Friday, December 12, 2003

Last Sunday, the Times printed up a dialogue on the impact of outsourcing, featuring this interesting comment, from the director of something called the "Center for Digital Strategies" at Dartmouth:

Out in the Bay Area there are plenty of folks who would love to create a little bit of protectionism around their I.T. jobs, but we are far better off letting a lot of those jobs go. Low-skill jobs like coding are moving offshore and what's left in their place are more advanced project management jobs.

And people wonder why so much software is riddled with security holes. I get the feeling this guy judges what's "low skilled" solely by whether or not someone in an LDC will take money for pretending to do the job -- never mind how well they can do it. Something to think about, with industry experts calling bad code (from one vendor in particular, but also bad code generally) a threat to national security. And I'm not even talking sabotage here -- though if you're the Chinese government, and you could do that sort of thing, why wouldn't you?

The same dialog featured this comment, from McKinsey's research director:

There is an assumption by protectionists that these jobs are going somewhere else, and all this money has been pocketed by C.E.O.'s who take it home. A little more sophisticated version is: It's being pocketed by companies in the form of profits. One step further and you say those profits are either going to go as returns to the investors in those companies, or they're going to go into new investment by those companies. Those savings enable me, if I am an investor, to consume more and therefore contribute to job recreation, and if I am a company, to re-invest and create jobs.

And the investors are buying more goods as well. Which is all great for American workers. Unless they're buying goods made in China, and investing in business which are creating new jobs entirely in China.

Of course, another well-covered reason for the lack of job growth in the US, even in the face of rising GDP is that productivity is increasing. Or something like that; another article in Sunday's times describes employers refusing to hire even in the face of increasing demand -- one economist actually talks about employers "trying to squeeze every ounce they can from their existing employees before they give in to hiring". Oh, boy -- "giving in" to creating jobs. We can't have that.

Which actually raises an interesting question that's been in the back of my mind for a while about the dramatic rise in reported American productivity over the past few years -- how much of it is due to companies following WalMart's leadership in forcing the workforce to work unpaid and unreported hours? A little of that goes an awfully long way...


Post a Comment

Subscribe to Post Comments [Atom]

<< Home