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I just finished watching "Waiting for Superman" (which I highly recommend).
In the film, they reasoned that lots of technical jobs were being outsourced in America because there were not enough technically qualified candidates to fill them.
I've heard the complete opposite on this and other forums.
Thus I ask, do you believe this is why jobs are being outsourced?
No. Jobs are outsourced b/c labor overseas is cheaper. And the businesses that outsource love to blame academia for why they outsource so that busiiness doesn't look like the unpatriotic bad guy. Businesses often go overseas for tax breaks, cheap labor, materials, etc. and they always reason that they "have" to in order to stay afloat.
But it's sort of ridiculous to say that U.S. college graduates are not "qualified" for a position as a customer service rep or telemarketer or even "techie"; there are plenty of qualified people for those positions, they just demand a higher pay check b/c they live in a country with a higher cost of living. So, by going overseas, the company can pocket the larger difference between labor and product cost. The result is usually a lower-costing product but less jobs and job stability for U.S. citizens, which is why the working class in the U.S. has become a land of consumers living off of credit.
No. Jobs are outsourced b/c labor overseas is cheaper. And the businesses that outsource love to blame academia for why they outsource so that busiiness doesn't look like the unpatriotic bad guy. Businesses often go overseas for tax breaks, cheap labor, materials, etc. and they always reason that they "have" to in order to stay afloat.
But it's sort of ridiculous to say that U.S. college graduates are not "qualified" for a position as a customer service rep or telemarketer or even "techie"; there are plenty of qualified people for those positions, they just demand a higher pay check b/c they live in a country with a higher cost of living. So, by going overseas, the company can pocket the larger difference between labor and product cost. The result is usually a lower-costing product but less jobs and job stability for U.S. citizens, which is why the working class in the U.S. has become a land of consumers living off of credit.
Pretty much spot on.
Follow the money is the age old saying!
Eventually the outsourcing trend will even out. Wages are rising in developing nations. Likewise, wages in developed nations are dropping. Eventually those two will even out where the incentive to go overseas will be marginal at best.
Outsourcing is also the trend as the large corporations are hiring a lot of temp labor to avoid the benefit costs. Look for this to increase.
Offshoring for numerous reasons, i.e. labor costs lower, tax reasons, access to foreign markets, and they don't have to deal with any govt/environmental regulations.
It only matters what the beancounters and the stock flippers think at the end of the day.
Outsourcing is about money and doing it better. When you can get external experts to work on projects without having to retrain employees on every project that comes up, it doesn't make sense.
Also, it doesn't always make sense to keep permanent staff on payroll. There's times when there's more work and others when there is less.
Outsourcing is also the trend as the large corporations are hiring a lot of temp labor to avoid the benefit costs. Look for this to increase.
Offshoring for numerous reasons, i.e. labor costs lower, tax reasons, access to foreign markets, and they don't have to deal with any govt/environmental regulations.
It only matters what the beancounters and the stock flippers think at the end of the day.
Its not just about benefit costs. If you don't want to give benefits, then there is no need to so its not really a major factor imo.
The real big (hidden) cost I've seen in the potential legal costs. If I hire someone directly and fire them for whatever reason then they can come back and sue me. There are tons of employment related laws out there, its crazy. Minimum wage, working conditions, sexual harassment blah blah blah the list never ends.
If you outsource your labor these legal costs pretty much vanish. Very rarely will an outsourcer sue you. Simply due to the difficulty of suing across borders. Hell if you ask me, I'd say don't ever hire domestic labor, too risky.
Americans have spent so much time lobbying for employment protections that they've made themselves basically unemployable. The potential legal costs are too high.
Its not just about benefit costs. If you don't want to give benefits, then there is no need to so its not really a major factor imo.
The real big (hidden) cost I've seen in the potential legal costs. If I hire someone directly and fire them for whatever reason then they can come back and sue me. There are tons of employment related laws out there, its crazy. Minimum wage, working conditions, sexual harassment blah blah blah the list never ends.
If you outsource your labor these legal costs pretty much vanish. Very rarely will an outsourcer sue you. Simply due to the difficulty of suing across borders. Hell if you ask me, I'd say don't ever hire domestic labor, too risky.
Americans have spent so much time lobbying for employment protections that they've made themselves basically unemployable. The potential legal costs are too high.
I disagree. Lots of large companies have policies on benefits. It would be pretty difficult to all of a sudden pick out a group of employees and tell them they won't be getting benefits. And by the way, other similar groups will still be getting them.
That coupled with salary savings (if this is going offshore) are the main reason I see this. It really doesn't have much to do with legal costs.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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While I agree with most, as it's the lower labor costs overseas, there is also a lack of creative technical people here, forcing Microsoft to bring in a large percentage of their employees from other countries. We live in an area that is popular with MS employees and many came here from India to accept positions there, others from various european countries.
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