[IP] more on As It Tries to Cut Costs, Wall Street Looks to India

[Dave Farber <dave@farber.net>]

> Delivered-To: dfarber+@ux13.sp.cs.cmu.edu
> Date: Thu, 09 Oct 2003 20:40:26 -0700
> From: Thomas Leavitt <thomas@thomasleavitt.org>
> Subject: RE: As It Tries to Cut Costs, Wall Street Looks to India
> To: dave@farber.net
> Cc: Declan McCullagh <declan@well.com>
>
>
> Dave,
>
>  While I share some of Bob's concerns (it certainly doesn't thrill me to see
> systems administration jobs being shipped to India), I have to say that it
> is ironic of Bob, who has benefited by the choice of a Finnish company to
> "outsource" various chunks of its operations overseas, to criticize American
> companies for finding inexpensive but high quality talent in India.
>
>  Does anyone really think that the Ivy League graduate whose potential job
> is taken by the $35,000 year Indian research analyst is going to suffer
> tremendously? The likely outcome of a significant number of new hires in
> India is wage inflation there... eventually, what we're going to get is wage
> equalization on a global scale - as we have to some extent today across
> Japan, North America, and Europe. It may not be all happy days for American
> workers in these sectors, but they're certainly not going to be reduced to
> penury. Unlike manufacturing workers paid 35 cents an hour, these folks in
> India have a heck of a lot of other options if they feel abused - including
> migrating to the U.S. or Europe, or setting up shop on their own - and the
> employers can't just up ship and relocate shop to a lower wage area when
> people start demanding wage increases (as is happening in Mexico, where
> workers paid $1.26/hour are being out competed by Chinese labor paid a
> quarter of that or less) - India is pretty unique in that it has the
> educational infrastructure and the widespread knowledge of the English
> language necessary to make this happen at all.
>
>  We managed to absorb the entry into the labor marketplace of half the
> nation's populace (women) over the last fifty years without catastrophe for
> the incumbent labor force, I'm confident we'll be able to do this with India
> as well. And, ultimately, what we'll have is a that many more people capable
> of buying American products because they're being paid first world wages. I
> should also point out that people should get some perspective here - the
> fact that these folks are being paid $35,000 a year, already, says a lot
> about the likely ultimate outcome - while Ivy Leaguers may shudder at the
> prospect of working for $35k, a hell of a lot of Americans would be quite
> happen to be paid anything close to that. The companies in question have
> already implicitly realized that in a global marketplace, they've got to pay
> people a decent wage, or risk losing them to the competition.
>
> Regards,
> Thomas Leavitt
>
> From: Dave Farber <dave@farber.net>
> Subject: Date: Wed, 08 Oct 2003 17:29:02 -0400
>
>
> >From: Bob Hinden <hinden@iprg.nokia.com>
> >
> >Dave,
> >
> >Doesn't anyone understand that this doesn't scale.  First it was the
> >manufacturing jobs, now it is the well paying knowledge based jobs.  If
> >most of the good jobs are outsourced there won't be anyone here with the
> >money to buy the products and services that these companies
> >product.  Everyone will loose.
> >
> >Henry Ford raised the wage he paid his workers to give more people enough
> >income to buy the cars he was producing.  This outsourcing trend is just
> >the opposite.
> >
> >Bob
>
> --
> Thomas Leavitt, Sr. Systems Admin For Hire
> Resume at http://www.thomasleavitt.org/personal/resume/
> Phone: 408-591-3342 / Email: thomas@thomasleavitt.org / Fax: 815-371-2804
>
> Wired since 1981. Internet-enabled since 1990. Web-enabled since 1993.
> Older, wiser, and poorer, post-crash. :)
>
> Join the System/Database/Network Administrators Job Search Community:
> http://groups.yahoo.com/group/sdnadminjobs/

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