China's IT output to lead the world by year 2010

http://news.xinhuanet.com ^ | 12-07-04

[discostu]

But last week they said India was going to take over IT by 2025, oh which doom and gloom scenario to believe!

[Bush2000]

There is a significant difference between a line worker in a factory and a software developer.

Nope, I disagree. Indian, Pakistani, and Chinese software developers have seriously undercut Western labor -- to the point where Western companies have already begun to migrate significant amounts of work. If you don't want to become extinct, upgrade your skills now. Bone up on project management, requirements analysis, and software design.

[RockyMtnMan]

Then you don't understand the skills required to perform either function. Some of the most complicated problems in the world can only be solved using computer models. Stamping circuit boards is hardly the skill of a "high-tech" worker.

Software analyisis/design is a function of software development for a vast majority of developers. Project management is nothing more than deciding what your going to do and how long it should take (and estimating cost if that's your role). For the sake of this discussion we'll put aside office politics as a navigable function of a PM.

I've done all of it and still do it today. However, I didn't always do it and I wouldn't be where I am today if I hadn't had the opportunity to move up the ladder.

Trust me, if I become extinct then 98% of everyone on this board performing software development will as well. The remaining 2% will remain employed because of their political skills not their technical talent.

[Bush2000]

Software analyisis/design is a function of software development for a vast majority of developers. Project management is nothing more than deciding what your going to do and how long it should take (and estimating cost if that's your role). For the sake of this discussion we'll put aside office politics as a navigable function of a PM.

I'm not going to quibble over what the average software developer does. I've seen a wide range of skills in developers -- and very few have the full gamut of skills required to define requirements, design/architect, write the code, run the project, and work with customers.

Here's the reality of the situation. Western companies are replacing software developers with cheap labor overseas. They generally hire a Western-based architect/project manager (PM) to oversee the work. Software development has been relegated to churning out code.

You can argue against this reality -- but it's really pointless, since it's already happening right now.

[untenured]

You mean like people living in shacks in the park, like our Great Depression?

Yes, exactly. Tennoji Park in Osaka has been completely overrun by the homeless in the last several years. They now have a huge encampment there, as they do in other big cities. The population has soared in the last ten years.

It's a depression. In 2001 private-sector output was actually lower in Japan than it was in 1991, an amazing event. Well over half of Japan's annual budget now comes from borrowing, even though this kind of spending has been ineffective.

Things are bad there, although various factors there mean the same amount of economic mistery doesn't look as bad to the naked eye as it does here.

[harpseal]

Ping

On or off let me know

[RockyMtnMan]

The reality is they are "throwing the baby out with the bath water". I agree that many "developers" do not have the full range of skills but that doesn't mean they are incapable of developing them. The problem is this, how do you develop the skills if there are no positions of lesser capability available to develop said skills?

This is a catch-22 and needs to be addressed. Are we to develop university programs that develop all of these skills? If so it would require at least 4 years of "residency" much like doctors perform now. Without the opportunity to develop the skills "on-the-job" the higher end positions will not be filled and leave a large hole in a corporations R&D efforts.

We are talking about America's future competitive edge and as much as the "business class" dislikes their engineering counterparts they still need them. We are training the third world in "high-tech" now so expect them to compete with us head on later.

If we were to simply do it all here then the value of our products would dramatically increase. Since our companies are the consumers they only care about cheaper software not the VALUE of developing the software. If we are the only ones that can produce high quality business solutions then we have a monopoly. If we train the third world to produce high quality software then we had better be prepared to forgo any market they want to sell to.

Software can be and is a profitable form of product development and is not always part of a "cost center". Giving away the golden goose (high tech know-how) doesn't seem like a long-term winning strategy.

[Paul Ross]

Yup, just like Japan was going to take over the world 15-20 years ago... NOT!

Uh, pertaining to your evidently biassed interpretation of history...the President's Science Advisory Council Chairman just reported as follows:

The situation is "very, very different" from the one that existed with Japan in the late 1980s and early 1990s, Scalise warned the White House advisory group. "With a small population, Japan reached a saturation point in terms of its ability to take on more of what was going on in the tech world much, much sooner than China will," said Scalise. "It will be a factor of 10 or 15 difference in that regard. So this is going to be a much more prolonged problem to contend with as opposed to Japan."

But an even more important difference is the fact that China has a "cultural tradition" of entrepreneurship, while Japan does not. Because Japan works by management consensus, the country has been unable to topple U.S. high-tech leadership. The United States has successfully out-innovated Japan.

"That is not true with China," said Scalise. "There is a true tradition of entrepreneurial energy in China and we are going to see a lot of companies, a lot of new things, going on there because of that. That is going to be very different."

China has another growing advantage: a very well educated technical workforce. Both China and India are graduating some of the most talented scientists and engineers in the world, Bob Herbold, executive vice president of Microsoft, told the PCAST meeting in a presentation on the future of the science and engineering workforce.

Last year, China graduated 219,600 engineers, representing 39 percent of all bachelor's degrees awarded in the country. By comparison, the United States graduated 59,500 engineers, or 5 percent of all bachelor's degrees (1,253,000). But 58 percent of all degrees awarded last year in China were in engineering and the physical sciences, as compared to 17 percent in the United States (a figure that is dropping by about 1 percent per year).

"We are on the decline in the production of science, technology, engineering and mathematics graduates at the bachelor's level, and the job needs are, in fact, declining equally as fast, if not faster," Herbold told the meeting. "Probably the number-one finding that this group should carry forward and make sure that the President and the White House and the U.S. government and the U.S. citizenry is aware of is the fact that we have a shift here of monumental proportions in terms of jobs and capabilities and competitiveness on the part of other countries to seriously bite into our industrial base," said Herbold in a chilling presentation. "As you stand here and you say, 'Well, what are we going to do about it?' It is not an easy problem...Given all of those statistics, over the short term, it is clear we are going to lose a lot of jobs that are science, technology, engineering and mathematics based. Over the medium term...the only savior here has got to be the incredible innovation capability of this country to create new things because we have seen other industries move out of the country before and it's clear this one [high-tech] is now moving."

Scalise noted that in today's world a comparative advantage has little to do with physical assets such as ports and more to do with human capital -- a "very transportable element," he said. "Therefore, that comparative advantage is fragile and has to be addressed as being a fragile comparative advantage. If it is ignored, then we don't necessarily ever get the advantage from all the work, all the investment that we have been putting in."

Bobbie Kilberg, a PCAST committee member and president of the Northern Virginia Technology Council, relayed a story to the group from a discussion that she had with an executive from a major high-tech firm. He told her that by 2010, 90 percent of his company's R&D, design and manufacturing will be conducted either in China or India. "I said, 'Well, what can we do about that?' And this guy said, 'Not much. We are not coming back. Unless the government prohibits us from going, we are gone,' " Kilberg said. Tax incentives would not keep his company in the United States and there is little the United States can do to compete with low-cost and highly trained labor in India and China. "I was really at a loss when this fellow said that the tax policy is not going to make any difference and that labor is better educated and cheaper," said Kilberg. "How you deal with that is a real key challenge."

Former National Science Foundation director Erich Bloch and MIT president Charles Vest both called Scalise's presentation "disconcerting."

Ralph Gomery, president of the Alfred P. Sloan Foundation, said: "I don't think the federal government can just stand by and watch this happen."

Wayne Clough, president of Georgia Tech, said it is important for PCAST to note the tie-in to the U.S. defense capability. "If we don't mention the 'defense' word and we just focus on economic competitiveness, we probably are missing a piece that we should address," said Clough. He added later: "We need to also remember as we write this report that this transfer of jobs is going on in other sectors as well. We are seeing this happen in any service sector, technical services, engineering, design, accounting -- many other sectors. That is where you really get nervous. How many of these sectors is it really going on in?"

[Bush2000]

The reality is they are "throwing the baby out with the bath water".

True, but this is a reflection of market economics. It's simply less expensive to hire foreign labor to do the same job.

I agree that many "developers" do not have the full range of skills but that doesn't mean they are incapable of developing them. The problem is this, how do you develop the skills if there are no positions of lesser capability available to develop said skills?

Yes, this is a problem. Which is why people need to anticipate this market shift now and react by building up their skills.

This is a catch-22 and needs to be addressed. Are we to develop university programs that develop all of these skills?

There are graduate programs that focus almost exclusively on these skills. I would argue that that is the appropriate place to develop them.

If so it would require at least 4 years of "residency" much like doctors perform now. Without the opportunity to develop the skills "on-the-job" the higher end positions will not be filled and leave a large hole in a corporations R&D efforts.

Agreed -- and the scarcity of candidates is precisely what will make those higher end positions so lucrative.

We are talking about America's future competitive edge and as much as the "business class" dislikes their engineering counterparts they still need them. We are training the third world in "high-tech" now so expect them to compete with us head on later.

Yes, this is short-sighted -- but what else do you expect from pointy-headed management types? They're all about the short term buck.

If we were to simply do it all here then the value of our products would dramatically increase. Since our companies are the consumers they only care about cheaper software not the VALUE of developing the software. If we are the only ones that can produce high quality business solutions then we have a monopoly. If we train the third world to produce high quality software then we had better be prepared to forgo any market they want to sell to.

I agree.

Software can be and is a profitable form of product development and is not always part of a "cost center". Giving away the golden goose (high tech know-how) doesn't seem like a long-term winning strategy.

Again, I agree -- and this is one of the reasons why I oppose open source. It hands over our IP to Third World countries that couldn't develop it on their own.

[Centurion2000]

Actually I think that china is going to get too bog for it's britches and try to knock out Taiwan or Siberia in the next few years ... then someone is going to nuke them back to the stone age.

Competition eliminated.

[Captiva]

Their banking system will probably collapse first. That should slow them down a bit.

And someday those 1,000,000,000 farmers may pick up their pitch forks and kick some commie booty. That might slow them down, too.