The Job Market

au,

That is an excellent article. America has long been able to adapt to these evolutions.

But offshoring is something different. It's not foreign industry beating our noncompetitive ones it's our own corporations positioning themselves for greater profit.

It's hard to say whether the value of our enormously powerful corporations is worth such a drain. I think that some minimal changes should be made. First of all in almost any economy I am in favor of reducing the employment related taxes that the employer pays.

But a more controversial move that I haven't yet fully thought out is whether a tax on offshoring should be implemented.

Don't get me wrong, Indian programmers deserve kudos. They are highly competitive and this is the type of offshoring that might indeed be irreversable. But offshoring tech support and other skilled services provided directly TO the US through increasingly globalized mediums is something that mkght well be curbed through a tax.

But IMO it is dangerous to wage an all out war on offshoring. Our corporations don't do it to undermine their own sectors, they do it for sound business reasons and despite all there is to hate about some corporate policies they are a powerful element of our economy and hampering them too severely could backfire.

But one important thing to keep in mind is the floating factor. This is not a calculated drain. It is the evolution of a free floating market. We are already protectionists with our failing industries and to become protectionist with out tech inductry could backfire in a dangerous way.

You may think offshoring is bad but even worse is an economic downturn. A jitter on the stock market can cost jobs just as easily. To become more protectionist with our tech industry is not just a reversal of our geopolitical policy of pretending to promote free trade. It is a dangerous move whose reciprocal actions could mire our most promising sectors in recenssion or, even worse, take away some of our competitive edge in technological innovation.

Protectionism kills competitiveness. And it is a falsified form of success. Time and time again the US preaches this to protectionist-minded third world countries and time and time again I have seen protectionist nations become competitive overnight through floating markets.

There are always HUGE hurdles. Look what unpegging did to Argentina. Look at Brazil's shaky progress.

Both nations through yeilding to globalism suffered more than Americans can imagine. In Argentina's case this was so pronnounced that many who live in third world countries have a hard time comprehending the events that unfolded there.

But globalism is more than a policy. It's a phenomenon. Globalism is rooted in human nature, not in the decisions of nations. To fight globalism is to fight an ocean.

It's not so much a panacea as it is a force of nature. And while ther are many compelling arguments to fight it I think that fighting ot is like fighting a tital wave.

Sure, the wave is no cure all. But fighting it might be more damaging than harnessing it. Globalism is here to stay. Do you want to be Japan of the closed borders or Japan of the overnight economic success? Fight globalism at your own risk.

Well put, Craven. Japan is a very good example. They also have protectionist policies, and they end paying much more than is necessary for many products they could otherwise have at much cheaper prices - at home. They end up going to China to by products made in Japan. That's only one example. c.i.

I was actually talking about back in the day when Japan was all into posting "we will chop off your head" signs on their beaches.

Once they truly joined the free market their "catch up" was amazing and a testament to how a head-start can and will evaporate.

But their increasing demand for protectionism against China is interesting to follow. Their problem is not China.

Much of Japan's economic problems have been self-imposed. c.i.

On the econ discussion here, I immediately agree with Craven, but that is no advantage to him as I cannot bolster his points with other than fairness arguments. Plus I gather there are arguments on the other side that globilization is destructive for a lot of reasons, though I am not sure I understand them.

My own take is different...that we in the US have almost totally lost touch with making anything at all,, close at hand. We think we do, but not really. To a large extent, we are not forced to make do with even older items. We have long ago - generally speaking - stopped making things for around the house except as a hobby, that hobby being more a sign of advantage than disadvantage.

I once got interested in crafts as an idea for a tv series. I wanted to do a multiple series of thirteen, each series with 13 half hour visits to different countries for crafts (13 or more for Europe, 13 for Asia, and so on), combining a look at the individual sites, tour and interview, with a bit of geography and history content. For example, Faenza in Italy has something like 70 ceramic workshops. These are individual manufacturing places, with some level of craft happening in the output. I started riffing, well, think of where craft happens...

I was thinking of crafts past Martha Stewart's domain, although I was thinking of this pre my knowledge of her...and have kept files off and on over those years. I have a friend who has collected craft pieces over central and south america, and through her have a sense of the richness. I know or think I know of many more places with serious craft ability.

What I see in my own California town is this agonizingly pitiful, to me, place called Joanne's, a chain store with a lot of schlocky craft stuff, easy-craft.

My first friend in college, who came to Los Angeles from Sweden a decade before as a nine year old, could tat lace and paint on plates and sew a wardrobe...became a medical illustrator when she grew up.

What am I whining about? A lot of that individual capability hasn't been transferred to next generations. Never mind lace, weaving could be useful, and carpentry, etc.

Jobs?
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>
- The Welfare Office
A man walked into the local welfare office, marched straight up to the counter and said, "Hi, I hate drawing welfare. I would really rather find a job."

> The person behind the counter replied, "Your timing is amazing. We just got a listing from a very wealthy man who wants a chauffeur/bodyguard for his nymphomaniac daughter. You'll have to drive around in a big black mercedes, and the suits, shirts, and ties are provided. Because of the long hours of this job, meals will also be provided and you will also be required to escort the young lady on her overseas holiday trips. The salary package starts at $200,000.00 a year with room for bonuses.

> The man said, "You're bull-----ing me!"
>
> The clerk behind the counter said, "Yeah, well,... you started it."

I'm not sure I agree. The land is a beast. The lack of the basic ability to produce enough food to feed its population is just one example of a difficult land factor.

But their business practices have had to adapt. And guess what is one of the things that is changing?

Loyalty to the employee.

It used to be that the employee was almost always employed for life. Now Japanese corporations are becoming more competitive.

Taking the best value for the price is the essence of competitive capitalism.

The fact remains that industry both manufacturing and now white collar are bleeding out of the US. We have been a consumer nation for some time now and becoming more so. The question how long can that continue. Inorder to buy one must sell or produce. You must have money to spend money, that is unless you are the government where you can run deficit. But even that will come up and eventually hit you in the ass.
Globalization lives on the premise as I understand it that the poorer nations through it will be able to lift themselves out of poverty and pay there workers a better wage thus allowing for an upgraded standard of living and in turn enabling them to purchase items from the industrialized nations, i.e., the USA. Sounds great. Question what will we have left to sell. The answer to that has been we will generate new industries and concepts. Yes and in the present climate they will remain in the US long enough for the big corporations to find lower cost producers in low wage nations. That aside I believe that the concept is something akin to water seeking it's own level. Eventually things will level off and there will be a level world wide economy. That sounds great however, if it ever happens, which I doubt,and will take about 50 years {guessing} If it does will they come up to our level or will we sink to theirs. Again that is the little I think I understand about globalization.
As far as protectionism is concerned I agree it does not in the long run solve any problems. I have no answers only questions. How can we stem the tide before it envelops us?

Hope this isn't too incoherent.

Nah, Globalization is based on the premise that it's a small world and it's getting smaller and that there is little to nothing one can do about it.

What conclusions you draw from that is up to you. It can be sold as an evil or a boon. I don't try to make either case much. The most important part is that it's unlikely that nay nation can fight it for long.

au, Globalization is upon us; it will not reverse itself. What is happening is that many large corporations must become multinational to exist - to remain competitive in the world markets. How the managers remain creative/innovative in providing their products and services to the world markets will be the basis on which they survive or fail. It's no longer a question of 'protectionist' policies by individual governments. We will see mergers in the future - not less. A good example are the mergers in China between the industrilized countries and Chinese companies. That will be the future of capitalism in this world. c.i.

Job Losses in July Add to Mixed Economic Signs

By DANIEL ALTMAN

[]he economy shed 44,000 jobs in July, the Labor Department reported yesterday, though the overall unemployment rate edged down.
The rate fell, to 6.2 percent from 6.4 percent in June, only because the number of people looking for jobs declined faster than the number of people holding them. People have been withdrawing from the labor market in greater numbers because of their poor prospects.
The latest data on job losses, which came a day after the Commerce Department's mildly encouraging report on economic growth last quarter, left economists wondering what to believe.

Another indication of the validity of the reported unemployment statistics.


Remainder of article at:
http://www.nytimes.com/2003/08/02/business/02ECON.html?th

Booming China trade rankles US

Trade deficit with China, now running at $120 billion a year, surpasses the total US trade gap of six years ago.

By Ron Scherer | Staff writer of The Christian Science Monitor

KANNAPOLIS, N.C. – She was the weaver; he was the loom-fixer. For the past 20 years of their marriage, Delores and Robert Gambrell strode the heart-of-pine floors at Pillowtex's Plant 16. The noise from the looms forced the couple to communicate in a sign language. They even had their own signal for "I love you."

Those days are over for now - the victim of a flood of imports from China. The nation's third-largest textile company, where the Gambrells worked, closed its doors last week. For the moment, that means the end of sheets and towels with the household names of Cannon and Fieldcrest.
The trend reaches far beyond the textile industry or Kannapolis - a community whose name means "city of looms" but which is shedding 5,000 Pillowtex jobs. Manufacturing businesses from electronics to furniture and fishing lures are closing their doors or moving production to China.
The rapid erosion of well-paying jobs has wide implications for the economy. Consider that the US trade deficit with China is now running at an annual rate of $120 billion - a record single-country amount that is larger than America's entire trade deficit only six years ago.
"This will become the dominant economic policy issue in the US [over] the next five years," says Don Straszheim of Straszheim Global Advisors in Santa Monica, Calif.
Indeed, China's export push is already becoming a front-burner issue in Washington. Congress has asked everyone from think-tank experts to Federal Reserve Chairman Alan Greenspan for answers to the problem. Three members of the president's cabinet on a cross-country jaunt to promote the Bush economic plan have gotten an earful from angry businesspeople trying to compete with Chinese imports made by workers getting 50 cents an hour. The loss of jobs to imports is almost certain to be a recurring theme in the Presidential campaign next fall and beyond.
The numbers are eye-opening. Chinese exports soared 22 percent last year. And it's not just low-cost towels. Exports of computer and telecom products are growing 60 percent annually. While American firms have struggled, Chinese companies reported profits rose in the first quarter by 56 percent from the previous year.
To some, this may seem like a replay to the 1980s, when the US trade deficit with Japan swelled to about $50 billion a year. It seemed as if Japanese automakers and semiconductor companies would devastate the US economy.
"The atmosphere today reminds me of the 1980s," says Clayton Yeutter, who was the United States Trade Representative back then. "Everyone worried about the Japanese being 10 feet tall, and all of that turned out to be inaccurate," recalls Mr. Yeutter, now of counsel at Hogan & Hartson, a Washington law firm.
Back then one of the major complaints was about the Japanese yen, which many felt was kept unreasonably low to benefit the big exporters. Today, business is complaining about the value of the Chinese yuan, which is pegged to the US dollar. "It is hugely undervalued," says Frank Vargo, of the National Association of Manufacturers. "It could be as much as 40 percent undervalued, and that is a major reason for the trade deficit." The argument has been picked up quickly by members of Congress. Last week, Rep. Donald Manzullo (R) of Illinois, chairman of the House Small Business Committee, was among 14 cosigners of a letter to the administration encouraging "stronger action."
Last week, Treasury Secretary John Snow said it was a critical issue that he intended to discuss with the Chinese during a planned trip this fall.
Yeutter says a floating yuan would make China, now a corn exporter, a net importer of corn and soybeans.
Mr. Manzullo says his district is among those feeling the heat from China. Unemployment in Rockford, Ill., is now 11.3 percent. Machine tool manufacturers, tool and die companies, and bolt and screw manufacturers are all struggling.
One of those who has testified at the end of June before Congress is businessman Jay Bender of Falcon Plastics Inc. in Brookings, S.D. In an interview, he recounts how one of his customers, a manufacturer of fishing lures, has decided to move its production from the US to China. This would allow the company to cut its manufacturing costs by half. It asked him to bid on molds to make the plastic bait. He bid $25,000 per mold. "That was a competitive price," he says.
Instead, the company found a Chinese source for $3,000 a piece. "I can't even buy raw materials for that," he says. "There are two possibilities: Either they are subsidized by the government or they gave away the molds to get the manufacturing business," says the businessman, who has to lay off 30 percent of his workforce so far.
But Mr. Bender has fared well compared with the US textile business. US markets are getting flooded by Vietnamese and Chinese goods. "People are moving jobs faster than you can count," says Charles Bremer of the American Textile Manufacturers Institute, which is lobbying for emergency protection.
It may get worse for the industry. In 2008, all quotas come off Chinese imports. "At that point, the Chinese will completely dominate the market," says Mr. Bremer.
The effects can be seen in Kannapolis, where the Cannon Mill closing has taken on the air of a natural disaster. The layoffs are the largest in state history, and social workers are descending on the town to set up satellite offices. People are turning off cellphones, cutting cable TV, and pleading with creditors. Already, 200 have had their water shut off.
"They're going from $35,000 a year with overtime to making maybe $9,000 a year," says Joe Rogers, a local official with the Union of Needletrades and Industrial Textile Employees (UNITE!).
Sen. John Edwards says he will try to secure $38 million in federal aid, and Sen. Elizabeth Dole is opening an office in town to take questions. But workers are leery: "We don't want questions answered, we want a paycheck," says Mr. Rogers.
Hundreds of businesses rely directly and indirectly on the mills, including everything from pizza palaces to mortgage brokers. For the Gambrells, the plan now is for Ms. Gambrell, in her early 50s, to go back to school, while Mr. Gambrell tries to find a job - doing what, he doesn't know. "We always said we wouldn't do anything if we couldn't do it together," says Ms. Gambrell, offering a tired smile to her husband.

Despair of the Jobless
By BOB HERBERT


he folks who put the voodoo back in economics keep telling us that prosperity is just around the corner. For the unemployed, that would mean more jobs. Are there more jobs just around the corner?

This alleged economic upturn is not just a jobless recovery, it's a job loss recovery. The hemorrhaging of jobs in the aftermath of the recent "mild" recession is like nothing the U.S. has seen in more than half a century. Millions continue to look desperately for work, and millions more have given up in despair.

The stories have been rolling in for some time about the stresses and misfortunes that are inevitably associated with long-term joblessness: the bankruptcies, foreclosures and evictions, the dreams deferred, the mental difficulties — anxiety, depression — the excessive drinking and abuse of drugs, the family violence. There are few things more miserable than to need a job and be unable to find one.

How bad is it? The Economic Policy Institute in Washington reported last week that "since the business cycle expansion began in November 2001, payrolls have contracted by 1 million (1.2 million in the private sector), making this the weakest recovery in terms of employment since the [Bureau of Labor Statistics] began tracking monthly data in 1939."

John A. Challenger, who runs the outplacement firm Challenger, Gray & Christmas, said it is taking an average of 20 weeks for job seekers to find employment, and many are unable to match their previous salary. "Employers have all the cards," he said. "Not only are they sharpening their salary pencils, but the screening of candidates is probably the toughest it has ever been."

The official jobless rate, now 6.2 percent, does not come close to reflecting how grim the employment situation really is. The official rate refers only to those actively seeking work. It does not count the "discouraged" workers, who have looked for jobs within the last 12 months but have given up because of the lack of offers. Then there are the involuntary part-timers, who would like full-time jobs but cannot find them. And there are people who have had to settle for jobs that pay significantly less than jobs they once held.

When you combine the unemployed and the underemployed, you are talking about a percentage of the work force that is in double digits. That's an awful lot of lost purchasing power for a society that needs broad-based wage growth among its consumers to remain economically viable. Most Americans depend on their paychecks to get from one week to the next. If you cut off that paycheck, everything tends to go haywire.

Right now there is no plan, no strategy for turning this employment crisis around. There is not even a sense of urgency. At the end of July the Bush administration sent its secretaries of commerce, labor and treasury on a bus tour of Wisconsin and Minnesota to tell workers that better days are coming. But they offered no real remedies, and the president himself went on a monthlong vacation.

The simple truth is that the interests of the Bush administration's primary constituency, corporate America, do not coincide with the fundamental interests of workaday Americans. On the business side of this divide, increased profits are realized by showing the door to as many workers as possible, and squeezing the remainder to the bursting point. Productivity (based primarily on improvements in technology) is way up. Hiring, of course, is down. Part-time and temporary workers are in; full-time workers with benefits are out.

And then there's the ominous trend of sending higher-skilled jobs overseas to low-wage places like India and China, an upscale reprise of the sweatshop phenomenon that erased so many U.S. manufacturing jobs over the past quarter century.

Working Americans need jobs just to survive. But the Bush administration equates the national interest with corporate interests, and in that equation workers can only lose.

There are ways to spark the creation of good jobs on a large scale in the U.S. (I will explore some of them in a future column.) But that would require vision, a long-term financial investment and, most important, a commitment at the federal level to the idea that it is truly in the nation's interest to keep as many Americans as possible gainfully employed.

hi all..
I would like to know about the job propects in UK specially when a person migrating to UK after getting married to a Brit born Indian gurl.
Im 23 and working in a BPO sector who are majorly into cust care/telemarketting. I have an exp of 4 yrs in hospitality/service industry.

If any1 could assist.. il be glad..

Hi vinaythakur, WELCOME to A2K. Not sure what you mean by BPO sector. Also, there are many A2K members on A2K that could probably answer your question. Good luck!

well,
BPO is bussiness process outsourcing. which cud simply means overseas bussiness getting outsourced to asian countries.. eg-- call centers.

I think most of us are aware of the BPO's to India. Are there other countries involved? If so, how significant is it to our job loss in the US/Canada?

well i dont think that US/Canada might suffer coz of BPOs to ASIA..
you can visit this to get a latest update.
http://www.mckinsey.com/knowledge/mgi/offshore/

I agree with Craven on this one.

Vanay, Thanks for the link on offshoring. I couldn't put it into so many words, but that's been my belief all along. Comparative advantage benefits all.