The outsourcing death spiral

The quality (and quantity ) of work being outsourced overseas is increasing exponentially. Given a predatory global system of capitalism that must always find cheaper ways of doing things in order to remain in business, this trend will only  accelerate.

In accounting, for example, A/R and A/P processing, payroll taxes, income taxes, bookkeeping, financial statement compilations, and more is increasingly done overseas. Moreover, once the company has moved manufacturing and other operations overseas, other jobs will follow. Auditing has to be done onsite. Thus the auditors will probably live in that country. So will the support staff and management.

A website client recently requested that a section of their website only be viewable by those who have paid to do so. This involves some fairly sophisticated programming. I ended up getting it done in Nepal by quite competent programmers for $15 an hour. Were this to be done in the States, it would be at least $60 an hour, probably much more. It’s not just that it was much cheaper. The client would have passed on the project had it to be done at US rates.

But this cuts both ways. One of my main businesses is converting ancient DOS database applications to Windows. There are millions of such apps out there, often running mission critical pieces of a business. The app has been wheezing along in DOS since 1988 (you probably think I’m kidding, right, that any business, much less a large one, could still be running such dinosaur programs? But they are!). Then, they upgrade to Windows XP and discover the program dies a horrible screaming death, if it runs at all.

That’s when they start looking for me. But, I’ve no illusions here, soon they may get this done in India, or Nepal, or China.

How are the workers in these countries treated? We don’t know. Back in the mid-70’s I worked in the West Texas oil fields and discovered up close and personal what happens when there’s no union or the threat of a union. We worked seven days a week, 52 weeks a year. You want a day off asshole, then quit. The workers were exploited savagely, and were too beaten-down to fight back. I’m sure it hasn’t changed.

So, I wonder, what are working conditions for those doing this outsourced work? The burnout rate and pressure must be tremendous because after all, there’s many more who want your job if you can’t “meet expectations.”

Plus, these are highly skilled jobs! What about those dirty, dangerous factory jobs done in sweatshop conditions all over the world? This is “outsourcing” too, yet oddly it’s not called that, as the term is only used for technical and skilled work. For the less fortunate, the work can be hideous and toxic, as Exporting Harm, a documentary about small villages in China where manual disassembly of old computers is done, clearly shows.

The engine of predatory capitalism requires ever-cheaper labor. Now that same engine is biting the United States, and biting hard. Once secure jobs are vanishing, going overseas, and once overseas, the cycle continues, with the work constantly moving to whatever country currently has the cheapest rates, a downward spiral that benefits no one long-term except the wealthy few on top.