Glog

Indian Standard Time

Since outsourcing is all over the news these days, let's talk about it. How big a deal is this, and who does it affect? Is it a good or bad thing? And, yo, this girl is fly. Hey, Ma, arrange me with her. If she wants my job, she can have it anytime.

It's not just engineers who can be outsourced, it's accountants, IT professionals, call center jobs - pretty much anything that doesn't need face-to-face customer interaction. Indian companies are even handling outsourced Power Point presentations. Software development is probably one of the easiest things to outsource. Hardware will follow (Indian firms are already doing ASIC design). I'm a little worried.

I want all of you to think about this. It's more profound than we realize. Economic epochs are becoming shorter and shorter. It took about 50 - 75 years for the US economy to go from being heavily agricultural to being factory based manufacturing jobs (1875 to WWII). Agriculture was outsourced. Now only 2% of the US population works in agriculture (yet the country is more well fed than ever). Next, manufacturing jobs were funneled to Asia where it was done much cheaper. That only took 25 to 30 years. And now for the first time we see white collar, degreed jobs being outsourced. It's happened in the last 5 years. We're yet to know it's impact and how much further it will go. But at the speeds things move these days, it could take only 5 years to find out.

The US economy has always been able to reinvent themselves and keep growing. When farming jobs dried up, people moved to the factories. When fatory jobs started dissapearing, we ushured in the technological era, and we were more than occupied modernizing everything from the way we bank, to the way we shop. What will we do next? Where are the entry level jobs going to be when one finishes college with a degree in engineering? We're the ones who will have to make more adjustments than any other worker in western history. America led in technology. Now entertainment is America's biggest exort. But have you noticed that the highest grossing movies of the past years have been foreign (Lord of the Rings and Harry Potter)? Even Hollywood is losing it's grip.

So where do we go from here? Is it okay for companies to outsource these jobs just to pad their bottom line? GE, IBM, Dell already make astonishing amounts of pure profit. Isn't that enough? But this is a capitalist society. It's okay to chase the almighty dollar; that's the name of the game. I think capitalism is flawed that way, but that's opening a whole new can of worms that we could discuss for days. It's ironic though, that US companies are the ones effectively damaging their own country.

Maybe things are not as bleak as I might have conveyed. We might be the last lucky ones. The Baby Boomers will start retiring in 2007, and that will last for 7 years. We can sneak into the jobs they leave behind (part of the reason I'm positioning myself towards management). That will cushion the blow a bit. If you're an engineer, get your PhD so you can teach, or work on leading edge research initiatives (traditionally kept on-shore, because it's funded by the fedarlies). Consumer electronics and engineering grunt work will go to India, China, and then perhaps Africa. How interesting, when India's standard of living is pulled up far enough, it'll be cheaper to outsource their jobs somewhere.

Tell me your thoughts on this.....

Posted by G at February 22, 2004 06:52 PM | TrackBack