Dennis Stevenson over at Toolbox.com
asks a very important question, is Outsourcing Immoral, the sad reality
is that the debate over the morality of the process will in no way
lessen or stop the process of outsourcing.
Dennis (whom I respect and read on a regular basis) has asked a great question, the morality or immorality of outsourcing.
While it is great to want to “hire American first” and otherwise
employee our out of work IT personnel there are a number of events that
are driving IT and these events are things that anyone working in the
IT Field need to understand.
The level of American Graduates to Open Positions is falling and
continues to fall. In a number of confidential reports I have access to
about the state of education and computing, between 2000 and 2004 the
number of Americans in computer science degree programs fell 32%. This
is during two of the biggest changes to happen in computing
technologies, the advent of Social Networking (including server/client
based serveletts) and the rapid growth of Google putting a huge demand
on the job market. This is also a time when the Bureau of Labor
Statistics is projecting that between 2006 and 2016 (regardless of the
recession) will create 5.8 million new jobs and spin off some 75,000
new businesses. As early as June 2009 the IT Unemployment rate was 5.2%
overall in comparison to over 9% for other positions, this is hardly a
combination for successful “hire American”. The statistics are even
poorer when you realize that a significant proportion of CS and IT
degree seekers in America are on student visas.
The debate on the employability of US Graduates is in question, in a conversation started in India by Vineet Nayar, the CEO Of HCL Technologies basically said that US Graduates are unemployable. This was immediately picked up by information week and there was a lot of discussion around
this issue. The poor lack of real world training and experience that
students get in school. Compound this with a declining enrollment and
we are as a country setting ourselves up for failure. This is not a
morality question, this is question of are we training and pumping out
the IT graduates we need to get companies to hire American.
The world became flat – the need to drive costs down when you are a
business manager is intense. It is probably the most stressful part of
the manager’s job, and I know this first hand. When the world went
flat, when it was a cost point between $75.00 for an American
programmer not including benefits (more like $125.00 with benefits) and
a $45.00 an hour programmer anywhere else in the world, add this up
over the 2100 hours someone will work officially in a year. The cost
savings is immense, and in line with Dennis’s Virtuous Circles that he
uses in his article. Companies are in existence to make money by making
products that people want to buy at the lowest cost possible. That
lowest cost possible has enabled many companies to grow huge, but they
do this by keeping employment costs at a minimum. Employees in general
are the largest expense that any company has, and it is the first place
that a company will cut costs when the economy goes south. When I can
literally hire 2.5 for 1, why would I want to hire American? This is a
hugely successful model, and is also practiced successfully in the
United States by every company that employees Perma Temps like Google,
Microsoft, and a host of other companies. This all drives the profit
margin, which means money, which is the reason that a company exists.
While it is unpleasant to think like this for a great many of us,
the stark reality is that we graduate 1 person for every 10 open IT
positions in the USA. It is also equally unpleasant but stark reality
is that business does think of the bottom line, costs, and other
processes that make these companies competitive on the global stage. To
think that this is simply a US issue is myopic, this is a global issue,
and one that influences and effects every IT company or person on the
planet. Of course there are always things we can do like put a
preference on Americans when you hire, or helping colleges deliver the
people the company needs, colleges to be responsive to business, and
for business to think of people rather than bottom line costs but these
are unlikely to see a full fruition for decades to come. It does not
mean that it will not, this simply means that it is unlikely. There are
so many global pressures on companies and people right now that we can
ignore (and do to a point unless times are bad) that we drop down to a
question of morality and ethics.
I have been on both sides of the coin, and realistically only 10%
of the people I interview made it into the job. I have interviewed
hundreds of “experts” only to find out that they really don’t know what
they are talking about. This works equally well regardless of race,
religion, creed, or geographic location. I also know what it is like to
try to fill positions; I have had three open positions now for over a
year, but have been unable to fill them because I cannot find the right
people with the right skills and the right attitude. This is not a
question of morality, it is question of finding the right person to
fill the jobs I have open. I will hire the first person that comes
along with all the right degrees, all the right skills (and can
demonstrate them adequately) and the right attitude to work where I
work. I also won’t care where they are geographically, these are
positions I need filled.
The global stage is what it is, and regardless of how you feel
about outsourcing or how you feel about the morality or immorality of
outsourcing it is here and it is here to stay. Anyone looking for a job
now needs to understand they are competing locally and globally for the
same position. There are many companies that do hire locally rather
than outsource, and this is good. There are hundreds of open IT
positions that are for real jobs that companies cannot fill today. The
problem is what are employees doing to show that they really are the
ones that the company wants?
(Cross-posted @ IT Toolbox)
