl Marx)
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To: FreedomNotSafety

semantics.


13 posted on 04/22/2011 11:42:40 AM PDT by ken21 (dem taxes + regs + unions = jobs overseas.)
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To: radpolis

We’ve lost our ‘innovation’ mojo.
US is only 5% of world population. That means 95% of our ‘customers’ are outside of the country.
How do we get to that market?
Ever think these ‘customers’ are just like us. They want the products AND the jobs?


14 posted on 04/22/2011 11:49:49 AM PDT by griswold3 (Character is destiny)
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To: UCFRoadWarrior; All
I love it when Freepers who claims to be conservative but speaks like a communist when it comes to economics.. We need less regulation not more..

People who supports Trump is a Chump...
15 posted on 04/22/2011 11:52:33 AM PDT by KevinDavis ( Anyone who backs Trump is a chump..)
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To: Palter

It would seem to me that a tax policy could be used to encourage companies to continue to produce their product in the United States. If companies were taxed for their offshore profits, but not for their onshore profits, they might think differently.

While I’m not generally in favor of taxing corporations, it can be argued that those kinds of taxes are really nothing more than consumption taxes, since only the purchasers of that company’s product pay the tax.

I truly believe a flat tax, with perhaps a simple one or two step progression of rates is the fairest way to tax people and corporations.

Gross earnings < $20,000 = 5% tax
> $20,000 < $200,000 = 10%
> $200,000 = 15%
The above rates would be adjusted for inflation, but gross incomes would be the measuring stick. No deductions for anything.


16 posted on 04/22/2011 11:55:02 AM PDT by khenrich (And people thought Jimmy Carter was our worst president........)
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To: dfwgator

This is why Trump SHOULD win (if he is sincere).


17 posted on 04/22/2011 12:02:40 PM PDT by 353FMG (The M1911 is mightier than the sword.)
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To: Wolfie

You didn’t expect reasoned responses, did you?


18 posted on 04/22/2011 12:09:27 PM PDT by r9etb
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To: radpolis
Capital is capital; it has no nationality, no loyalty, and no compassion. No nation may lay claim to it, in fact, those that do will only hasten it's departure from their shores. It flows inexorably to it's highest valued use, and those who think they can stop it are fools. It can only be coaxed, never coerced.
19 posted on 04/22/2011 12:17:10 PM PDT by Red Boots
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To: Wolfie

There are all sorts of ways to compete.

Better Quality
Lower Prices
More Productivity
Better Innovation

The cost of labor in producing an automobile in the USA makes up about 13% of the manufacturing costs or about 6.5% of the retail price.

(http://msl1.mit.edu/classes/esd123/vyas.pdf)

US made goods are expensive in large part because of all the excessive constraints to free market.

Allow a company to produce cars without interference from unions, the EPA, OSHA or the army of blood sucking tort lawyers, but constrained by honor and decency (Yes, Virginia, these did exist prior to the alphabet agencies or the Bar Association.) and you would see US made products compete world-wide.

BTW, if the “Quantitative Easing” keeps printing funny money, the US Dollar will be so devalued that US Good will be very cheap on the world market.


20 posted on 04/22/2011 12:39:21 PM PDT by BwanaNdege ("If we don't stand for something, we shall fall for anything" - Peter Marshall)
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To: Palter

Is this that giant sucking sound R.P. was talking about?


21 posted on 04/22/2011 12:41:36 PM PDT by wrench
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To: BwanaNdege
...constrained by honor and decency...

Now THAT'S funny.

22 posted on 04/22/2011 12:47:11 PM PDT by Wolfie
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To: Wolfie

“Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”

John Adams


23 posted on 04/22/2011 12:50:32 PM PDT by BwanaNdege ("If we don't stand for something, we shall fall for anything" - Peter Marshall)
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To: Wolfie

“We need Americans to except lower wages and a lower standard of living. It’s the only way to compete.”

We can also embargo enemy countries like Red China, and put regulations in place to stop imports from countries where 5 year-olds work 15 hour shifts...


24 posted on 04/22/2011 1:01:32 PM PDT by kearnyirish2
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To: kearnyirish2

Sounds like anti-business claptrap to me.


25 posted on 04/22/2011 1:28:42 PM PDT by Wolfie
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To: ken21

Our economy will continue to export jobs until government policies make employing Americans here more competitive...IRS, FICA, OSHA, EEOC, EPA...and on and on. Instead we do every thing possible to see that the jobs that can’t be exported go to illegals from other countries.


26 posted on 04/22/2011 1:37:22 PM PDT by dogcaller
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To: Palter

Where is Patriotism? Why the bowing down to the almighty dollar?
Why do we let unions kill jobs here in America?
Sickening!


27 posted on 04/22/2011 2:15:43 PM PDT by vpintheak (Democrats: Robbing humans of their dignity 1 law at a time)
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To: vpintheak
Why do we let unions kill jobs here in America?

What are you talking about, union membership is at an all time low.

It's not Unions killing jobs.

28 posted on 04/22/2011 2:19:40 PM PDT by Palter (If voting made any difference they wouldn't let us do it. ~ Mark Twain)
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To: Wolfie

“Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”

John Adams


29 posted on 04/22/2011 2:32:46 PM PDT by BwanaNdege ("If we don't stand for something, we shall fall for anything" - Peter Marshall)
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To: Palter
"What are you talking about, union membership is at an all time low."

Yep and so are taxes. Taxes and union blame is the mantra of job exporters. The real reason is they make more money using cheap labor, child, sweatshop or otherwise. Hiring in other countries while Americans are unemployed is not to be admired anymore than profit justifies the sale of products that would endanger our security.

30 posted on 04/22/2011 2:53:03 PM PDT by ex-snook ("Above all things, truth beareth away the victory")
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To: Palter

A little bit of devils advocate here, not as a defense for everything that some big companies can do, but:

If the total numbers are driven by similarities to the three companies shown above - Oracle, GE and Caterpillar, then their anecdotal evidence suggests that the statistics, plus the context, company by company, may be less significant (in terms of U.S. “losses”) than they seem.

Both Oracle and GE did not have fewer U.S. employees. They both did grew more in employees outside the U.S., than in the U.S. because of acquisitions of foreign companies and their own growth overseas. While GE’s drop in its total U.S. employees was during a period when GE was selling divisions and subsidiaries to others; a process it is not done with yet.

When a U.S. based company, like GE, sells a U.S. based business or some U.S. operation, that may show up in the numbers as “fewer U.S. employees”, for them and for “U.S. multinationals”, but, in that case it does not represent fewer “U.S. jobs”. For instance, NBC and it’s jobs are not going away when its ownership shifts from “multinational” GE to “domestic” Comcast.

When Toyota greatly increased how much of it’s production it shifted from its own plants to hundreds of outisde contractors, mostly domestic, it probably reflected a “reduction” in the total number of Japan-based “Toyota” jobs, but was not a reduction of “Japanese jobs” per se. Much of that same sort of thing has been going on in the U.S. “multinational” car industry for more than a decade. Jobs have not just shifted from Ford, GM and Chrysler (and seen as fewer employees on their payrolls) to contractors overseas, they have shifted work from themselves to U.S. contractors as well; in addition to selling off operations to U.S, businesses. That may have affected their own “number of jobs” more than it affected “U.S. jobs”.

By that understanding, every job that leaves the payroll of a U.S. multinational company is not necessarily a job that leaves the U.S., and every time a company’s jobs grow more overseas than in the U.S. it is not necessarily at the expense of U.S. jobs and can be attributed to growth of the company’s business in other markets.

I think it’s possible that what is being seen in the “U.S. multinational” “number of employees” statistics is likely to be seen in the numbers for “multinationals” worldwide.

That’s not to dismiss the fact that there are fewer manufacturing jobs in particular. But, not all of that loss was “exported”; a good amount came from a huge increase in automation and robotics. Almost nothing made today requires as many “manufacturing plant floor” workers to produce as was required 10, 20 and 30 years ago. And manufacturing as a whole is not at the end of those advances either. The other shift in manufacturing and in multinationals has been the movement of jobs and job categories to the payroll of someone else - [”let’s focus on our core business and hire some other outfit to do that”]. Some of that does involve “export” of jobs, but not all. Some just moves jobs from a bigger company to a smaller company in the same job market.


31 posted on 04/22/2011 3:20:07 PM PDT by Wuli
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To: Palter

Keep doing it, big shots. Let’s see your experiment in globalism through. Oh, and be ready to move permanently to your preferred countries, because policies will probably change abruptly at some point in time.


32 posted on 04/22/2011 4:24:56 PM PDT by familyop ("Nice girl, but about as sharp as a sack of wet mice." --Foghorn Leghorn)
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To: Palter

And Trump shall win.


33 posted on 04/22/2011 4:26:13 PM PDT by familyop ("Nice girl, but about as sharp as a sack of wet mice." --Foghorn Leghorn)
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To: Wolfie

OK, I uess we should just settle down to our straw huts and bowl of noodles. On New Years we may even get a bit of meat!


34 posted on 04/22/2011 4:47:50 PM PDT by kearnyirish2
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To: ken21
A U.S. company I once worked for, did very well through the last recession, much of their sales overseas, and much cash on hand, also overseas. Because it couldn't bring this cash home without incurring a tax penalty (after having already paid taxes abroad), it sold itself to a foreign multi-national. (At least, that was one of the reasons.)

At the same time, to make itself attractive to prospective buyers it had been shedding jobs in the U.S. and hiring in India, China and Singapore.

35 posted on 04/22/2011 4:56:56 PM PDT by Revolting cat! (Let us prey!)
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To: Palter

Why do I keep hearing so much about unions then? UAW, SEIU, Governemnt workers, Teachers, who else. If unions are so small then why do they have so much power?

Now, can you give me a name of anyone else out there who actually maybe could win?


36 posted on 04/22/2011 5:56:13 PM PDT by vpintheak (Democrats: Robbing humans of their dignity 1 law at a time)
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