{"id":264,"date":"2006-02-23T15:38:24","date_gmt":"2006-02-23T20:38:24","guid":{"rendered":"http:\/\/esr.ibiblio.org\/?p=264"},"modified":"2006-02-23T15:42:12","modified_gmt":"2006-02-23T20:42:12","slug":"outsourcing-breeds-more-jobs","status":"publish","type":"post","link":"http:\/\/esr.ibiblio.org\/?p=264","title":{"rendered":"Outsourcing breeds more jobs"},"content":{"rendered":"<p>CNNMoney <a href='http:\/\/money.cnn.com\/2006\/02\/23\/news\/economy\/jobs_it_offshoring\/index.htm'>reports<\/a>:<\/p>\n<blockquote><p>\nDemand for technology workers in the United States continues to grow<br \/>\nin spite of American companies shifting more technology work overseas,<br \/>\naccording to a new study.\n<\/p><\/blockquote>\n<p>Sigh.  Is there, like, some cosmic law that reporters have to be<br \/>\npoisonously ignorant about economics?  Of <em>course<\/em> outsourcing<br \/>\nstimulates domestic demand.  Increases in efficiency and better<br \/>\nexploitation of comparative advantage <em>do<\/em> that.<\/p>\n<p>Maybe I&#8217;m just naive, but shouldn&#8217;t a reporter at a <em>business<br \/>\nnews channel<\/em> know better than to subscribe to the fixed-lump-of-labor<br \/>\nfallacy?<\/p>\n<p><!--more--><\/p>\n<blockquote><p>\nThe study cites estimates that between two to three percent of IT jobs<br \/>\nwill be lost annually to lower-wage developing countries through the<br \/>\nprocess known as offshoring. But it said the U.S. IT sector&#8217;s overall<br \/>\ngrowth should outpace that loss of jobs, expanding opportunities for<br \/>\nthose trained in fields such as software architecture, product design,<br \/>\nproject management and IT consulting.\n<\/p><\/blockquote>\n<p>Comparative advantage, kids.  That&#8217;s what it&#8217;s all about.  If<br \/>\nthere&#8217;s <em>any<\/em> way in which the average programming skillsets in<br \/>\nthe U.S. and India diverge, market pressure will sort jobs and push them<br \/>\nwhere they&#8217;re most efficiently performed.<\/p>\n<blockquote><p>\n&#8220;Despite all the publicity in the United States about jobs being lost<br \/>\nto India and China, the size of the IT employment market in the United<br \/>\nStates today is higher than it was at the height of the dot.com boom,&#8221;<br \/>\n[&#8230;] lower wage scales in India and China are not pushing down pay<br \/>\nfor U.S. IT workers. [&#8230;] IT workers have seen steady gains in<br \/>\naverage annual wages for different fields in the sector of between<br \/>\nabout two to five percent a year.\n<\/p><\/blockquote>\n<p>This is where libertarians like me get to gloat a bit, pump a fist<br \/>\nwhile shouting &#8220;laissez-faire!&#8221;, and point out that both left-wing<br \/>\nantiglobalization moonbats and right-wing isolationist\/protectionist<br \/>\nwingnuts that they are full of horse puckey up to here.  Welcome to free<br \/>\ntrade, making everybody richer exactly the way we expect it to do when<br \/>\ngovernments don&#8217;t piss in the soup because they think they&#8217;ll like the<br \/>\nflavor better.<\/p>\n<blockquote><p>\nThe study suggests that there are several factors in the continued<br \/>\ngrowth in demand for IT workers here. The report said part of it is<br \/>\ndue to the use of offshoring by U.S. companies, including start-up<br \/>\nfirms, to limit their costs and thus grow their businesses. That, in<br \/>\nturn, creates more opportunities here even as an increasing amount of<br \/>\nwork is done overseas.\n<\/p><\/blockquote>\n<p>And there it is. Offsharing grows businesses so they can find or<br \/>\ncreate more domestic opportunities.  That&#8217;s the invisible hand right<br \/>\nthere, giving a rude finger to every single &#8220;managed trade&#8221; idiot and<br \/>\nregulatory busybody on the planet.<\/p>\n<blockquote><p>\nThe study also said that companies from a variety of sectors in the<br \/>\neconomy continue to discover greater efficiency and more competitive<br \/>\noperations through investment in IT. The study therefore argues there<br \/>\nwill be continued growing demand for IT as underserved fields such as<br \/>\nhealth care, retail trade, construction, and certain services make<br \/>\ngreater investment in technology.\n<\/p><\/blockquote>\n<p>This means that IT is being substituted for other, more expensive<br \/>\ninputs of production (a kind of <a href='http:\/\/esr.ibiblio.org\/?p=262'>ephemeralization<\/a>).  As long<br \/>\nas that keeps happening, demand (and IT wages) will continue to<br \/>\nrise.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>CNNMoney reports: Demand for technology workers in the United States continues to grow in spite of American companies shifting more technology work overseas, according to a new study. Sigh. Is there, like, some cosmic law that reporters have to be poisonously ignorant about economics? Of course outsourcing stimulates domestic demand. Increases in efficiency and better&hellip; <a class=\"more-link\" href=\"http:\/\/esr.ibiblio.org\/?p=264\">Continue reading <span class=\"screen-reader-text\">Outsourcing breeds more jobs<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-264","post","type-post","status-publish","format-standard","hentry","category-politics","entry"],"_links":{"self":[{"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=\/wp\/v2\/posts\/264","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=264"}],"version-history":[{"count":0,"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=\/wp\/v2\/posts\/264\/revisions"}],"wp:attachment":[{"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=264"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=264"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/esr.ibiblio.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=264"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}