Recent news reports should give a small measure of satisfaction to the hundreds of thousands, or possibly millions, bilked by Wall Street stock analysts. Those are the men and women who corruptly enticed people to put their money into wormy, worthless securities being peddled by the analysts’ employers. Stock-analyst jobs, like the bib-overall jobs from the Rust Belt, are being exported overseas.
College-educated stock researchers making $250,000 a year are losing out to people doing the same work in India for $20,000. Banks, stock brokerages and allied financial-services companies are expected to relocate 8 percent or half a million jobs to foreign lands in the next few years. General Electric’s investment-credit arm, G.E. Capital, already has 15,000 at their desks in India.
American companies are learning the sky’s the limit when it comes to exporting jobs that most people still think are not exportable. Tasks that range from simple call centers to developing software and designing jet engines are being shipped abroad and performed in China, Mexico, Australia, the Philippines, Russia and yet more countries for significantly less than they can be done in the United States. Companies have come into existence to help other companies transfer professional and semi-managerial jobs to India. The Information Technology Association of America did one of those surveys and learned that 6 percent of American firms have already moved information-technology jobs abroad.
So, ladies and gentlemen, we’d best revise our ideas about what jobs are and are not exportable. Most of us have been brought up to believe that it’s the holders of low-paid and unskilled jobs, or those working in highly paid, unionized, blue-collar manufacturing jobs, who may find their livelihoods sent elsewhere. Although seldom put as baldly, for more than a generation we have been told that brain workers are safe and brawn workers had better get over to the community college and take courses in computing. The world was to be divided up between smart, trained, white-collar Americans and all those other people who would do the heavy lifting. Nobody told us, perhaps because nobody then knew, that men and women wearing colorful robes who aren’t even monotheists could learn our tricks and would work for a tenth of the money.
They have already learned our tricks so well that when we call a General Electric toll-free number, we may be speaking with an Indian woman 8,000 miles away. If her practiced, American-accented English doesn’t convince us of her authenticity, then her fake American biography and her facility with up-to-date slang will. So many jobs in banking, finance, insurance and other industries, considered immovable a few years ago, are portable that business executives are saying, “India is on its way to being the back office for the world”.
Collaterally, the movement of jobs elsewhere bears on President Bush’s demands for cutting taxes to put more money in the hands of capitalists, who are to invest it in new plant and thereby create more jobs. But create more jobs where? In India or China? Money goes where its owners believe it will earn the best returns, and if that’s Bombay, that’s where it will go. In the short run, little can be done to keep dollars from going abroad, because keeping money in a country where money doesn’t want to be can take a nation straight to the edge of disaster. For America, struggling to hold its place as the world’s most powerful economy, restrictions on the movement of money are inconceivable.
A lot of money leaves the United States every year in what is called direct foreign investment. Ah, but everything is so complicated these days! Most of this money isn’t invested in sweat shops or anything else in cheap-labor countries. It’s invested in the E.U., where salaries are competitive with or even higher than here. Low-cost labor is only one of many possible motives for American job creation abroad. There are ancient reasons, such as closeness to markets-although in our age, when transportation costs have been so drastically cut, that is a weak variable. Sometimes the choice resides between relatively cheap but inferior American labor and more expensive but better trained and more reliable labor elsewhere.
Parenthetically, let it be noted that some American money invested abroad goes into enterprises demanding non-American, native labor. Among them are banking, hotels, retail, medicine and a host of service businesses which cannot be easily or profitably conducted by foreigners. Figuring more importantly in the export of jobs are some less-often-noticed changes in business. Of the 17 million people working for manufacturing companies, for instance, only a little more than half of them (52 percent) are employed actually making some physical object. The rest are service workers, selling, consulting, engineering, designing, handling customers, doing many jobs which today are exportable.
Unions, of course, have been the principal opponents of job exportation. As they are ever weakened by irreconcilably hostile business executives and a reactionary administration, no new countervailing forces exist to try to find a way to give American workers protection-if it’s even possible at this stage of the game.
At the least, our institutions and our people have to be told that the level of training they need to be sure their jobs aren’t sent off to Novosibirsk is getting higher. A few computer courses at the community college won’t do it. To remain competitive, many workers will need to train, retrain and retrain again after that. Even then, a worker may have surprisingly little bargaining power.
You can be as competitive as all get out and still not have a job these days. Millions who never dreamed of and don’t want to be self-employed have no other way of earning a living. Some are downsized into self-employment, others are down-shifted (as they now say)-and even if they’re not aware that they are competing with somebody in India who is just as worried about the future, people still work harder, work longer and worry more.
The propositions put forth by the Republicans and the Democrats are stale ideas, more suited to an age already passed. For the nonce, the news from downtown is that the rat race has gotten rattier.