"Doesn't anyone around here know how to play this game." The idea is to develop jobs for American citizens not foreign citizens.
Posted on 07/30/2003 3:16:14 PM PDT by demlosers
NEW YORK (Reuters) - One out of 10 jobs in the U.S. computer services and software industry could shift to lower-cost emerging markets such as India or Russia by the end of 2004, a top computer consultancy said on Tuesday.
Gartner Inc., the world's biggest high-tech forecasting firm, said in a report entitled "U.S. Offshore Outsourcing: Structural Changes, Big Impact" that 500,000 of the 10.3 million U.S. technology jobs could move just in 2003 and 2004.
While professionals in the computer industry itself are likely to bear the brunt, the report predicts that one in 20 tech jobs in industry-at-large also could be moved overseas.
This is especially true in industries with high concentrations of knowledge workers such as banking, health care and insurance, the author of the survey said.
"Suddenly we have a profession -- computer programming -- that has to wake up and consider what value it really has to offer," Diane Morello, a Gartner vice president and research director who studies work force issues said in an interview.
"Offshore outsourcing" is the euphemism the computer industry uses to describe the transformation of software development, computer services and customer call-center work.
As a global economic recession has hit hard over the past two years, U.S. companies have embraced as never before a decades-old trend to hire educated workers overseas who can be employed for a fraction of the cost of U.S.-based programmers.
Just last week, software maker Siebel Systems Inc. SEBL.O of San Mateo, California said it would cut 9 percent of its work force, or 490 jobs, and planned to move some operations overseas.
Executives of the world's largest computer and services company, International Business Machines Corp. were quoted recently as saying they had no competitive choice other than to expand software and semiconductor development overseas. The comments came to light in a recording supplied by a union seeking to organize IBM workers and supplied to Reuters. IBM now employs 5,400 workers in India out of a total work force of 316,000.
A JOBLESS TECH RECOVERY?
The debate by economists over whether the United States may now be experiencing a jobless economic recovery echoes disputes over high-tech job losses that heated up during the last technology recession a decade ago. These petered out quickly in the Internet boom of the late 1990s.
The recent acceleration of job losses actually began during the late 1990s when shortages of qualified U.S.-based workers led companies to turn overseas to countries such as India, Ireland and elsewhere for computer and Internet project work.
The mounting job losses are heating up as a political issue, with bills put forward by legislators in five U.S. states that would require workers hired under state contracts be American citizens or fill a special niche citizens cannot fill.
Morello said her study did not speculate on where such jobs were moving. But she indicated that India, Russia and other countries in Southeast Asia were the most likely locations.
She also pointed to how Canada has moved recently to position itself as a "nearshore" alternative to companies who have trouble shifting jobs to more distant "offshore" locales.
Electronic Data Systems Corp. EDS.N of Plano, Texas, the world's second largest computer services provider, has already reached into Canada and many points beyond. EDS has begun promoting its "Best Shore" strategy of positioning software and customer service work in what it says are the most cost-effective locations around the globe.
EDS has 16 centers that range from New Zealand to India to Egypt, Poland, Brazil, and Canada.
The Gartner analyst said that based on her preliminary calculations that one in 10 software services jobs are at stake at computer vendors and 5 percent of technology jobs in the wider corporate world, at least 500,000 jobs will be moved. (Additional reporting by Caroline Humer)
If so, it was shortsighted and partially blind. A lot of electronics and cars were already being imported years ago. How could high tech not continue to be imported? How could data entry and telephone answering services possibly be kept home? This didn't happen overnight.
Yeah, we did. It didn't just happen, though, this dates back to the post Civil War era when America's industrial output grew from #5 in the world to bigger than #2,3,4, 5 combined in a matter of a couple decades. It's going to take another such revolution to keep America on top of the heap much longer. Post-industrial high-tech was a fine buzzword, but the substance isn't there. We have to put it there. Seriously, if you're annoyed at our lack of exponential progress lately, do something. Henry Ford did it then, who can do it now?
I commonly visit a website where in the backwater of NM machinists, welders, boilermakers keep alive skills long lost in this country (and most of the world). These few people are dedicated to keeping a half dozen steam locomotives alive and running because the economy of their small town and one in CO is dependent on the tourist dollars the RR brings in. A similar thing may well happen on an infinitely larger scale in this country if the drain of jobs and the skills that make them possible are lost. Just like the steam engine is not coming back and survives as an historical curiosity, our manufacturing and high tech jobs are not likely to return either, leaving this country in a much more precarious position to survive as we once knew it.
The only reason to fear globalization is if you think you can't be competitive in a global market.
Try shipping something TO China. That 50% tariff wall makes it a little tough.
Too bad the reverse isn't true to level the playing field.
In the near future (heck right now) your customers aren't going to be low wage Wal*Mart drones, they will be the cream of the crop from around the globe.
With almost half of world GDP located within the borders of the United States and 90% of that being consumer spending, be very worried. Your customer isn't the 'cream of the crop' in Tanzania. He is still down the street from where you live right now.
They just needed to be more competitive, and now they are starting to be.
If they did it all by themselves, more power to them. Since *we* are gutting ourselves and sending it over there, I'd say that the competition still doesn't exist.
Its a race to the bottom. Who will get there first? What will you do when US GDP falls from 50% to something like 20% of world output, but the guy in China still can't afford to buy your product because he only makes a nickel a day? What then?
Like I said, step back and look at the bigger picture. Unless you are absolutely, positively, the only person in your industry....be worried about the global economy contracting as wages plummet globally.
Then figure out who your customer is going to be once that is done. The microeconomics look great, but the macroeconomic picture is dismal at best.
It's part of the deal. We're a long way from having anything like justice as we are familiar with show up in the world at large. But that's because we are new to this global business environment. Issues of justice will be resolved gradually in the course of time, but in the meantime we have business and communication just taking off. Even the ability to discuss things worldwide within minutes is a brandnew capability and we have just a hint of where that is going. I'll bet it's a lot like when Europe officially discovered the New World, but this time the new World is the Whole World. Are Americans ready for this?
"Doesn't anyone around here know how to play this game." The idea is to develop jobs for American citizens not foreign citizens.
Judging by the public schools, HELL NO!
Yes, but it was still one country, bound together by a common set of laws, language, religion (Judeo-Christian) and a belief that with these and freedom as a foundation a better life could be had for a man and his family. Do you see this happening in a world where this commonality does not exist and where freedom for the individual is not revered?
There are other things we can do....:)
Agreed?
Yes and no. I will agree that we're being shafted. I will also agree that not everyone is playing by the same rules. I will also agree that the tax bill the Dems will hand us from this will rival Socialist Sweden before they are done.
But I will agree that something needs to be done. I just have no clue what yet aside from arguing "fair trade" as opposed to "one-sided [so-called 'free'] trade." Building a better mousetrap doesn't seem to be working....:(
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