White-Collar Exodus

ABC News ^ | July 29, 2003 | Betsy Stark

[RockyMtnMan]

Michael Emmons thought he knew how to keep a job as a software programmer.

"You have to continue to keep yourself up to speed," he said. "If you don't, you'll get washed out."

Up to speed or not, Emmons wound up being "washed out" anyway. Last summer, he moved his family from California to Florida for the Siemens Co., makers of electronics and equipment for industries. Not long after, Emmons and 19 other programmers were replaced by cheaper foreign workers.

Adding insult to injury, Emmons and the others had to train their replacements.

"It was the most demoralizing thing I've ever been through," he told ABCNEWS. "After spending all this time in this industry and working to keep my skills up-to-date, I had to now teach foreign workers how to do my job so they could lay me off."

Just as millions of American manufacturing jobs were lost in the 1980s and 1990s, today white-collar American jobs are disappearing. Foreign nationals on special work visas are filling some positions but most jobs are simply contracted out overseas.

"The train has left the station, the cows have left the barn, the toothpaste is out of the tube," said John McCarthy, director of research at Forrester Research, who has studied the exodus of white-collar jobs overseas. "However you want to talk about it, you're not going to turn the tide on this in the same way we couldn't turn the tide on the manufacturing shift."

India Calling

Almost 500,000 white-collar American jobs have already found their way offshore, to the Philippines, Malaysia and China. Russia and Eastern Europe are expected to be next. But no country has captured more American jobs than India.

In Bangalore, India, reservation agents are booking flights for Delta; Indian accountants are preparing tax returns for Ernst & Young; and Indian software engineers are developing new products for Oracle.

They are all working at a fraction of the cost these companies would pay American workers.

For example, American computer programmers earn about $60,000, while their Indian counterparts only make $6,000.

"It's about cost savings," said Atul Vashistha, CEO of NeoIT, a California-based consulting company that advises American firms interested in "offshoring" jobs previously held by Americans. "They need to significantly reduce their cost of doing business and that's why they're coming to us right now."

Vivek Pal, an Indian contractor for technology consulting group Wipro, whose clients include Microsoft, GE, JP Morgan Chase, and Best Buy, is hiring 2,000 Indian workers quarterly to keep up with demand. Pal knows American workers resent the "offshoring" trend but says all Americans will benefit in the long run.

"Globalization — whether it's for products or services — may feel like it hurts, but at the end of the day, it creates economic value all around," said Pal.

At the end of the day, Emmons has a different view: "If you sit at a desk, beware," he said. "Your job is going overseas."

[Lazamataz]

A "doom and gloomer" is now a generalized slam at anyone who dares question, criticize or makes a negative comment about problems in the economy, finance, jobs, etc. There is an obvious effort going on at promoting group think.

Apparantly! Kinda like the groupthink that emerged for a while there, whereinwhich any criticism of GW Bush's policies labeled a person as a DNC plant.

I know that you aren't a doom and gloomer but that is the label you are going to be stuck with unless you either keep your mouth shut about your concerns or cheerlead party politics.

Heck, I've given you a fair amount of s**t on what I perceive is excessive negativity about the economy. Kinda odd that I'm lumped into a category with you for expressing what I believe are geniune and realistic concerns about the options for employment in America in the next decade.

Makes me wonder if you were really wrong after all.

[RnMomof7]

Maybe if you had Agamemnon's degrees you would know enough not to ask such common sense questions as these. I am sure that Agamemnon has all of the answers.

*grin*

[Lazamataz]

Sounds to me as if you have experienced those particular personality problems much more than Laz ever has. Laz has always had a great sense of humor and has been unafraid to express his agreement or disagreement with issues. You, on the other hand, sound very argry and unhappy.

Why thank you, Richard. Yeah, this Agammemnon fellow came out swinging hard. But like the character Cyrano de Bergerac, I parried his attacks with some stinging observations of his character -- similar, it seems, to what you observed about him. :o)

[Lazamataz]

LOL! If Agamemnon's continued business success depends on his people skills, it looks like we'll be seeing him at the unemployment line soon. ;^)

[Lazamataz]

Troublemaking is being offshored.

LOL! That is funny!

[AAABEST]

I wouldn't stop a business from moving anywhere they chose, as long as they follow the law.

The H1Bs and L1s are a corrupt manipulation of our laws to placate certain interests...IOW corrupt. I don't think moving a business or outsourcing should be illegal, that would be insane in a free market. If you want to know the truth the upside to this is that the unions are going to take a bath and we're going to have to become competitive.

That said while I wouldn't want outsourcing to become illegal, I know a company that's about to shift all of it's staff assets overseas, they're setting it up on the QT as we speak. They don't want anyone to know, but I'm going to see to it that EVERYONE knows, they could bite me. They're not going to like me very much after I blow their cover, but that's their problem.

I don't believe in a law for everything, there are lots of ways to handle bad behavior. When that guy shot himself in the parking lot of Bank of America, I closed all my accounts with them the next day after doing business with them for 8 years.

Let me be clear, I love freedom and free markets, even if it costs me hardship and money. I just think business should be conducted legally, fairly and morally. You know, like that Bible thingy says.

[arete]

You know me -- I've never been afraid of being wrong nor have I ever been obsessed with the need to be right.

Remember the story of the three major league umpires who stopped by the Billy Goat Tavern in Chicago. As they were sitting there enjoying their favorite cool beverages, the first umpire says, "I calls 'em as I sees 'em". The second ump says, "Well, I calls 'em as day are". The third ump looks at the first two and just shakes his head and says, "Both youz guys are wrong, cause day ain't nottin til I calls 'em".

Richard W.

[samuel_adams_us]

Hello All:
There is a quote in the Sunday Denver Post by the president of an outsourcing company called Technology Crafters:

“There’s a lot of interest,” said Robert Welch, the company’s president. “American software teams are awesome for innovation, but in terms of being able to crank things out in a productive manner, they’re no the best on the planet.”


I find this quotation completely laughable! What a joke! If the Indian software companies were held to the same high standards that the software companies in the United States are held to, their prices for labor and product would be the same. A good example would be that a customer product takes 10,000 lines of “C” code in order to provide the customer with the amount of functionality they need. The Indian programmer writes the code and the documentation in order to install and use this piece of software. The Indian’s American counterpart writes the 10,000 lines of code, the documentation to support the installation and use of the software and he/she will also write the ISO9001 documentation required to go along with the software product which includes the project planning document, the software design document, the software testing documentation, the architecture review board documentation, etc. As you can see it’s obvious who takes more time to produce their product and who does a more careful and a better job. So just how many Indian software companies are ISO9001 certified? I wonder! American IT management would like their customers to think the quality is the same but underneath it all, we all really know the truth.
Let me relay an actual customer event that took place recently, a large Swiss Bank found an operating system defect on their system while trying to write an application to produce custom graphics for their bank statement printing. The function they found the bug in was wcstombs which converts wide character set strings to multibyte character set strings. Anyway this customer was/is paying for 24 X 7 development support and called into the 1-800 number and talked with a support engineer here in the United States. The customer was told that the engineers where looking at it and that they would be updated every morning until the fix was shipped. The software these days is written in India, it was Friday morning here in the United States, the Indian programmers don’t work weekends or overtime and are not required to be called out even if there is a customer emergency. The support representative from the United States called the customer on Saturday morning, Sunday Morning, Monday morning, always telling the customer that the engineers were working on the fix even though they weren’t. The customer finally received their fix the following Thursday afternoon, thus making the delivery of their bank statements late and costing them a lot of extra money for shipping, etc. Previous to this instance that same software had been written here in the United States, the customer would call in on Friday morning and a real software engineers was working on it within the hour, a test fix was usually supplied before the weekend was out and the customer would have shipped their statements on time. Now if you were that customer, would you be happy with your 24 X 7 development support?
I have one last comment, I find it interesting that a Japanese company named Toyota can produce a superior car with American workers and the CEO only earns 1.5 million dollars a year and an American company named GM pays their CEO 30 million dollars a year, uses foreign labor and produces cars with twice the number of defects per thousand cars shipped. I personally believe that the real problem in this country is the inept management running our companies, they cost more, create more headaches and redtape and then pass the blame down to the engineers and those doing the real work.
When will it stop? Enron continues to go on and on and on, this time the management is pushing the blame on the engineers and replacing them with foreign workers when the real responsibility and problem lies with them, they are the ones who agreed to all the extra work for the products, not the engineers and yet they take no responsibility for their own actions.

[harpseal]

JMO, but John Browning would be saying that although his creation(a firearm) can do harm, his creation does far more good, protecting innocent property and life.

John Browing was alive during the crime wave of the 1920's and during WWI he made no public statements decrying guns.

While Ross Perot stands silent about his creation's(EDS) outsourcing jobs.

Your point is I am sorry but your post is absolutely inchoherent and it makes no sense either historically or to the point of this thread. Ross Perot's statements are irrelevant to the question of what should be the proper response of government to the disaster it has created by meddling in Free Markets in teh name of the current anti-American Internationalist trade structure.

[RnMomof7]

The H1Bs and L1s are a corrupt manipulation of our laws to placate certain interests...IOW corrupt. I don't think moving a business or outsourcing should be illegal, that would be insane in a free market. I

LOL Somehow I knew that would be your answer .

AA live with the fact that as long as all manufacturing is outsourced and as long as the lower level tech jobs are being outsourced , I think it is the most moral thing to allow those companies that stay in this country to seek the cheapest labor available, be that illegal immigrants or imported engineers. That is the free market and was an original part of the NAFTA accord that you all hailed.

You only believe the imported labor is "corruption" because it may impact YOU

Get in line , the US Government has been screwing American workers for almost ten years..it just happens to be your turn now

As for the unions..that is an old fashioned red herring

All those banking jobs and accounting jobs and the jobs at Dell or HP that are now in India were not Union jobs.

I go back to my original observation.

It is acceptable for the out of work union worker to have to sell apples on street corners if necessity as long as you can drive your Lexas

Those days are gone AA There will be little interest among those displaced men to support your cause.Now it is their turn to say "Let them eat cake"

[RnMomof7]

LOL! If Agamemnon's continued business success depends on his people skills, it looks like we'll be seeing him at the unemployment line soon. ;^)

If he needs customers here in the states his days are numbered anyway

[RJS1950]

Sure thing, BUT, if everyone retrained to these fields, the supply would far outstrip the demand. In addition, the workers (and not just IT) who are being displaced are usually older and the drop in income over the period of years it takes to become certified through apprentice and journeyman would be a huge hit on the economy. It takes quite a number of years to become an experienced craftsman making $65,000+ and by the way the average IT pay in this country is around 65K and that after a number of years of experience. Besides that, many trades and skilled crafts jobs are being filled by immigrants and illegals (the unions and their dem buddies look at it as a pool of pliable, easy to lead dem voters). Meanwhile, the displaced workers, many of whom retrained from manufacturing jobs because IT was the upcoming burning need of american commerce are left floundering, with little prospects, age discrimination and no money with which to continue to fuel the economy based on the products and services the companies that laid them off sell. Hope the corporate weasels can convince the Indian Chinese and Mexican populace to buy their expensive goods, because before long they will kill their markets in the U.S. Finally, before you write me off as another whining, unemployed IT guy, I did work in IT for 9+ years after a military career. But I saw where things were going and being 50+ I was not going to get caught in the blatant age, sex and preference for offshoring discrimination that was/is going on. I made a jump to an administrative position in academia, with a sizeable cut in pay. It pays less, but in the position I and many others are in, it made sense. Besides, with the background, training/education and very varied experience I have, I could have retrained to anything from skilled trade to a business concern and threatened your job or found a way to put you out of business in favor of my own. There are a lot of us out here and if we all decide to retrain/reinvent ourselves into the same areas you are in, you are going to be very threatened indeed.

[SauronOfMordor]

Don't spend you time pitying me until you make $300K a year in his own business like I do.

In 2001, I made 300K. In 2002, it was a different story. Shit happens, and things change. Some years you find yourself Master of the Universe, other times things are not so good.

[AAABEST]

It is more complex than mere greed.

I agree with almost everything in your post. I don't have a prob with businesses finding a good deal and getting the cheapest labor possible. Where I draw the line is manipulation of our immigration laws (H1bs and L1s) and exploiting people as is the case when you use a person to train someone for their own job without telling them. It's a morality and legal issue with me.

Everything you said about regulation et al is spot on.

[Lazamataz]

Hey Southack! Come over here and check out this Agamemnon character, and my responses to him.

You're an example of a very successful small business owner who I hope continues to succeed. That's because you are a humble and caring individual who gives a s**t what happens to people other than himself.

Agamemnon is the opposite of you, characterwise.

[SauronOfMordor]

Unless the rich will advance the class warfare to the formal or informal coup establishing Latin American style oligarchy, the regular people will vote for some Socialist redistribution and get the goodies without bying them.

The problem is that the South American model and socialism are both oligarchies, the only difference being that the South Americans are open about it, while the socialist Nomenklatura hide behind the facade. In both cases, the "connected" are wealthy, and the regular people are poor.

[Agamemnon]

You flatter yourself too much. Also, I am not much impressed with a self-employed self-appointed CEO who only makes 6 figures. When you get it up to around 10 give me a call.

Sniff at 6-figures all you like. I'm not particularly concerned by what you happen to find yourself to be "much impressed" with, actually. I doubt it would interest me. Suffice it to say, if what impresses you is founded in the same envious little metrics Laz and a few others have, I couldn't be less impressed with your sense of proportion or with your debating skills.

Actually, if you look back in the thread, Laz foolishly attempted to insult my own career accomplishments, thinking he could put me under the table (without knowing them of course -- a sure sign of a poorly prepared debater and loser who has a penchant for stretching his arguments beyong the scope of credibility). Of course, he just stepped into the mess he created in his own diaper.

"Green" is an unattractive color for either of you. Learn to become the CEO of yourself before you fall into the same trap of jealousy Laz can't seem to pull himself out of.

[SauronOfMordor]

In my business, I am the CEO and chief biochemist, Principal consultant, and head of business development. Who says a CEO doesn't add value, and generally invents nothing? I AM the value and the product sought by my clients.

Just never lose sight of the fact that somewhere in Asia is somebody who is just as good at biochemistry as you, and a lot hungrier

[AAABEST]

You're misrepresenting my position. Are you sure you're not my wife? OK I'm sorry I called Michelle Malkin hot.

Let me straighten out a bunch of stuff you ascribed to me that is not true. I didn't hail NAFTA although if done properly, free trade is the only possible answer. I don't believe imported labor is corruption, but changing immigration laws to placate special interests is. This doesn't impact very much at all and it's not my "cause" because I'm self employed and I don't drive a Lexus.

Now that I've cleared all that up I've forgotten what we were talking about.

[jpl]

Read somewhere (Time mag??) that 4 out of 5 Corporations contemplating doing this "don't give a D#mn" about "public backlash."

In eighteen months, when Howard Dean or Dick Gephardt is President and the Democrats have retaken control of the House and Senate, a lot of these businesses will be singing a different tune, and the Stupid Party will be left once again scratching its head and wondering what on earth happened.