Is Outsourcing Paid Slavery?
This is not just something that popped into my head out of the blue. I have been thinking about this for a while. If you live in India like me, and have seen the way some of the offshore/outsourcing development centers work, you might just be inclined to agree with the thought. I have a friend who has been working at least one day of almost every weekend ever since he joined his current company about 6 months ago (If you are reading this, I am talking about you Andy). He gets paid about 1/10th of the salary even the most inexperienced tech sector worker can expect in the West, and he doesn't even get paid any overtime for the weekends he works. On top of that, if you speak to any software engineer working in an Indian company (or the offshore branch of a foreign company) you will find that they spend a significant amount of time over and above what they are paid for in the office everyday!
When slavery first started, the main purpose behind it was not to oppress other people. That was just a side-effect. The main purpose was to get things done that the slave owners did not want to do or were not capable of doing. I see the same sort of thing happening in many call centers all over India. It is a job most people in the west would not enjoy doing, whereas they're more than happy if we can do it for them at a lower cost. What that means is that a significant part of Delhi's (and other Indian cities) population works at times when the wages charged would be double in most developed countries. What these companies are taking advantage of is the extremely outdated and colonial labor laws that this country still follows.
There can be any number of examples of the gross exploitation of human resources that goes on in India (and I suspect in most other developing countries). Somehow, issues such as these never seem to recieve the kind of PR that the outsourcing backlash does. I see the twin issues of labor exploitation in developing countries and the outsourcing backlash as two sides of the same coin. The problem is, that the people who are losing their jobs in western countries to lower wage earners are targetting their anger at the wrong people. Instead of hitting out at the people of these countries or the companies who generate employment for them, they should really be making efforts to target the governments of developing nations.
Even if the government of India suddenly wakes up one day and decides to change its abysmally bad labor policies, the corporates will probably just pick up shop and move to the next cheap destination. What is needed here is an honest effort to raise the standard of living in all developing countries at a uniform pace. This, of course, is one of the objectives of the WTO. Once again, this critically important objective seems to have been side-stepped in order to benefit some of the most developed nations in the world. What they don't realise of course is that by ignoring the standard of living of the children they chose to sell coca-cola to, they are simply shooting themselves in the foot.
It is true that the raising of living standards in developing countries will not really stem the outsourcing/offshoring wave. Salaries are still likely to be at least 3 or 4 orders of magnitude higher in the west than in countries like India. But this change is certainly likely to slow down the flow and bring it inline with the populations of these countries. More importantly, this will give the developing countries the chance to develop their own local markets for products like software and call center services. Right now, very few companies in India seem interested in picking up government/local projects because the outsourcing market is so much more lucrative.
In the end, it all does come down to population though. The fact that populations in most developed countries are leaning towards the senior citizen demographic means that there is no way to avoid giving work to countries like India. If living standards in India and other developing countries go up, this pendulum is likely to swing the other way in a generation or two. Think about it. In a couple of generations, Indians might actually be outsourcing work to the US. I wonder if they'll call it outsourcing then :)
As usual, I'd like to have comments from anybody who's reading.
This is not just something that popped into my head out of the blue. I have been thinking about this for a while. If you live in India like me, and have seen the way some of the offshore/outsourcing development centers work, you might just be inclined to agree with the thought. I have a friend who has been working at least one day of almost every weekend ever since he joined his current company about 6 months ago (If you are reading this, I am talking about you Andy). He gets paid about 1/10th of the salary even the most inexperienced tech sector worker can expect in the West, and he doesn't even get paid any overtime for the weekends he works. On top of that, if you speak to any software engineer working in an Indian company (or the offshore branch of a foreign company) you will find that they spend a significant amount of time over and above what they are paid for in the office everyday!
When slavery first started, the main purpose behind it was not to oppress other people. That was just a side-effect. The main purpose was to get things done that the slave owners did not want to do or were not capable of doing. I see the same sort of thing happening in many call centers all over India. It is a job most people in the west would not enjoy doing, whereas they're more than happy if we can do it for them at a lower cost. What that means is that a significant part of Delhi's (and other Indian cities) population works at times when the wages charged would be double in most developed countries. What these companies are taking advantage of is the extremely outdated and colonial labor laws that this country still follows.
There can be any number of examples of the gross exploitation of human resources that goes on in India (and I suspect in most other developing countries). Somehow, issues such as these never seem to recieve the kind of PR that the outsourcing backlash does. I see the twin issues of labor exploitation in developing countries and the outsourcing backlash as two sides of the same coin. The problem is, that the people who are losing their jobs in western countries to lower wage earners are targetting their anger at the wrong people. Instead of hitting out at the people of these countries or the companies who generate employment for them, they should really be making efforts to target the governments of developing nations.
Even if the government of India suddenly wakes up one day and decides to change its abysmally bad labor policies, the corporates will probably just pick up shop and move to the next cheap destination. What is needed here is an honest effort to raise the standard of living in all developing countries at a uniform pace. This, of course, is one of the objectives of the WTO. Once again, this critically important objective seems to have been side-stepped in order to benefit some of the most developed nations in the world. What they don't realise of course is that by ignoring the standard of living of the children they chose to sell coca-cola to, they are simply shooting themselves in the foot.
It is true that the raising of living standards in developing countries will not really stem the outsourcing/offshoring wave. Salaries are still likely to be at least 3 or 4 orders of magnitude higher in the west than in countries like India. But this change is certainly likely to slow down the flow and bring it inline with the populations of these countries. More importantly, this will give the developing countries the chance to develop their own local markets for products like software and call center services. Right now, very few companies in India seem interested in picking up government/local projects because the outsourcing market is so much more lucrative.
In the end, it all does come down to population though. The fact that populations in most developed countries are leaning towards the senior citizen demographic means that there is no way to avoid giving work to countries like India. If living standards in India and other developing countries go up, this pendulum is likely to swing the other way in a generation or two. Think about it. In a couple of generations, Indians might actually be outsourcing work to the US. I wonder if they'll call it outsourcing then :)
As usual, I'd like to have comments from anybody who's reading.
posted by Arun at 12:34 PM
7 Comments:
michael moore should do a move on this stuff.
I am sure you mean movie. And why not an Indian director. I am sure that an Indian would see the reality of this much more clearly. Besides, Michael Moore is more influenced by Hollywood than he'd like us to believe. He sensationalises stuff too much.
where is my indian airline ad post? :)
Couldn't come up with anything on that. Will write about it when i feel like it.
Damn it I've been working here for about 10 months now !!.
I dont agree completely with your comparison of slavery and outsourcing . I feel the comparison is too extreme. Though I do agree with on the point that we in India have terrible labor laws.
I think the main driving factor of outsourcing is money and skill. Like you rightly pointed out a guy doing my job in the west would be earning 10 times (or maybe more) but that means the resource is 10 times more expensive as compared to me (from the companies point of view). Its much cheaper for companies to outsource, another big factor is they dont have to hire a person for a particular project. With labor laws being strict abroad the hire and fire policy is expensive for the company. If a project is outsourced , youre not bothered what happens to the developers once the product is delivered, all you're concerned with is the ocmpany that made it and they manage rest of the mess.
If you think about it people working in call centers do get paid well (by indian standards). A guy who has just done a simple graduation can earn upwards of 15k / month. Now that kind of salary is very hard to come by in so many sectors.
Even if the standard of living increases, projects will continue to be outsourced to India because we have a huge population who is willing to work for less. I feel the only way things can be straightened out a bit by improving labor laws cause that'll impose some responsibility and accountability on the companies.
You probably guessed I posted the previous reply.
Andy
Yes Anonymous. I know who you are. (Isn't irony sweet!)
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