Outsourcing American Jobs

[anjel13]

This is a transcript from a report last night on CNN. Just thought it was interesting and wanted to share. What do you think?

PILGRIM: A shocking new report tonight about the escalating threat to American jobs from overseas outsourcing, and the study says small-and medium-sized businesses are now joining large corporations in exporting American jobs to cheap overseas labor markets.

Now Christine Romans is here with our report – Christine.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Kitty, by the end of next year, 80 percent of the biggest 2000 companies in the world will have moved jobs to cheaper overseas labor markets.

The researchers in this new report say a** more accepting political environment **will encourage many small- and medium-sized companies to send jobs abroad as well, and companies will find new industries to outsource, including retail, health care and manufacturing.

The report concludes that sending American jobs overseas is a corporate must-have, but not without risks. The researchers concede that 40 percent of outsourcing deals don’t save any money or the quality of the work is just too poor.

Now India will remain the center of the outsourcing boom. China and the Philippines will rapidly mature as new cheap labor markets, with Poland, the Czech Republic and Hungary following close behind.

The consultants say many more jobs move overseas next year and the year after. Mike Gilday (ph) at the AFL-CIO – he think so, too, but, unlike the consultants, he’s not happy about it.

He says more Americans are going to lose their jobs in the global chase for cheap labor, that American companies are pulling out of this economy hundreds of thousands of dollars in wages, benefits and taxes, and that, Kitty, will eventually have some dangerous consequences.

 

[dirtydog]

anjel13:

The researchers concede that 40 percent of outsourcing deals don’t save any money or the quality of the work is just too poor.

The company (major telecom outfit) I used to work for outsourced much of our IT and customer support operations to India. The customer support was so bad that they had to create a special customer support group to handle their business customers. That special group was comprised only of Americans with good English skills who didn’t have too much of an accent. The rest of us poor slobs had to continue to deal with reps thousands of miles away from us whom we could hardly communicate with.

 

[vern_humphrey]

When I was running for Congress, I was often asked, “How can we prevent jobs from being exported?”

The answer is, "Arkansas has an adult illiteracy rate of 22% – and some counties in this district have a rate over 40%. If you have a job that can be done by someone who can’t read or write, it will be done in China or Mexico.

"If we want to keep jobs in this country, we need three things:

1. A highly-educated workforce. We can’t compete with Mexico and China on wages. We must compete on technical abilities.
2. Lower taxes – we cannot tax ourselves into prosperity, but we can drive jobs overseas with high taxes.
3. Less pointless regulation. Regulation is a huge cost to business. Cut the regulation and make the United States a more competitive business location."

 

[caroljm36]

vern humphrey:

When I was running for Congress, I was often asked, “How can we prevent jobs from being exported?”

The answer is, "Arkansas has an adult illiteracy rate of 22% – and some counties in this district have a rate over 40%. If you have a job that can be done by someone who can’t read or write, it will be done in China or Mexico.

"If we want to keep jobs in this country, we need three things:

1. A highly-educated workforce. We can’t compete with Mexico and China on wages. We must compete on technical abilities.

Amen. Either people are dropping out or they’re spending time and money getting degrees that may boost their self-esteem but don’t provide real technical skills.

 

[chicago]

The U.S. may well be on a fast track to economic collapse. It wouldn’t be surprizing to see us go into a long term depression sometime in the next 20 years.

 

[WhatMeWorry]

chicago:

The U.S. may well be on a fast track to economic collapse. It wouldn’t be surprizing to see us go into a long term depression sometime in the next 20 years.

20 years?..The rate things are going downhill, try 5 to 10.

There are a lot of people, groups, countries in this world who would like nothing more than to see the U.S. destroyed, economically and otherwise. They could not care less if every U.S. citizen fell off the planet for good.

Sounds morose, but that’s how I see it. It’s all just a part of the Great Chastisement/Illuminati/Anti-Christ plot.

 

[HagiaSophia]

caroljm36:

Amen. Either people are dropping out or they’re spending time and money getting degrees that may boost their self-esteem but don’t provide real technical skills.

But then there is the other side of the coin; wages and costs - as long as companies find it far cheaper to manufacture free of the wacko environmentalists, lawsuits, and can reduce their costs - it does’t matter how many Ph.D’s we produce the outsourcing will continue.

 

[vern_humphrey]

HagiaSophia:

But then there is the other side of the coin; wages and costs - as long as companies find it far cheaper to manufacture free of the wacko environmentalists, lawsuits, and can reduce their costs - it does’t matter how many Ph.D’s we produce the outsourcing will continue.

Unquestionably, over-regulation drives business out – and so do junk lawsuits.

But the comprehensive answer to keeping jobs in the US is:

1. Have a workforce that can do what other countries’ people CAN’T do.
2. Reduce taxes.
3. Eliminate or dramatically reduce pointless regulation and lawsuits.

We need to do all three of those to remain competitive.

 

[davy39]

As far as I’m concerned, it’s mostly our fault that this has happened. If we hadn’t thought imported goods were so neat to have, and bought american made, maybe it would’ve helped. Now you have Wal-Mart that demands that lot of their suppliers move their production out of the US, or risk losing Wal-Mart’s business. It happens all the time, and it’s called corporate greed. I really don’t know what to do about this. I’m almost retired, but I wonder whaat the grandkids will be doing for a living.

 

[vern_humphrey]

davy39:

As far as I’m concerned, it’s mostly our fault that this has happened. If we hadn’t thought imported goods were so neat to have, and bought american made, maybe it would’ve helped. Now you have Wal-Mart that demands that lot of their suppliers move their production out of the US, or risk losing Wal-Mart’s business. It happens all the time, and it’s called corporate greed. I really don’t know what to do about this. I’m almost retired, but I wonder whaat the grandkids will be doing for a living.

No, it’s called being out-competed.

You can’t force consumers to shop where prices are highest. You can’t force business to operate at a loss.

We have to maintain a competitive edge if we are to survive – and that means doing the three things I listed.

 

[chicago]

vern humphrey:

No, it’s called being out-competed.

“Undercut” is the more appropriate term.

If people can’t afford to buy quality goods, all they are left with is junk. And a society based upon junk is not for long.

We can argue till we are blue in the face about how everybody ought to just keep advancing their skills. But not everybody in a society can or will be able to constantly “stay ahead of the curve”. Nor can everybody be a professional or a manager. The nature of the beast is such that there will always be a need for decent paying work which is more menial in nature. Take away potential jobs from such people and the economy eventually collapses, as they just can’t find work which will enable them to support themselves and a family, can’t buy quality goods, and ultimately this population may even end up needing to be supported to ever greater extent by everybody else, becoming a larger drain on the whole of society.

You can’t force business to operate at a loss.

But it is possible to survive (if necessary, as a smaller operation) that manages lower profit margins, even if that means being close to “break even”. Really, the problem is that nobody wants to look long term, beyond what the next quarterly profit will bring shareholders.

 

[vern_humphrey]

“Undercut” is the more appropriate term…

I sense a lot of frustration there. We can’t solve our problems with emotion – we have to stand up, look them in the eye, and accept responsibility for them.

chicago:

If people can’t afford to buy quality goods, all they are left with is junk. And a society based upon junk is not for long.

I gather you’ve never lived in the Far East.http://forums.catholic-questions.org/images/icons/icon12.gif

But we are not a society based on junk – except in our education system.

chicago:

We can argue till we are blue in the face about how everybody ought to just keep advancing their skills. But not everybody in a society can or will be able to constantly “stay ahead of the curve”…

To say “Not everyone” can do something ignores the fact that MOST people can do about anything they put their minds to.

And there’s no mental defect that affects Americans in general that prevents us from getting ahead and staying ahead of the rest of the world – which is where we are now. All we have to do is work, and we will not only maintain our lead, we will increase it.

chicago:

Nor can everybody be a professional or a manager. The nature of the beast is such that there will always be a need for decent paying work which is more menial in nature.

Human beings have more than two speeds, stop and go.

There are plenty of jobs for people of varying skills – IF we maximize our potential. If we fail to do that, we will fail, period. And we can blame no one for that failure but ourselves.

Our future is in OUR hands.

chicago:

Take away potential jobs from such people and the economy eventually collapses, as they just can’t find work which will enable them to support themselves and a family, can’t buy quality goods, and ultimately this population may even end up needing to be supported to ever greater extent by everybody else, becoming a larger drain on the whole of society.

A century ago, most middle class families had servants. There was a livery stable in every town, and wagon makers and buggy whip makers were flourishing.

Where did those jobs go, and why did the economy not collapse when they went?

chicago:

But it is possible to survive (if necessary, as a smaller operation) that manages lower profit margins, even if that means being close to “break even”. Really, the problem is that nobody wants to look long term, beyond what the next quarterly profit will bring shareholders.

That’s the Politically Correct argument – but the fact is, we have many American businesses that have lasted a century or more. You don’t do that without having a long-term vision.

Similarly, about 90% of all new businesses fail within the first two years. A competitive economy weeds out businesses with only a short-term outlook.

 

[Beaver]

I have posted this article on this site before, but here it is again.

catholicexchange.com/vm/index.asp?vm_id=1&art_id=22832

 

[chicago]

vern humphrey:

I sense a lot of frustration there. We can’t solve our problems with emotion – we have to stand up, look them in the eye, and accept responsibility for them.

Not sure where or why you sense “frustration”. I think that what I am doing is stepping back and objectively analyzing the matter for what it is. And “undercutting” is a more accurate assessment of that which usually happens.

I gather you’ve never lived in the Far East.http://forums.catholic-questions.org/images/icons/icon12.gif

In Chicago, the far east would be Lake Michigan.

In any case, I tend to find such comparisons relatively useless, as one must look at our own circumstances in and of themselves; and not merely try to dismiss them as compared to some extreme, as if that is a legitimate and equal alternative point of reference.

But we are not a society based on junk – except in our education system.

I’d beg to differ. We are increasingly a country which buys stuff which is cheap and unvaluable, and digs ourself into greater debt in the process.

To say “Not everyone” can do something ignores the fact that MOST people can do about anything they put their minds to.

This is pure idealism.

What I am saying is that a society, by it’s nature, depends upon a certain complementary balance whereby not everybody can do the same thing. There will be a natural give and take. If everybody could just handle “anything they put their minds to”, there would be no need for the services of anyone else in the world. Further, such just plain isn’t true. Some people are not talented at this or that. And others will merely not find a way to continually “transition” and “stay ahead of the rest” (which implies that there are others “left behind”, BTW). Reality is such, therefore, that there will always be plenty of people in a society who need jobs which are not considered the most attractive, advanced, and well paying. But these people still need to be able to work and get paid to maintain their family lives.

And there’s no mental defect that affects Americans in general that prevents us from getting ahead and staying ahead of the rest of the world – which is where we are now. All we have to do is work, and we will not only maintain our lead, we will increase it.

For one, it seems that the economists are recognizing that countries like China are going to overtake us as the world leader very soon. Secondly, if there is no work, what are we to do? And how will people buy products? Thirdly, there is a risk of an attitude of “workaholism” in your view. Perhaps what we as a society actually need to better learn (which could enrich us) is how to rest and appreciate life at a deeper level than mere mechanistic “productivity”.

A century ago, most middle class families had servants. There was a livery stable in every town, and wagon makers and buggy whip makers were flourishing.

Where did those jobs go, and why did the economy not collapse when they went?

Replaced with jobs where the average Joe could make a healthy living, not just $7 bucks an hour in a “service economy”.

That’s the Politically Correct argument – but the fact is, we have many American businesses that have lasted a century or more. You don’t do that without having a long-term vision.

Or the good fortune to laregly control the market.

A competitive economy weeds out businesses with only a short-term outlook.

OTOH, once a company has “made it”, they are often able to maintain as short-term of an outlook as they want and rack in the profits while the going is good, with little concern for the long term effects of their activity. The “bottom line” is what ends up mattering, people and society be damned.

 

[vern_humphrey]

chicago:

Not sure where or why you sense “frustration”. I think that what I am doing is stepping back and objectively analyzing the matter for what it is. And “undercutting” is a more accurate assessment of that which usually happens…

“Undercutting” is a perjorative term. It colors the discussion which follows, and amounts to a pre-judgement.

Yes, some countries can sell some products cheaper than we can make them. Is this wrong?

chicago:

In any case, I tend to find such comparisons relatively useless, as one must look at our own circumstances in and of themselves; and not merely try to dismiss them as compared to some extreme, as if that is a legitimate and equal alternative point of reference.

We must look to our own circumstances and accept responsibility for them.

We can never succeed by railing at forces beyond our control, not by worshiping at the cult of the victim. We must continue to be the strong, self-reliant people we have been in the past.

chicago:

I’d beg to differ. We are increasingly a country which buys stuff which is cheap and unvaluable, and digs ourself into greater debt in the process…

We buy things at the lowest prices we can find – that’s natural. But how do you get “unvaluable” out of that?

If we were self-sufficient in energy, we’d have a positive balance of payments – so clearly, our manufactured goods are world-wide winners.

chicago:

What I am saying is that a society, by it’s nature, depends upon a certain complementary balance whereby not everybody can do the same thing. There will be a natural give and take. If everybody could just handle “anything they put their minds to”, there would be no need for the services of anyone else in the world…

Any normal human being can master any subject – some take more time than others, but all can do it. We have differences in skill levels and abilities basically because of individual choices, not by limitations imposed by our faculties.

chicago:

Further, such just plain isn’t true. Some people are not talented at this or that. …

Some people are indeed more talented than others – but that doesn’t mean that they simply CAN’T do what the talented can do – they just can’t do it as easily or as fast.

By and large, it is motivation and attitude, not IQ, that determines how far a person will go in life.

chicago:

And others will merely not find a way to continually “transition” and “stay ahead of the rest” (which implies that there are others “left behind”, BTW)

But most will – and as we come to recoginze that by helping others, we help ourselves, more and more will be able to advance.

chicago:

Reality is such, therefore, that there will always be plenty of people in a society who need jobs which are not considered the most attractive, advanced, and well paying. But these people still need to be able to work and get paid to maintain their family lives.)

There will always be – and we will always need – entry-level jobs. But despite all the Cult of the Victim propaganda, very few people make a lifetime career out of flipping hamburgers or pushing brooms. With help, even fewer would be stuck in such jobs.

chicago:

For one, it seems that the economists are recognizing that countries like China are going to overtake us as the world leader very soon.

Therefore it behooves us to get off our butts and do something aobut it – like upgrading our education system, cutting taxes, and cutting useless regulation and junk lawsuits.

chicago:

Secondly, if there is no work, what are we to do? And how will people buy products? Thirdly, there is a risk of an attitude of “workaholism” in your view…

Would you rather have alcoholism, with people lying in the gutters?

chicago:

Perhaps what we as a society actually need to better learn (which could enrich us) is how to rest and appreciate life at a deeper level than mere mechanistic “productivity”

We’ll have plenty of rest lying in the gutters, dead drunk.

chicago:

Or the good fortune to laregly control the market.

The Cult of the Victim always ascribes success to either luck or cheating. It has to – because if people can get ahead by their own efforts, those who subscribe to the Cult have to accept that they are responsible for their own lives.

chicago:

OTOH, once a company has “made it”, they are often able to maintain as short-term of an outlook as they want and rack in the profits while the going is good, with little concern for the long term effects of their activity. The “bottom line” is what ends up mattering, people and society be damned.

The bottom line is, that’s not true. No company lasts for decades without a solid long-range plan.

 

[vern_humphrey]

Beaver:

I have posted this article on this site before, but here it is again.

catholicexchange.com/vm/index.asp?vm_id=1&art_id=22832

An excellent article – and a good analysis of the world economic situation.

We need to look to the future – and the future seems to be one where highly-educated people will do well. That tells us that we need to do a much better job of educating people in the US.

The world trend is to more efficiency. Useless regulation, high taxes and junk lawsuits detract from efficiency. We need to do something there.

There’s nothing wrong with the United States or our economy – if we simply remain the strong, self-reliant people we have always been. If we adopt the Cult of the Victim, believe all our problems are beyond our control, and give up, we will be left in the dust.

 

[caroljm36]

Vern, you’re all right. I’d vote for ya!

Personally I am not going to beat myself over the head about buying imported goods. I have bought stuff made in China, Indonesia, Turkey, Guatemala…I don’t mind giving those people a hand up. They’re starting the way we did, and England before us, and Holland did before them. Jobs like nursing and building trades can’t be outsourced–or they can by hiring immigrants if people here aren’t interested in learning these professions.

I’m sorry but I have seen too many people in my own life who have turned their nose up, or shrunk in fear from, local educational opportunities or entry-level jobs that would have given them good portable skills. And I have seen others who have taken advantage, sometimes reluctantly, and are doing very well now. I know that we are supposed to believe that there are other unknown people someplace else who just have it terrible, but I can’t seem to see past the real world around me. The poor people I come in contact with at the homeless shelter have various reasons for their plight, often a criminal history or alcoholism, and there are dozens of nonprofits falling all over themselves to help them get into the workforce whenever they’re ready to meet them halfway.

 

[vern_humphrey]

During the campaign I had a discussion with a lady who runs a store in Jackson County, Arkansas.
She didn’t really care about whrere the merchandise came from, but her gripe was, “People would rather buy a shirt from Wal Mart for $2.00 than come to my store and buy it for $28.00!!”

It was all I could do to keep from slapping my forehead and saying, “Well, DUH!”

I invite people to watch “You’ve Got Mail” (with Meg Ryan and Tom Hanks.) This is about a big chain book store opening and the spunky operator of a little book store that is threatened. She gets friends together and pickets the big store, goes on TV, talks to the City Council and so on.

I ask people to analyze the strategies of the two stores. The big chain strategy is, “Give the customer what he wants. Provide a wide selection at a good price in a convivial atmosphere.”

The little store strategy is, “Screw the customer! Use the power of government to limit their choices, keep prices high and FORCE them to shop in my store.”

 

[jsk]

chicago:

The U.S. may well be on a fast track to economic collapse. It wouldn’t be surprizing to see us go into a long term depression sometime in the next 20 years.

I believe you have too little faith in the United States and it’s people. A few years back, I was laid off and had to find another job. I ended up geting a job as an engineer for Recaro Aircraft Seating, a German company opening it’s first U.S. plant, largely to pacify American Airlines, a new and important customer.

Despite the reputation of German excellence, in our first year of operation we were able to beat the established German plants in schedule, cost, and quality. We were ranked ahead of the parent company in quality by both Boeing and American Airlines. We also had better customer service.

I have since left Recaro and returned to my previous job, but Recaro Fort Worth is getting more work because of the weakness of the dollar, and the productivity of the American workers.

What goes around, comes around. In the end, competition is a good thing, it helps keep us on our toes and creates new opportunities. If there were no outsourcing allowed, American workers would not have had the chance to show that they are better than German workers, and grab that business.

It’s hard to be optimistic when the job outsourced was yours, and I haven’t been in that situation myself. If you did lose a job to outsourcing, I pray you find another, better job soon.

 

[vern_humphrey]

jsk:

I believe you have too little faith in the United States and it’s people. A few years back, I was laid off and had to find another job. I ended up geting a job as an engineer for Recaro Aircraft Seating, a German company opening it’s first U.S. plant, largely to pacify American Airlines, a new and important customer.

Despite the reputation of German excellence, in our first year of operation we were able to beat the established German plants in schedule, cost, and quality. We were ranked ahead of the parent company in quality by both Boeing and American Airlines. We also had better customer service.

I have since left Recaro and returned to my previous job, but Recaro Fort Worth is getting more work because of the weakness of the dollar, and the productivity of the American workers.

What goes around, comes around. In the end, competition is a good thing, it helps keep us on our toes and creates new opportunities. If there were no outsourcing allowed, American workers would not have had the chance to show that they are better than German workers, and grab that business.

It’s hard to be optimistic when the job outsourced was yours, and I haven’t been in that situation myself. If you did lose a job to outsourcing, I pray you find another, better job soon.

Great post.

We have always met the challenge – what we need to do is recognize what the challenge IS, and develop a strategy to meet it.

Yes, compared to the Germans and other Europeans, we are “workaholics.” We’re also more productive, inventive, and prosperous. We’re Americans, and we do things the American way, not the tired old European way.