Outsourcing Evolving 270
Shree writes "An article at NYTimes suggests that the outsourcing mantra is shifting to reasons of hiring global talent, tapping new potential minds and amassing top global human resources. Its not just software companies trying to save a buck by outsourcing; now its about Berkely trying to hookup with Tsinghua University and institutes in India, and companies like IBM and Microsoft looking to setup R&D labs in Asia."
Re:And people wonder why. (Score:5, Interesting)
24 hour development (Score:2, Interesting)
Besides, there is also the financial benefits of cheap labour that outsourcing brings. Some might say that outsourcing isn't nice to those working at home base, but that's beside the point to a company when deadlines and audits are looming.
Re:I've been thinking... (Score:5, Interesting)
Younger Americans are really caught between a rock and a hard place now. Renting is one of the worst financial moves you can make(the others being credit cards and interest only adjustable rate mortgages). Even if your home doesn't increase in value you are still better off owning than renting, because every month instead of paying a landlord, you are paying a bit to a bank and the rest to yourself. And by the time you totally pay off your home, you don't have to pay a monthly fee to anyone(well, perhaps the government
The problem for people who got to the game too late to get a house cheap is that it's almost impossible for us to own homes. First and foremost you have the cost: Home prices AND rents have been spiraling ever higher, but wages have not. So while we are making money, what little we can save after paying outrageous rents hardly makes a dent in the downpayment we would have to pony up just to get a mortgage at a reasonable rate.
The second of course is job security. Owning a house doesn't make any sense if you aren't going to be in the area more than 5 years, but how many of us here can say they have a job secured in their area for that long? If you sell it before is up, all the interest and fees would have made it hardly worthwhile....
I see the US becoming more and more like places such as Italy and Japan where kids live with their parents till they are married, and maybe even a bit after that. When I was working in Japan, my co-worker was a 30-something graduate of the University of Tokyo making good money, but he still lived with his parents? Why? Because he could actually afford a decent lifestyle that way(such as owning a car!) As much as people like to make fun of nerds living in their parent's basement, if I wasn't in Germany right now and could find a job close to my mom's house, I would live in her basement for a while. It's getting harder and harder not to....
I could not say it any better. (Score:3, Interesting)
Yes, I went to college, and yes, I graduated. However, I have no formal education whatsover in the I.T. industry. The field in which I got my degree was made obsolete by all of the "Free Trade" Agreements. Even though I have no formal education in I.T., I do write code for a living and have taught college graduates in the I.T. field many things. I have also fixed the mistakes of many college graduates and yet, it is the college graduates in the field who get the credit as well as the money for the work I have done. I do not resent college graduates nor do I believe that their knowlege is necessarily any less than mine. I have worked with many smart people who have graduated college and was impressed with the knowlege and skills. However, I have worked with many just as smart people who have learned their profession on their own.
I am 38 years old, and I can definitely see why high school graduates may have second thoughts about attending college. If I had to depend on student loans in order to make it through college, I would not go. There are many people who are finding themselves to be outsourced before they have paid back even half of their student loans!!! In the Police States of Amerika, we have governments that work against small businesses as well as employees. We need to quit voting for Democrats and Republicans (in America). Both are EQUALLY GUILTY for the decline America is currently experiencing. People in other nations should also discard candidate in the top known political parties in their respectiver nations. The top parties in each nation usually have their campaigns financed in one way or another by the top money. Top money is what these lawmakers end up working for. It is time to change that, one way or ANOTHER!!!!
My message to Phillipeanos and Indians is that I do not doubt your capabilities or your smarts, or your willingnes to work. There are good, bad, ugly, pretty, smart, and stupid people in every country in every part of the world. From the media such as newspapers, TV news outlets and other places, you have most likely heard that most Americans are stupid, lazy, do not care about a thing, and live lives of luxury. This could be further from the truth! Most of my fellow Americans work two jobs just to make ends meet. Right now Indians and Phillipeanos may be experiencing an economic boom, but I guarantee that the outsourcing of your jobs is coming within the next few years. When the multinational cartels find other smart people that they can exploit for a cheaper price, then that is what they will do. You and your families be damned as far as they are concerned. The executives will then claim that they cannot find "qualified" people in India or the Phillipeans and are "foced" to look elsewhere. This is what happens when what is called "money" has it value arbitrarily set. When small time money printers print money, it is called "counterfeiting." When governments or Federal Reserve banks do it, it is called "Monitary Policy." The paper based currencies of most nations are backed by nothing, so the real value of this currency is almost nil. Talk about the blind faith of the religionists around the world. There is more blind faith being demonstrated on payday than any other day of the week.
Re:Blasting the Indians (Score:1, Interesting)
Even the teachers have really started to notice this. The work ethic from my American peers was just pathetic and instead of putting in hard work and learning as much as possible, they would rather go to the clubs, get drunk and high and listen to latest idiotic 50 Cent album. The vast majority of the foreign student simply had a far better work ethic and were willing to work a lot harder to become better in their respective field. A major problem right now in the U.S. is that we're harvesting a culture that doesn't promote hard work. If you can't see that, simply ask a professor at any major University campus in the United States what he thinks.
In all my years of study, I only met a handful of students that I would consider hard workers that really started to master their field. Unfortunately for us, the vast majority of them were not native to the United States. We're producing a culture of lazy idiots who are incapable of critical thinking and we need to start making serious changes or there is simply no reason that companies are going to choose American workers over foreign ones. It's time to stop blaming everyone else and to start looking internally at our culture and our incredibly low scores when it comes to science, math etc. If we want to compete globally we need to give companies reasons to hire us over others, it's as simple as that and right now we're not doing that.
P.S. And yes, there are plenty of Americans that are not like this, however they're in the minority and if we don't want this image of lazy dumbass Americans being portrayed all over the world we need to make the hard workers the majority.
Economic fundamentals (Score:3, Interesting)
First off, if you look at the infrsatructure of these countries, they are very small compaired to the size of infrastructure in the western world. Which I'm sure they will catch up, but infrastructure is expensive and the US has over 100 years up on them.
Second off, if you look at the political freedom rankings of these countries, many of them are in really bad shape. This is very important, because countries with political freedoms have outlets for the stress cuased by growth and change. China especially, could be explosive.
Third off, if you look at the economic freedom rankings of these countries. They are also in really bad shape. This is extremely important, because economic freedom allows peoples to exploit opportunities to create wealth and prosperity. I could really see a situation where all these cool technologies get developed all over the world, but they only get applied in productive ways in the free and western countries. In China, general tax rates are as high as 40%. (The US is pretty bad too, but already has a middle class(for now)) But there is no way that you can have high rates of sustained growth under those kind of taxes, because there is no way to build an economic middle class.
Fourth off, IMHO the economic shithole that the US is in is temporary. Currently the US has more debt than it can ever pay off, and is about ready to fall off a hyperinflationary debt cliff. However, once the financial system collapses, and they push the reset button, the path will be cleared for sustained growth. Half the government freebies will be dead, realestate will collapse and become reasonably priced, the debt will be offloaded, the currency will likely end up backed by something other than the good faith of the federal government, and taxes will be low. That combined with the higher level of economic and political freedoms will position the US very nicely. Hopefully, the US will also open the immigration flood gates, bringing intellignet people over here who will even create more jobs and oppertunity - getting more bang for the buck.
Like it or not, this is Phase 2. (Score:3, Interesting)
Outsourcing scientific research is just the next step. Science and technical students here are freaked out about living a life of perpetual unemployment. I graduated in the late 90s, and even then having a science or engineering degree was considered at least a step in the right direction. We laughed at all the psychology and businsess majors who treated school as a 4 or 5 year party and said they'd never get jobs. Now it seems like they have the upper hand in management, which I think is probably the nnly "safe" job. I can understand why students entering college today wouldn't want to study math, science or engineering, simply because they know they won't be able to make a living in the future. Either that, or their business student peers will be making 4 or 5 times their salary in a management job. Now companies can't find talent here, so they outsource to somewhere that has a higher work ethic and much lower salary. Double bonus for them, big loss for those of us who are scientific and not destined for the ranks of management.
Unfortunately, I don't see anything short of a decree from the top that will stop this. Even then I have my doubts. Imagine if the president got on TV and told everyone that we're losing our competitive edge by becoming a nation of service workers and manageers. I don't know if anyone would listen.
We need a big-time project like the Apollo missions in the 60s to get everyone believing we can actually compete again, and then maybe the trend will reverse itself.
you got it backwards (Score:3, Interesting)
You're making the fundamentally wrong assumption that outsourcing at the level discussed in the article is driven by cost. IBM and Microsoft are going to India not because it's too expensive for them to hire Indians and move them to the US, but because it's becoming too difficult (in a way that no amount of money can fix).
Dismantling the US safety net even further is only going to accelerate outsourcing: the more brutal and socially irresponsible the US appears, the less attractive it is to many immigrants. In particular, highly-skilled immigrants coming to the US don't want to have to have a business degree in order to figure out health care or retirement.
In any case, you seem to think that not requiring health care benefits or retirement somehow saves money; it doesn't. Those services still need to be paid for, and if they aren't paid for by companies, they need to raise salaries so that employees can pay for them. Of course, at the low end, companies may use lack of such requirements as a means of cutting salaries, but they are simply cost-shifting: since we generally don't let people die in the streets, health care then ends up being paid through taxes, at a premium rate.
Granted, I think employer-supported health care is broken, but not for the reasons you likely would agree with; what we really need is tax-payer funded universal health care.
Re:whatever they say... (Score:3, Interesting)
The one thing I've never heard an argument against is this line of thought (stick with it - there are a few steps but it's worth it):
Incidentally, has anybody else noticed fewer stories about offshoring these days? I think it's biting the market less than it used to - and I speak as a member of management as well as an engineer. The reasons my company doesn't offshore include:
I want to be able to say: "Dan! Can you run those stress tests again please?" to the guy next to me. Despite the fact it's not really his job, he is a friend who will do that for me. I really can't afford to explain why we need them to some guy half way around the World who says it's not his job and that I must talk to his manager.
If corporations really wanted to save money, they'd have offshored middle management years ago.
Having said that, I think R&D will be offshored, I think large projects will be offshored and I think major mutlinationals will offshore by default. However, most IT projects are not R&D, are done by 10 developers or less and done at companies that are not major multinationals.