I find it rather ironic that so many people in America, the land of capitalism, hate outsourcing so much. This is simple economics right out of Adam Smith. People in India can do the same things as people here in the States, and at a significantly lower price. Therefore, they get the jobs, and rightfully so. One good benefit for Americans is that this allows their employers to use that money elsewhere. And yeah, IT job salaries might fall, and some people might have find jobs outside the IT field. But for t
You obviously don't know crap about economic theory. Free trade relies on the idea of comparative advantage, that one place is inherently better at doing something than another. When Indian programmers are just as good as American programmers and there's no transport cost (facilitated by internet transmission of code), then it really is a race to the bottom to see who can pay the least for the samee service. There's no advantage to hiring US programmers, so it goes to India! In short, we're screwed! And, as
A competitive advantage is all about value. Can you produce a better product, and for how much? The reason that Japenese did so well in the auto markets is that they not only produced BETTER cars, but did it for less.
In this case India is showing that they have a competitive advantage in programming. They can produce code at the required level and do it for FAR less than the American programmer.
It is not, however, a race to the bottom. The Indian salary will not remain static. As the number of jobs and th
We talk about how these theories are untested, well we've seen the results of this same phenemenon in auto manufacturing. After all, remember all of those car building jobs we 'lost' two decades ago? Well, they're coming back in droves.
You obviously don't live in southeast Michigan. Michigan has one of the highest (and still going up!) unemployment rates in the country right now. Our manufacturing base (centered on the auto industry around Detroit), which has been trickling out in fits and spurts for 20-30 years now, has been clobbered the last few years. If auto industry jobs are "coming back in droves" they're certainly not coming home to the Detroit area.
As an aside, this isn't just affecting manufacturing here. My brother-in-law works for Ford accounting. They sent 70-80% of the positions in his department to India (accountants, etc.) keeping only the highest skilled and most critical positions in the US filled by USians. They eliminated something like 40 or 50 decent paying white collar jobs in his department alone.
Actually the returning jobs aren't going to detroit, they are going to mississippi and kentucky, because they are cheeper places to live. But the irony is that most "Japanese" cars are assembled in the US now because they found that is was cheeper than manufacturing them in Japan. Of course the parts of the car come from all over the world, just like American cars, but much of the assembling is done here.
Yes, auto jobs that are coming back are going to Mississippi and Kentucky, not only because they are cheaper places to live (they are somewhat cheaper), but also because wages are much lower and unions are non-existant or very weak. This is another example of race-to-the-bottom in our own country.
IIRC, the Germans refer to the US South as "our Mexico."
So my question to you "race-to-bottom" types... Why are we much better off at the end of the 20th century than the beginning? You'd think if we were "racing" anywhere, we'd be there by now, given generations of industry.
When 97% of U.S. "poor" have a color TV, I don't consider us very poor. Yes, I am a subscriber to Easterbrook's world view.
Toyota has plants all over the US, just not in Detroit: toyota us plants [toyota.com]. I know Honda has at least a few plants in the US (and Canada) probably many more than that as do most other Japanese Auto manufacturers. I think the parent post was referring to Japanese companies building in the US not US companies getting business back from the Japanese companies.
Whenever a system becomes completely defined, some damn fool discovers
something which either abolishes the system or expands it beyond recognition.
Outsourcing is a good thing... (Score:5, Insightful)
Re:Outsourcing is a good thing... (Score:5, Informative)
Re:Outsourcing is a good thing... (Score:5, Insightful)
In this case India is showing that they have a competitive advantage in programming. They can produce code at the required level and do it for FAR less than the American programmer.
It is not, however, a race to the bottom. The Indian salary will not remain static. As the number of jobs and th
Re:Outsourcing is a good thing... (Score:2)
You obviously don't live in southeast Michigan. Michigan has one of the highest (and still going up!) unemployment rates in the country right now. Our manufacturing base (centered on the auto industry around Detroit), which has been trickling out in fits and spurts for 20-30 years now, has been clobbered the last few years. If auto industry jobs are "coming back in droves" they're certainly not coming home to the Detroit area.
As an aside, this isn't just affecting manufacturing here. My brother-in-law works for Ford accounting. They sent 70-80% of the positions in his department to India (accountants, etc.) keeping only the highest skilled and most critical positions in the US filled by USians. They eliminated something like 40 or 50 decent paying white collar jobs in his department alone.
Re:Return of car manufacturing (Score:1)
Re:Return of car manufacturing (Score:1)
IIRC, the Germans refer to the US South as "our Mexico."
Re:Return of car manufacturing (Score:2)
When 97% of U.S. "poor" have a color TV, I don't consider us very poor. Yes, I am a subscriber to Easterbrook's world view.
Re:Outsourcing is a good thing... (Score:1)
Toyota has plants all over the US, just not in Detroit: toyota us plants [toyota.com]. I know Honda has at least a few plants in the US (and Canada) probably many more than that as do most other Japanese Auto manufacturers. I think the parent post was referring to Japanese companies building in the US not US companies getting business back from the Japanese companies.