A young man I know is afraid his job—telling customers how to make their software work properly—is going to be moved to India.
If it is, he's not going, just his job, which will be taken over by an Indian software engineer operating via satellite telephone to the United States. Except for the Indian accent, no one is going to know where the explainer is when they call for help.
And there won't be much difference in the advice the Indian engineer gives the customer. India has excellent engineering schools, with graduates who match those that are employed in the United States.
The only clue you might have about your support's location may be his or her accent. It certainly isn't from Alabama or even California. Rather, it is in the center of India's "Silicon Valley."
And this is becoming fairly common. More and more electronic jobs are being moved overseas. The reason is simple: the cost of an Indian engineer is at least a quarter of what it costs to support such personnel in the United States. It's even less for an Indian telephone solicitor.
That doesn't make it any better, but it does make it cheaper. It's a trend that started after World War II when labor in Japan was cheap. It's a trend that has been growing ever since.
And the reason: the wages American workers want and get are pricing them out of the world market. It's the major reason behind the violent protests against globalization, which is the spread of companies from one country to many. This not only spreads a company's business; it also reduces its costs. And costs are where it's at in the corporate world these days.
One of the quickest ways to reduce costs is to reduce the payroll, no matter what the human damage caused by such layoffs.
A neighbor of mine was let go from his job after working for his company for 24 years. The same thing happened to another neighbor after more than 30 years.
More and more American workers are losing their jobs to faceless millions overseas.
Yet the use of other countries performing these jobs doesn't happen because international companies particularly enjoy hiring cheap labor. Rather, it is because they have to continually look at the bottom line of their balance sheets.
Because international companies —and a good many American companies now fit this category—continually have to worry about making money for their stockholders. So they also are forever looking for ways to cut costs.
And the single largest cost for most companies is labor, which in today's marketplace means out of the U.S.
It is cheaper for most products to be assembled in Mexico, Asia or South America and then shipped back. Thus, Americans— and some European countries— find themselves caught between the horns of a seemingly insoluble dilemma. If Americans or Europeans want to continue to live in the style to which they have become accustomed, they have to continue to work for higher and higher wages.
At the same time, in the search for reasonably priced consumer products, more and more they are going to be the prisoners of cheap foreign labor. You can't live well if you don't make enough money to do so. You can't afford to live well unless what you buy is relatively inexpensive. So it is this mess into which we have gotten ourselves and from which, at the moment, there seems no escape.
It's not that globalization doesn't work. Rather, it is that it works too well. And because it does, it is difficult to tell international corporations otherwise.
And CEOs and CFOs live or die by how well their stock does. And how well or ill their stock does depends on how much profit can be extracted from the manufacturing process. None of this, of course, makes it any better for the displaced American worker who, having lost his or her job, no longer can afford to buy the product he or she once helped produce or service.
But the same rules don't apply to many corporate executives, who have managed to make it very expensive to be fired or retired from their jobs. They all have "golden parachutes," retirement and severance packages they've negotiated when hired. Unfortunately that's not true of American workers. Their golden parachutes have not yet opened. In fact, they haven't even been manufactured.
Carl Heintze is a frequent contributor to the Campbell Reporter. He can be reached at carlheintze@juno.com.
|