Posted on 08/07/2003 5:25:07 AM PDT by Non-Sequitur
Hundreds of Sprint Corp. employees may lose their jobs as the Overland Park-based telecommunications giant moves forward with a plan to send certain technology jobs overseas.
Sprint chairman and chief executive Gary Forsee on Wednesday said competitive pressures had forced the company toward "offshoring" -- the growing trend of U.S. companies relying on lower-paid computer programmers as far away as India and China.
Sprint put out a request for proposals from outsourcing companies earlier this year and has since narrowed the list to two offshore vendors. Forsee said Sprint is conducting site surveys and is in "serious discussions" with the two companies.
"At the end of the day, it's several hundred jobs that could be impacted," Forsee said. "But we don't know what the ultimate result is."
A final decision on how to handle sending the jobs overseas is likely within 60 days.
Layoffs would not be immediate, Forsee said, because moving work to the outsourcing companies could take six to 12 months.
Forsee also said the company hopes to ease the impact of sending jobs overseas by moving some displaced workers to other information technology projects within Sprint and replacing existing contractors with Sprint employees.
Sprint already was considering moving jobs overseas when Forsee replaced William T. Esrey as the company's top executive earlier this year. But Forsee said he made the final decision to go ahead with the request for proposals.
Sprint already uses an offshore company for some customer service jobs. The company has outsourced information technology jobs to U.S. firms for years. But it has resisted sending information technology jobs overseas.
That has changed as Sprint, like other telecommunications companies, struggles with weak sales in what continues to be a difficult economy.
For almost two years, Sprint has been on a campaign to lower costs to compensate for soft sales. Since October 2001, more than 18,000 jobs have been eliminated. Hundreds of contractors also have lost work at Sprint.
Computer programmers and other skilled technology workers have been among the hardest hit, and there remains a severe shortage of available technology jobs in Kansas City and elsewhere.
Sprint's move toward sending jobs overseas will make a bad situation worse, said Rick Kumar, a former Sprint contractor who last year founded a support group for laid off information technology workers.
"The market is where it was a year and a half ago," Kumar said.
Many people still are out of work or have abandoned their information technology careers for other work, Kumar said. But unlike many of his information technology colleagues, Kumar said he does not blame Sprint and the many other companies that have turned to cheaper labor overseas.
"They have to follow the model or go out of business," Kumar said.
That is precisely how Sprint explains its move toward an offshore vendor. When competitors began cutting information technology costs by turning to offshore programmers, company officials said, Sprint was forced to look at following suit.
"We've got to stay on top of our competitive position," Forsee said. Offshoring "has become a significant trend that we hadn't participated in, so we looked at that as a strategy that was important...because of the competitive aspects."
IBM, Microsoft and HP are among the U.S. companies that are sending information technology jobs overseas or reportedly plan to start. Sprint must lower its cost to keep pace, Forsee said. But he knows careers are at stake.
"When you take actions like that, you're doing that hoping to keep the company as a whole strong," realizing that there are "people and careers and jobs at stake," Forsee said. "We try to do that part very carefully. It's not without significant consideration."
Shares of FON closed Wednesday at $14.05, up 1 cent. PCS closed at $5.41, down 36 cents.
Now what makes you think China will finaly decrease its protective tariffs have the suddenly become a benevolent republic or are they likely to be in the near future? I was unaware of the end of the Communist Party's strnglehold on power please give a reference so we all may learn. Was there a revolution we all missed?
These are really not difficult concepts levying imposts and duties is one of thepowers specifically granted to Conbgress in Article I of the US Constitution. The US Constitution is the Supreme Law f the land remember.
Why on earth would anyone wish to limit technology when that technology is the key to boosting productivity everywhere.
What I propose is stopping government subsidies and currency controls a temporary limited tariff to maintain or IT industry. manufacturing and other tariffs to maintain a certain level of industry and to use as bargaining chips to lower tariffs levied by other nations on American exports, balance foreign subsidies, and as bargaining chips to remove foreign non-tariff barriers.
Your argument depends on making the unsubstantiated assumption that everyone is doing the same thing as Sprint, or that the current market is uncompetitive. (which may be the case but is still an unwarranted claim)
Quick quiz: Why did Bush slap a tariff on imported steel, and what did domestic steel producers do in response?
Very good question. It has harmed the industry, by some estimates has caused 200,000 job losses as dependant industries must cope with no longer being competitive. Those refigerators made here now cost more because the steel costs more. They could have passed on their costs if tariffs on imported refrigerators was also raised, but that is not an argument against tariffs per se, but against government's capricious hand interfering with the free markets. The pre-Lincoln's War South suffered under this asymmetrical approach to tariffs. The North imposed massive tariffs on European goods making it more expensive for the south to mechanize (thus elevating the need for more cheap imported manual labor), yet they did not allow the South to raise tariffs on cotton and agricultural products. Europe, in response to the tariffs shafted the South too by slapping a tariff on American agricultural products. In a way, one can argue that Lincoln tried to start a civil war by punishing the South and rewarding the North.
What "W" did was the same thing Lincoln did. Because Bush wanted to appease a bunch of union rats who wouldn't vote for him anyway, he clobbered industries that depend on steel.
The argument for doing this to steel was that the national security was at stake because without the protective tariffs the US steel industry couldn't compete. This is pure Bravo Sierra because the military doesn't use the same pig iron that the civilian market uses. If Bush really wanted to do something for the steel industry, and not just for the manufacturers and the laborers, but for even the dependant manufacturers of steel products - he could have scuttled that $#%@#$# EPA Clean Air Act and could have reduced the environmental, OSHA, DoE, etc. regulations that are really responsible for the US's inability to compete.
But he didn't do that. He applied a fatal asymmetrical tariff. If the tariff was against all steel and steel products (based on some relevant formula) then the imported refrigerators would also be more expensive. But that expense would be like a sales tax and one lunatic fringe branch of the Libertine Party is orgasmic about a NRST. So that would be kewl, right?
Curious though, the argument for the steel tariff being a military strategery thing, is actually the argument that the military makes for software and telecom. But of course we are exporting software and telecom regardless of the Clear and Present Danger this brings.
The stated reson was because the American steel industry was facing dimping by foreign steel producers.
Quick quiz back when was the first protective tariff enacted in the USA and who was the President who negotiated an end to American protective tariffs prior to GWB imposing the steel tariff.
We aren't talking about "companies", we are talking specifically about Sprint. Sprint has enormous amounts of assets and an extremely valuable client list that they just won't "walk away from".
I am sure as hell glad that you are miles away from a corporate board-room. Your ability to innocently produce logical fallacy after logical fallacy to support Free-Traitor sedition is shocking in its gall.
I just did it as a good policy against any calamity. Debt free now for over a decade.
I have seen other studies that directly contradict this study. Now as to the Steel tariff and its effect on tthe appliance industry Steel is a very minor component in terms of cost of most electrical appliances and as such would not be a significant factor in any decision to offshore those industries. Automobiles would be a far more likely candidate for this if the steel tariff directly affected this but remember the Steel tariff was imposed because some foreign entities were selling steel for a lower prioice in the USA than in their own nations.
If those assets and those clients aren't generating enough revenue to make the effort profitable, and Sprint can't decrease costs enough to make the effort profitable, yes, they *will* shut down that particular business unit.
I am sure as hell glad that you are miles away from a corporate board-room.
Companies need to make profits.
If the company does not make a profit, it eventually goes bankrupt.
If the company finds that a business unit is not profitable, cannot be made profitable, and does not drag along enough profitable business or generate enough of a tax shelter to justify its losses, then they can either shut down that business unit or eventually go bankrupt.
Yeah, people like me were kept miles away from corporate boardrooms, such as Global Crossing's boardroom, Enron's boardroom, Tyco's boardroom...
Which rather neatly explains what happened to Global Crossing, Enron, and Tyco, among others.
Your ability to innocently produce logical fallacy after logical fallacy to support Free-Traitor sedition is shocking in its gall.
"Sedition?"
Disagreement with your typed-out verbal flatulence is now "sedition?"
You've jumped the shark, dude.
True anbd property rights were recognized in most nations. What is your point?
LOL. Tell me when you find that. There are so many laws it is impossible to know them let alone comply with them. When a person can never be sure if his actions are legal or illegal this the very opposite of the rule of law.
You are straying off topic. i said I prefer teh US Constitution not the anarchy proposed by Bastiat and you religion.
Many of the revolutionaries, such as Patrick Henry, denounced the Constitution. They knew it would lead to an unlimited, intrusive government. Has this very thing not come to pass? And here's the real kicker: Unlimited, unaccountable, centralized government was the very intent of the Founding Lawyers who bitterly opposed the Bill of Rights and then when forced by the States to accept them, deliberately sabotaged the language.
You really really should consider psychotropic medication. The argument against teh Bill of Rights was made by Alexander Hamilton in the Federalist papers but your oppositrion to tariffs which are essential to maintaining an economy that will susutain teh USA implies an opposition to individual rights. Your desirte for religous purity in what you concieve of as property rights leads to teh support of Slavery first in China then here as any revolution causes at least some such slavery. Revolution is the naturaloutgrowth of your stand and perhaps I should look forward to that but I ahve seen wars up close and personal and I do not wish to see taht in my nation. I want a prosperous USA if evenif does not conform to your prophit's false vision. I note the states ratified teh Bill of Rights and your discussion of sabotage does not conform to the Historical record. You really really should get a grounding in reality. this fantasy world you are libing in will destroy you and make you absolutely unable to function.
The only assumption I've made is that all companies in the domestic market would try to maximize profits. But if the market is pseudo-competitive as you suggest, then what happens when the low-cost producer starts to squeeze the other ones? You've already slapped a tariff on the foreign producers, what now? A tariff on the low-cost producer? After all, JOBS ARE AT STAKE!
It has something to do with the economic law of exploiting comparative advantage. As long as there is reliable free trade system, it works well. It will maximize the size of the American economic pie. But no doubt about it, in this environment, those will a low level of skills will see their relative wages sink.
In the end, economic forces are so strong, that no political policy can really deflect them very much. One can bitch and complain, but the die is cast. That is even more true, when goods can be exported via the internet. No government can stop that.
What our great land really needs to do is reform our suck secondary public educational system, root and branch. Absent that, the cohort of the economically marginal in the US as a percentage of the work force will slowly increase.
Germany allowed its secondary public school system to go down the tubes, and the place is in a long term secular economic decline. Watch for Taiwan and such places to pass it in the next 20 years. Germany at the rate it is going, will end up with a standard of living somewhat along the lines of maybe Russia by then. You heard it here first.
As a LCPL in the Marine Corps, my son was better armed and at greater risk than the average PD or FD employee. He certainly doesn't draw that level of pay. The good news is that he's making 3X as much as an Indian programmer as an employee of In-and-Out Burger. He is giving serious thought about whether his pursuit of a degree in astrophysics still makes sense.
Which of the founding fathers do you try to channel? I get the feeling your camp got somehow exiled from the drafting.
Your very old and considered opinions are valuable to me. We may be undergoing a TRUE 'paradigm shift' that our fathers couldn't see, couldn't predict. Except for Washington, who advised against meddling internationally.
A democracy, if we can keep it?
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