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The outsourcing wave show no signs of abating. This recent New York Times article shows the next wave of outsourcing will be accountants from Sri Lanka.
And Sri Lanka’s contribution to global outsourcing? Accountants — thousands of them, standing ready to crunch the world’s numbers.
As this tiny island nation staggers back from a bloody, decades-long civil war, one of its brightest business prospects was born from a surprising side effect of that conflict. Many Sri Lankans, for various reasons, studied accounting in such numbers during the war that this nation of about 20 million people now has an estimated 10,000 certified accountants.
An additional 30,000 students are currently enrolled in accounting programs, according to the Sri Lankan Institute of Chartered Accountants. While that ratio is lower than in developed economies like the United States, it is much greater than in Sri Lanka’s neighboring outsourcing giant, India.
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In the United States, the median annual wage for accountants and auditors in May 2008 was $59,430, according to the Bureau of Labor Statistics. Sri Lankan workers in the accounting profession receive an average annual pay package of $5,900, according to a 2010 survey by the Chartered Institute of Management Accountants.
Like India and China produced thousands upon thousands of degreed IT folks.
With accounting pretty much 100% software based you can say bye-bye to that field for US jobs.
Outsourcing is both good and bad depending upon where you sit on the economic ladder. If you own a business then being able to lower costs is good, if you're a worker then this means you have to compete with huge numbers of foreign workers which you never had to do before and so your wages and standard of living are going to go down. We hope that over time there will be more businesses and employment opportunities as businesses become more efficient but I seriously doubt we can avoid increased long term unemployment in 1st world countries because of this. Capital is just too concentrated in too few hands to enable all the skilled people to start there own businesses.
The classical solution is to tariff foreign goods and services so that domestic unemployment goes down. This has the disadvantage of increasing costs to businesses but decreasing unemployment as businesses are forced to concentrate their employment domestically. It's a very complex situation and it's hard to see exactly what the right course of action is, no action, total tariffs, or some level between the two?
The outsourcing wave show no signs of abating. This recent New York Times article shows the next wave of outsourcing will be accountants from Sri Lanka.
So many accountants, odd, just like we have armies of MBA parasites in the West...
I am not so sure a lot of companies want to outsource something as critical as accounting, let alone to a war-torn island.
So many accountants, odd, just like we have armies of MBA parasites in the West...
I am not so sure a lot of companies want to outsource something as critical as accounting, let alone to a war-torn island.
For larger companies - the ones most likely to use outsourcing - most accounting represents thousands of routine transactions which are all done automatically by a computer. Why would you outsource something you are already doing automatically?
The tricky stuff, tends to be the development of accounting policy, one off transactions like an acquisition, revenue recognition decisions, etc. and require a reasonable level of skill and usually involve consultations with auditors and legal. This kind of stuff is probably too sensitive to outsource.
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