February 6th, 2004
“You're always putting off
what we could do today…
Who's right, who's wrong?
What have you done for me lately
Ooh ooh ooh yeah” – Janet Jackson, What Have You
Done For Me Lately?
On January 22nd, the U.S. Senate passed a
bill, still requiring presidential approval that would
prohibit government contractors from shifting work
not meaningful to the overall IT economy (less than 2%
of IT outsourcing would be affected), it is a very clear
statement to both the beleaguered technology workers in
and the growing IT middle class in
And it is very, very myopic and stupid from a global
Obviously in an election year, when the only thing not
roaring back in the economy is jobs, this bill is a
To me it is fascinating how we fail to learn from
recent history that the loss of “the bottom 20% of
software programmers jobs” (Charles Simonyi in
October) to overseas competition will be good for all of
us in the long run.
If you look at the steel industry, the auto
industry and the textile industry as examples in the
last half of the 20th century, menial,
repetitive jobs left the leading economies, re-vamping
old sunset industries through innovation and
cycle comes around and new jobs needing higher skills
and more pay abound in the economies that allow for this
Shumpeterian “creative destruction”.
Let’s use the software programmer as our example.
The US Bureau of Labour Statistics says that 2000
was the best year ever for the programmer (the vast
majority of which were in-house or consulting type
programmers, not application/ISV or embedded/firmware
programmers) as 700,000 Americans called it their full
time occupation. Now
the number is below 1994 levels as almost 100,000 of
them have left the career.
The largest single sector unemployment rate is
the programmer, currently at 7.1%.
Most other sectors have seen some jobs come back,
but it seems to be getting worse for the programmer.
The reason? Is
it just off-shore outsourcing?
sports a $10B a year export business in out-sourced
software programming worldwide.
Other Southeast Asian countries are scrambling
aboard this gravy train.
Eastern Europe and
are also making inroads.
Locally, we have at least three firms that I know
of that do a great business in outsourcing.
Are they evil job stealers? Do we need to pass
some laws quickly to prevent that revenue and those jobs
from leaving BC? Maybe
just call Tony Soprano and offer them some
“protection”? Ba-da bing Ba-da boom.
Thankfully, there hasn’t been a big deal made
of this locally.
This week at a conference in Mumbai (
took the opposite stance from the
and said that they will not ban outsourcing because the
tough competition from
will stimulate innovation and productivity gains that
will be good for the
also explained that the burgeoning middle class in
and elsewhere will fuel exports for other goods in other
is where the myopic
policy makes no sense at all.
If 1,000,000 Indian families can now buy
discretionary items because they have decent jobs, the
should benefit on the whole.
Re-training 100,000 US programmers to work in
other industries supplying the growing economies outside
the US (which the much weaker US dollar helps!!!) makes
a bit of sense, doesn’t it?
In the examples of other industries earlier last
century, the move to outsourcing always preceded some
great innovation that changed an industry.
In an Information Week e-mail exchange, Charles
Simonyi (employee number 40 or so at Microsoft), said
that high-value mechanization has followed big
His spin on this is that software is due for a
major change in automation and performance, making
modifications and bug fixing less likely as a means of
firm, Make Technologies is one of a few companies
looking to make software coding easier and more
has made it a corporate mantra to create self-healing
software and systems.
So there will be less programming jobs going
forward, but not due to outsourcing alone.
It will require less labour to make software
going forward. The
repetitive task programming can and should go off-shore
if people are willing to do it.
the individual micro perspective, the protectionist
attitude of the
makes sense. The
$80,000 a year job supporting a family disappearing to a
few $20,000 a year workers in
makes the individual here un-happy.
Such is the pain of policy making… the good of
the whole is not good for everyone.
And in an election year, pandering for votes is
is just a useful target for the anger today.
The reality is that, as always, technology is
changing and people in leading economies have to
The pain is not just in software programming.
are leaping ahead in contract manufacturing of hardware
From cell phones to LCD panels to X-boxes,
thousands of jobs have left
never to return. And sheer economics make it hard to
compete (which is why there is a lot of screaming about
de-coupling their currency from the dollar so that their
exports get more expensive in the
). I might
be a bit biased, but from where I sit, the investment in
R&D, both public and within private companies and
the commercialization of those innovations, largely
supported by angels and venture capitalists, is where
the future of technology jobs lay.
The world’s manufacturing floor can be
as long as we drive the design and implementation, we
can reap the profits that allow us to pay the higher
, will adopt a more entrepreneurial attitude and set of
policies for driving innovation in their countries.
US and European VCs have been investing in
companies that are not just out-sourcers in
, but rather innovators.
has a long way to go and a huge glut of educated workers
that can fill the role of outsourcers for now.
, with its more liberal immigration policies, can add
talented and innovative people from
that thirst for more opportunity and better paying jobs,
in the meantime (See… the brain drain works two
What I find fascinating to think and read about is what
and other countries like
grow their middle class of consumers.
These economies could become enormous because of
the sheer size of their populations.
The workers there will demand higher wages as
their lot in life improves. This will force those
nations to either emulate the North American style of
funding innovation and encouraging entrepreneurship or
stay as the “blue collar” workforce for other
innovative nations, losing their top talent to countries
Sachs has a great look forward at the next 50 years of
the so-called BRIC economies (The initials of the
aforementioned populous countries) and the possible
impacts to nations in the current G7.
is inevitable that these countries will get to be a part
of the IT economy more and more.
Wrapping yourself in the flag in the name of
protecting a few jobs is completely and utterly futile.
The smart entrepreneurs embrace the inevitable
trends and look for ways to exploit new opportunities.
The dumb ones make excuses and look for handouts.
Letters From Last Time -
column about asking for what we want. I enjoyed your
perspective. I'd like to direct your attention to a book
a read recently which deals with this very timely topic:
The Aladdin Factor. By Jack Canfield and Mark Victor
Hansen. Their premise is that anything is possible if
you dare to ask. And since these guys come from the
, I would think that this is more than a Canadian
dilemma - I believe most people have a problem asking
for what they want.
any rate, I've begun putting their advice into practice
and it's amazing what happens when we just ask.
I wonder if Canfield and Hansen will give you some royalties, Andrea.
Thanks for the tip, I’ll have a look.
I had no idea that this went on in business.
I spent about five years inconsistently learning
how to ask questions on a personal level.
Mostly because I read a lot of stuff, which
usually answers the questions through context instead of
factor is that I'm English and was conditioned as such
to not ask potentially painful or embarrassing
questions....usually the kind around money or feelings.
Another way to look at asking questions, besides 'this
is business', is of collecting information.
I've heard of situations where asking a question
was the same as accusing someone of something....or it
was taken as such. Asking
for information in that context works a lot better
because there's no emotional charge around the question.
There's another issue connected with doing business that
might be important: that of the practical person and the
think up the projects for the dreamer to build.
Dreamers like to work in 'maybes', because ideas
aren't concrete until they're finished.
people only want to deal with facts, finished thoughts.
For a dreamer to walk into a room filled with
practical people and pitch an idea that will work, but
cannot really be imagined by everyone else, is really
frightening.....and when the questions start, not being
able to answer them satisfactorily (which means with
certainty) is going to result in disaster.
Practical people need dreamers and dreamers need
practical people. We
just don't speak the same language.
No and yes are very much a part of that language.
I still enjoy the column, particularly ones like this.
I agree, Roger, that some people are just not emotionally constructed
to “ask”. They
should realize their own capabilities and hand off
important “ask” situations to the more practical and
adept workers who are not afraid to ask.
Thanks for your support all the way from the jolly
What Do You Think? Talk
Back To Brent Holliday
Something Ventured is a bi-weekly column designed
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