68 lines
4.0 KiB
Plaintext
68 lines
4.0 KiB
Plaintext
Outsourcing breeds more jobs
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<p>CNNMoney <a href='http://money.cnn.com/2006/02/23/news/economy/jobs_it_offshoring/index.htm'>reports</a>:</p>
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<blockquote><p>
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Demand for technology workers in the United States continues to grow<br />
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in spite of American companies shifting more technology work overseas,<br />
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according to a new study.
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</p></blockquote>
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<p>Sigh. Is there, like, some cosmic law that reporters have to be<br />
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poisonously ignorant about economics? Of <em>course</em> outsourcing<br />
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stimulates domestic demand. Increases in efficiency and better<br />
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exploitation of comparative advantage <em>do</em> that.</p>
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<p>Maybe I’m just naive, but shouldn’t a reporter at a <em>business<br />
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news channel</em> know better than to subscribe to the fixed-lump-of-labor<br />
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fallacy?</p>
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<p><span id="more-264"></span></p>
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<blockquote><p>
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The study cites estimates that between two to three percent of IT jobs<br />
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will be lost annually to lower-wage developing countries through the<br />
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process known as offshoring. But it said the U.S. IT sector’s overall<br />
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growth should outpace that loss of jobs, expanding opportunities for<br />
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those trained in fields such as software architecture, product design,<br />
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project management and IT consulting.
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</p></blockquote>
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<p>Comparative advantage, kids. That’s what it’s all about. If<br />
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there’s <em>any</em> way in which the average programming skillsets in<br />
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the U.S. and India diverge, market pressure will sort jobs and push them<br />
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where they’re most efficiently performed.</p>
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<blockquote><p>
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“Despite all the publicity in the United States about jobs being lost<br />
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to India and China, the size of the IT employment market in the United<br />
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States today is higher than it was at the height of the dot.com boom,”<br />
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[...] lower wage scales in India and China are not pushing down pay<br />
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for U.S. IT workers. [...] IT workers have seen steady gains in<br />
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average annual wages for different fields in the sector of between<br />
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about two to five percent a year.
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</p></blockquote>
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<p>This is where libertarians like me get to gloat a bit, pump a fist<br />
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while shouting “laissez-faire!”, and point out that both left-wing<br />
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antiglobalization moonbats and right-wing isolationist/protectionist<br />
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wingnuts that they are full of horse puckey up to here. Welcome to free<br />
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trade, making everybody richer exactly the way we expect it to do when<br />
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governments don’t piss in the soup because they think they’ll like the<br />
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flavor better.</p>
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<blockquote><p>
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The study suggests that there are several factors in the continued<br />
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growth in demand for IT workers here. The report said part of it is<br />
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due to the use of offshoring by U.S. companies, including start-up<br />
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firms, to limit their costs and thus grow their businesses. That, in<br />
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turn, creates more opportunities here even as an increasing amount of<br />
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work is done overseas.
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</p></blockquote>
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<p>And there it is. Offsharing grows businesses so they can find or<br />
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create more domestic opportunities. That’s the invisible hand right<br />
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there, giving a rude finger to every single “managed trade” idiot and<br />
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regulatory busybody on the planet.</p>
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<blockquote><p>
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The study also said that companies from a variety of sectors in the<br />
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economy continue to discover greater efficiency and more competitive<br />
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operations through investment in IT. The study therefore argues there<br />
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will be continued growing demand for IT as underserved fields such as<br />
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health care, retail trade, construction, and certain services make<br />
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greater investment in technology.
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</p></blockquote>
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<p>This means that IT is being substituted for other, more expensive<br />
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inputs of production (a kind of <a href='http://esr.ibiblio.org/?p=262'>ephemeralization</a>). As long<br />
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as that keeps happening, demand (and IT wages) will continue to<br />
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rise.</p>
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