How Many American Jobs Are Really Lost to Outsourcing?

[Knight Templar]

I've tried to find out because this is possibly going to be a major issue in the 2012 presidential campaign.

I've googled the subject and gone through half a dozen sites and I get everything from "about 50,000 a year" to "several million".

At any rate the number seems to be a relatively small percentage of the total number of unemployed.

 

[thestrangequark]

Is that a badger in your avatar? Because now I can't get that "Badger, badger, badger, badger, badger, badger, badger" thing out of my head.

 

[Robert Maxwell]

This site offers various numbers, including estimates of existing jobs lost, companies that have outsourced the most jobs, and projections on future losses.

 

[thestrangequark]

^That was an interesting article. Thanks for posting.

 

[Knight Templar]

This site offers various numbers, including estimates of existing jobs lost, companies that have outsourced the most jobs, and projections on future losses.

I've seen the site but the data looks like it was compiled around 2005 which is not that useful.

 

[Robert Maxwell]

This site offers various numbers, including estimates of existing jobs lost, companies that have outsourced the most jobs, and projections on future losses.

I've seen the site but the data looks like it was compiled around 2005 which is not that useful.

Well, that's basically all you're going to get, because there is no one tracking those figures on an ongoing basis at a national level. You can find outsourcing data for various public companies, but that's about it.

 

[Knight Templar]

This site offers various numbers, including estimates of existing jobs lost, companies that have outsourced the most jobs, and projections on future losses.

I've seen the site but the data looks like it was compiled around 2005 which is not that useful.

Well, that's basically all you're going to get, because there is no one tracking those figures on an ongoing basis at a national level. You can find outsourcing data for various public companies, but that's about it.

I would think given the prominence and volatility of this issue that more organizations would make an effort to track and analyze the data.

 

[Robert Maxwell]

I've seen the site but the data looks like it was compiled around 2005 which is not that useful.

Well, that's basically all you're going to get, because there is no one tracking those figures on an ongoing basis at a national level. You can find outsourcing data for various public companies, but that's about it.

I would think given the prominence and volatility of this issue that more organizations would make an effort to track and analyze the data.

How is the US government going to track hiring done outside US borders? Derrrrrrr.

 

[Knight Templar]

well, I was thinking more about organizations like the Chamber of Commerce or a magazine like Forbes or Business Week.

But I do see how hard it could be to define "outsourcing".

For example, say a company with a factory in Illinois that employees 500 people opens a new factory in Mexico that employees 300.

Two years later the recession hits and the company elects to close its Illinois plant and keep the one in Mexico open. After all it is newer with better equipment and excess capacity.

A year after that business picks up again and the company simply elects to increase capacity at the plant in Mexico and hire an additional 100 employees.

Would that be defined as "outsourcing"?

 

[gturner]

The Bureau of Labor Statistics would probably be the best fit for an organization to try and track it.

We should also keep the distinction between "outsourcing" and "offshoring". When a company quits trying to run its cafeteria internally and hires another company to run the food services, it is outsourcing.

 

[Leviathan]

Good article posted - thanks.

"The real truth about the impact of outsourcing is still difficult to determine."

Not for those of us on the ground. In the past year I have been to 12 customer sites who have used IT offshoring. All 12....every single one...have complained of under-qualified staff sold as "Senior" level, overbilled hours and underwhelming project results.

It's a destroyer of economic opportunity for both the host and parasite company - the host loses its project, the parasite loses its reputation.

No actual jobs are created they are simply being relabeled and shipped offshore. The end result is a counterfeiting scheme that ruins the value of doing good work - you don't get ahead buy being the best/cheapest...you get ahead because of a lie.

I currently have hands-on experience with 8 instances of the host company's patents being infringed by the offshore company.

last but not least...offshore jobs pay no income taxes to the parent country.

...the only good thing they have done is knock off the dumbass unions.

...let me say this to all you senior exec's and MBA'S who drink the koolaid on offshoring: PLEASE KEEP OFFSHORING! We are getting rich cleaning up the mess you untrained shaved apes create!

 

[Mr Silver]

But what about those who would rather management kept ordering catering lunches from somewhere cool like Subway rather than suffer through an on-site canteen...?

 

[gturner]

^ Very true.

When I was working at a Michelin tire plant in Oklahoma, all the workers were bitching about the coffee situation and bringing one or two thermoses from home. Management had changed snack vendors and the new contract said that personal (or departmental) coffee pots weren't allowed, so the workers either had to drink the swill out of the vending machines or bring their own. They certainly, and vocally, objected to outsourcing the coffee.

Neiman-Marcus in Irvin TX had a great cafeteria, but the quality dropped somehwat when they outsourced it

Nike-Memphis outsources their cafeteria, and the company that runs it has it set up like a food court. IBM in Research Triangle Park also goes with the food court model, which I think was run internally, but most of the engineers would run out to a gas station deli.

The best outsourced factory cafeteria I've eaten in is in an Owens-Brockway glass bottle factory in the City of Industry, near downtown LA. The cafeteria was run by a Korean family who could cook anything. Their Mexican food was so good that Mexicans deported themselves in shame. The family ran food services for several plants and were using it as a stepping stone toward opening their own restaurant. So every day I'd sit and eat with a bunch of maintence workers and engineers (glassplants really don't have anyone else) in greasy blue uniforms and hair nets, while LA fashion models from somewhere nearby would walk in off the street and pick up to-go orders. When fashion models walk into a glass factory for the cafeteria food, you have hit outsourcing nirvana.

 

[scotpens]

. . . When fashion models walk into a glass factory for the cafeteria food, you have hit outsourcing nirvana.

I call bullshit. Everyone knows fashion models don't eat!

 

[gturner]

^The models were normal weight to slightly chubby. From what the maintenance guys said, the agency down the street primarily did newspaper-type ads for normal people, which is probably why it was in the City of Industry instead of someplace a bit more upscale.

But I have a worse case of maintenance mismatch for you. Neiman Marcus Direct moved their buyers (hot, young, rich, fashion majors) to a building a few blocks from their distribution center in Las Colinas. The girls dress to the nines every day (to outdo each other) and work in a building that seems to be devoid of a single man. When anything goes wrong, like a clogged toilet, some babe gets on the phone with corporate downtown and either bitches or cries, and an executive vice president or some such calls the maintenance guys at the distribution center nearby. Even if they're in the middle of tearing apart their slat sorter, they have to drop everything and head over to take care of the buyers.

So when the maintenance guys go over there, they get tortured by really bored, high-maintenance fashion types. Sometimes some of the girls will accidentally drop a file right in front of the maintenance guy, say "oopsie", and while facing the other way, bend alllll the way over to pick it up.

 

[SmoothieX]

Neiman-Marcus in Irvin TX had a great cafeteria, but the quality dropped somehwat when they outsourced it

Nike-Memphis outsources their cafeteria, and the company that runs it has it set up like a food court. IBM in Research Triangle Park also goes with the food court model, which I think was run internally, but most of the engineers would run out to a gas station deli.

That's not outsourcing, that's contracting with a food vendor. They do that all over the place. My college used Marriott for example. Sporting venue, parks, etc.

Outsourcing would be if the guys making my lunch were in China and barged it over.

 

[Hoser]

When I started working in 04 at an automotive supplier, I remember seeing the shipping signs going out to factories in NY state, MI, and Indiana. Now I think we have one factory to ship to in NY, and the majority goes to Mexico.

 

[STR]

For every job outsourced, several have been automated. Assembly lines with hundreds have been replaced by robots and a few service techs. Bank tellers, often 2-3 per bank at small banks, have been replaced by ATM's and a service tech who handles dozens of banks. It may shock people used to the "China makes every thing" mantra to find out that (in terms of dollar value) America manufactures more now than it ever has in its history. It just uses a lot less people to do it.

The difference is that the automated jobs are never coming back. The conceptual and cutting edge stuff never really left the borders. The less cutting edge stuff, and things more complex than sewing t-shirts together, are starting to come back as inflation/cost of living/cost of doing business (including intellectual property theft and 3 month lag times to physically move goods across the Pacific Ocean) make outsourcing not worth it. However, WHEN the factories come back, they will NOT be using as many workers. Expect to hear about the "dying" US manufacturing industry for the rest of your lives, even when it's making twice as much stuff as it does now and is actually exporting MORE to China than it's importing.

Learn people skills, learn healthcare, learn to physically fix things, learn to design, or learn how to protect things. Everything else is at-risk.

 

[SmoothieX]

Learn people skills, learn healthcare, learn to physically fix things, learn to design, or learn how to protect things. Everything else is at-risk.

I am a civil engineer, so designing stuff is a major point of my job. It's not a profession that can really be outsourced. But unfortunately, it is an industry that is dependent on a thriving construction industry. Hence I've been on government cheddar the last few weeks. There are only so many leaky sewers you can fix to keep the lights on if nothing substantial is being built.

Public sector work is where it's at right now as far as construction.

 

[gturner]

Neiman-Marcus in Irvin TX had a great cafeteria, but the quality dropped somehwat when they outsourced it

Nike-Memphis outsources their cafeteria, and the company that runs it has it set up like a food court. IBM in Research Triangle Park also goes with the food court model, which I think was run internally, but most of the engineers would run out to a gas station deli.

That's not outsourcing, that's contracting with a food vendor. They do that all over the place. My college used Marriott for example. Sporting venue, parks, etc.

Outsourcing would be if the guys making my lunch were in China and barged it over.

No, that is outsourcing, and is where the term came from.

Outsourcing: verb
1. Obtain (goods or a service) from an outside supplier, esp. in place of an internal source.
2. Contract (work) out.

What you're thinking of is "offshoring", which is outsourcing to a country overseas, a term that can cause confusion of its own because Mexico isn't in Europe or Asia.