Nearly 1.5 Million Back-Office U.S. Jobs Seen Moving Abroad

[OhioChick]

By Eric Chabrow
InformationWeek

Oct 27, 2006 09:27 AM

America's largest companies could save $58 billion a year by moving nearly 1.5 million back-office jobs overseas over the next decade, according to research conducted by The Hackett Group, a business consultancy.

That translates to $116 million in annual savings and the transfer of nearly 3,000 full-time equivalent jobs abroad for the typical Fortune 500 company, Hackett says in a report to be released Nov 7. Hackett provided a summary of the report to InformationWeek.

Moving about half of general and administrative jobs abroad represents an evolution in offshoring. Until a year ago, the overwhelming number of jobs sent abroad were for short-term projects, often involving IT. Now, a growing number of permanent back-office jobs are being targeted to relocate offshore. Some 15% of the Fortune 500 already offshore G&A jobs, says Michel Janssen, the Hackett managing director who headed the study.

A sign of the times, Janssen says, is the growing number of large, American companies that have created in the past year executive positions such as VP of global development to address the globalization of corporate resources.
http://www.informationweek.com/news/showArticle.jhtml?articleID=193402615

[Cary]

1. If Fortune 500 companies don't need to pay Americans any more, maybe. . .

Americans really don't need to buy from Fortune 500 companies?

[Miss Chybil]

10. Bingo. nt

[diamidue]

20. In a global economy

if they lose USA customers, there are always the Russians and Chinese, etc. These Fortune 500 companies will just find customers elsewhere. They have no more loyalty to the USA than to any other country..

[NuttyFluffers]

32. yes and no... we're still the strongest consumers

china and russia right now have both nowhere near a large enough middle class of consumers to absorb all that excess production. and the middle class they have does not have the equivalent purchasing power of americans as seen from the global market. if america's middle class implodes there's not enough of a broad, stable market elsewhere to consume that differential. remember, it would be the elites of china and russia to duplicate the levels of consumption/purchase power of an average middle class american. and not enough equivalent buyers means oversaturation and other unpleasant things.

there's a reason why it was brilliant (and also obvious) business thinking when henry ford payed his workers higher than the industry norm -- he was building a new market as well as compensating his production. a lot of the business right now fixate on cutting production costs and try to compete for old markets assuming they'll always remain. sure you reap enormous profits in the short term, but they are strip mining the markets and not reseeding that money to foster future consumers. it's basically eating your seed corn along with your harvest and proclaiming it's the biggest bumper crop ever. it's beyond stupid.

[cyberpj]

2. It's still unbelievable to me that these workers haven't organized yet.

To strike now and demand contracts is the only way to create the attention needed to fight this drip drip drip of good jobs getting outsourced. Soon, we will be a country of CEO's and Walmart employees.

AMERICA NEEDS A REBIRTH OF UNIONS!

[greccogirl]

21. It won't do any good.

I was in a union for years, and every year "outsourcing" was the #1 concern. The companies will not allow it - and they will let the employees strike first. Been there, done that. The unions cannot get any language against outsourcing.

[NuttyFluffers]

31. true, it comes back to politics.

other nations refuse to allow unionization, and american businesses find it a great resource to exploit. we can't control overseas unionization outside of influencing our own political machinery here. we need to stop the economic policies here cutting our own throats in industrial capacity, and we need to realign economies by being supportive for intl. min. wage etc. it's been our bassackward national economic policy that's been killing american's checkbook for decades now -- almost singly tied to conservative/neo-con/neo-liberal (whatever you wanna call it) econ theory elevated to the level of dogma. i guess you could call it US/Western econ ideology. and the party that most indulges this stupidity is republicans, (though there's enough democrats fanning the wildfire to raise eyebrows).

[barb162]

26. The US workers do need to unionize.

But they won't think of it until they have lost the jobs. How many times do American workers need to see it hit other jobs? Everyone thinks it won't hit them.

[customerserviceguy]

35. It's been tried

over and over in white collar jobs, and only in government has it been successful. I used to work in title insurance, back in the early 1970's Safeco Title fired all of the low level unionizing workers, gave the more trained ones a bit more money, and broke the union.

[Double T]

3. 'WE' are living the demise of America and its workers.........

what will be the breaking point when the vast middle class rises up and does something about IT???? Traitorous corporate america and wall street are selling out their own country.

[cyberpj]

4. I keep asking the same thing. I believe 2 things:

Most middle class have become sedated with cheap goods and way too much entertainment.

Unfortunately, the rise of wealth after WWII created generations of satisfied consumers who don't see the value of organizing and fighting for something bigger than themselves as long as "they've got theirs".

Once the debasement reaches the level needed to wake up American masses, it will be too late.

[Double T]

6. Absolutely right! When the American masses have NO MONEY........

THEY will also have NO POWER and IT will be TOO LATE.

[SoCalDem]

8. Um..It's already "too late"

People go around pretending that they have control over their lives, but most don't.

Most people's homes are owned by banks (they merely rent them from their banks as long as they have the money/jobs)

Most people's cars are owned by finance companies/banks..

Most people have to ask someone's permission/approval to take vacation time or a day off ..

Most people have to explain to someone why they need a day off for medical care or to take care of a sick child..

Most people have to rely on kissing up to someone for a raise in pay ( usually accompanied by an equal to or higher than the raise amount of increase in employee share of health insurance..if you are lucky enough to even have it)

Most people are struggling to keep their heads above water, and have little or no savings.

[Double T]

9. Don't forget the 'hangman's noose' of the credit card debt of which....

the average family has $25,000.00 of IT. It is TOO LATE, 'WE' just have NOT realized IT (or accepted IT) yet.

[kestrel91316]

18. It's called "bread and circuses".

".......Most middle class have become sedated with cheap goods and way too much entertainment......."

It worked REALLY well for the Romans..........for a while.

[barb162]

29. You have the answer

"Unfortunately, the rise of wealth after WWII created generations of satisfied consumers who don't see the value of organizing and fighting for something bigger than themselves as long as "they've got theirs"."
And the corporations and Bush government know this is the way people think. They use it against the middle class because the middle class is a willing victim and can't see beyond its latest ever cheaper TV set. (It's good that you lose your well-paying job so someone from Asia can do that job and other Americans can buy cheaper stuff)

[barb162]

28. The problem is the middle class is not rising up

which amazes me. People should be screaming about this. Everyone is afraid but still hopes it won't him them personally. It will, unless you're a RN

[pokercat999]

34. Most of us are wearing golden chains. We will not rise up

until those chains are broken. That will probably be by our grandchildren or our great grandchildren.

[cyberpj]

5. Soon America will be a country of super rich CEO's and Walmart employees.

Middle class jobs will become a luxury in America's new corporate, money-grubbing future unless Americans remember the power of organizing into unions and striking while it still hurts the billionaires to get decent wages and benefits.

And then those unions need to start working for American business employees in the third world countries that are already being exploited. Without these types of changes, like I said, American will soon be a country of billionaire CEO's and Walmart employees.

I'm not against exporting American business, but it could - and SHOULD - have been done while also exporting quality American business practices instead of exploiting the new country's lack of environmental laws and slave labor wages. Instead of bringing our wealth and prosperity to them, big business is intent on bringing their lower standards here - or at the very least, balancing DOWN instead of balancing UP.

It's just too sad for words, what corporations and their political pals are doing to this once great country. Sadly, America's best days are now behind her.

[cyberpj]

13. kick.nt

[SoCalDem]

7. People all over the world know how to operate computers

and robots can answer the phones..
Who needs people anymore?

of course Walmart is there to offer cheap stuff that low wagers can "afford", so here's hoping eveyone enjoys the thrill-ride to the bottom:(

[barb162]

27. People won't be able to buy even at Wal-Mart of there are no

jobs here. People need to wake up and they aren't

[high density]

11. Yeah who needs to earn wages?

Isn't that what credit cards are for?

[Gregorian]

12. You know the irony of this?

Those who are the recipients of outsourcing aren't benefiting either.

The republicans have been working on Freedom® for quite a while now. It used to be that the tarrifs kept jobs at home. But they repealed them. And now the companies can profit like mad by using foreign cheap labor. I had to force myself from saying slave labor. So they make next to nothing, and "we" make nothing. That's a different "we" than the one you heard the republicans yapping about during the election cycles. We, we, we. funny how ambiguous a word we could be.

My mind is blank. I'm not sure what to do about all of this. I just know it's really stupid. When the dollar is all that counts, we all lose. We meaning everyone but the Man.

[The Anti-Neo Con]

14. So what do we do when we have 90% unemployment?

If it keeps getting like this, I have a feeling that the only people employed in America will be law enforcement/corrections because chronicaly unemployed people usually do turn to crime in order to survive, so the crime rate will be through the roof. Those are also some of the few jobs that CAN'T be outsourced. If someone's breaking into your house, you can't call someone in New Delhi to come take care of it for you.

[leesa]

16. Guess what? There won't be any law enforcement either because there

won't be anyone paying taxes to pay for these jobs. There will be some corporate blackshirts, but there will be a lot more "criminals", i.e., hungry, desperate people, then there will be Corporate Cops. It will be ugly.

[saigon68]

37. buy your guns now

while they are still legal

[Pavulon]

15. Market Forces

I sell robotic equipment, cutting equipment, etc. The second thing I say to a person after describing a product is that support for it is available in their language in their country (where true).

The company has figured out that guys running a CNC machine that cost a shitload of money do not want to talk to some guy in india reading a book. They want to talk to the guy who knows the equipment. When it screws up it is costing them money.

There is also the issue of national security. Many products that seem mundane, like software of all stripes, have national security implications. Lots of simple things that seem simple are dual use.

Customers hate offshore support. I do not buy products for my department that offshore unless there is no choice ( a Chinese product for example). There is almost always a choice.

[kineneb]

17. you got it

and one other thing no one here has mentioned...

What happens when shipping foreign-made products to the US becomes more expensive (think oil costs) than producing the object here?

The factories have been closed down; no one manufactures anything here anymore. Just look in the Christmas catalogs coming now to your homes... anything in them "made in the USA"? (This thought struck me as I was looking at such a catalog.)

Talk about national security- what happened to national economic security? Or was that sacrificed on the NeoCon/globalist altar?

[Hekate]

19. No more tax breaks for these *holes -- I wish

Y'know, if the corporate bosses feel no sense of responsibility for the people of the country that houses them and protects them with its military might, why on earth should our government reward them with tax breaks?

Unless, of course, the government itself is being run by these same corporate *holes.

Ya think?

Hekate
:argh:

[Haole Girl]

22. The Hackett Group...

...was an appropriate name for them. :sarcasm:

[alfredo]

23. We can sell hambergers to each other. Of course the person

taking the order will be in India. You just have to put the mustard catsup and pickle on the burger. Life is good.

[OhioChick]

24. Order-taking in India

is likely already in the works.

Next Outsourced Job: Fast Food Order Taker

McDonald's has begun outsourcing drive-through orders in 40 of its restaurants, using 125 workers at a call center in California and submitting orders back over the Internet.

The process saves "seconds" on each order. Workers make $6.75 an hour, get no health benefits and handle up to 95 orders an hour in a job that sounds like a workplace massacre in the making:

Ms. Vargas seems unfazed by her job, even though it involves being subjected to constant electronic scrutiny. Software tracks her productivity and speed, and every so often a red box pops up on her screen to test whether she is paying attention. She is expected to click on it within 1.75 seconds. In the break room, a computer screen lets employees know just how many minutes have elapsed since they left their workstations.

One of the dire predictions of the Lou Dobbs crowd is that Americans will be pushed into low paying service jobs because all of our white-collar work is being sent overseas. But McDonald's could just as easily take those orders from Bangalore, where by one estimate a college-educated call center employee earns $2.40 an hour.

http://www.cadenhead.org/workbench/news/2906/next-outsourced-job-fast-food-order-taker

[alfredo]

30. It's over folks, we have been cast aside.

All we are good for is birthing babies for their war machine.

[barb162]

25. Actually not; no one can afford them with no jobs

[alfredo]

36. Only one choice left

Eat the rich

[ckramer]

33. We can get rich by selling house to each other

So what's the problem?

LOL

[Yavin4]

38. You Nailed It

We will all sell over-valued housing to one another and get rich by borrowing bigger and bigger sums of money from the banks. No sweat.