Jobs Leaving Charlotte

I'm a Charlottean and a SAS programmer. Not too long ago, SAS programming was a marketable skill. Then it began to morph into business analysis, with less of an emphasis on programming. Now this - these SAS jobs, these business analyst positions are moving offshore. Okay, I can pretty much hear the gears grinding. "He's liberal, he's moaning about job loss, this is going to be another anti-globalization screed." And you would be wrong, at least partly.

I'm not opposed to a "global economy". I think that having a global pool of talent to apply to any problem will inevitably lead to better solutions to the problem. I think that since all human life is equally valuable, every human should have the same rights and privileges as every other person, be that freedom from repression or freedom to own a TiVo. If a programmer in India (or China or Mexico or Romania) is better than I am at some job, then by all means, he should get the gig.

Here's the first problem though. The salary levels those places are quite a bit lower than here. Thus, even if I am a better programmer than the person in India, I have to be so much better as to offset the salary difference. And while I'm pretty good, I'm not nearly that good. It is, in effect, a VERY uneven playing field. If I am going to compete with the programmer from India, I have to price myself competitively. If I do that, though, I am unable to afford to live in America.

This is the second problem. When a service provider, be it a programmer or a farmer or whatever, prices their labor, they price it at a level that will enable them to pay their expenses (housing, food, medical, etc.). In America, that price level is a whole lot higher than in India or wherever. So, when my Indian counterpart prices his labor, he is able to do it at a discount compared to mine.

The solution to this is not to make it more difficult to move work around the globe. I believe that as the world comes together, this worldwide distribution of work is a good and right thing. Imposing penalties for this movement will not change the dynamic, rather it will force whole companies to move offshore rather than just parts of their work. While there is an argument to be made that keeping a corporate shell in the U.S. while it's work is done overseas is no great thing, I think keeping corporations here has benefits. The solution, I think, is to accelerate the economic trend.

Ultimately, if jobs keep moving offshore, the supply of workers will far outstrip the demand. This will lead to a reduction in the cost of labor. As the cost of labor goes down, so does the buying power of the labor force. This will, eventually, lead to a decline in prices in the United States. This decline in prices will also be aided by the cheaper labor which will make the cost of goods go down. In time, prices and wages will stabilize worldwide. At that point in time, all service providers will be able to price their labor competitively. The playing field will be level and the demand for workers in America will once again rise. What is needed is some way to make this transition as painless as possible for those of us whose wages will be falling. We need to find a way to make the global stabilization of wages and prices happen very quickly or we need to consider the need to support people who are struggling while we wait for the stabilization to occur.

Now, having said that, there is a huge catch. Deflation (the lowering of prices, the opposite of inflation) is a huge economic bugaboo, one that I think is highly unlikely to happen voluntarily. So, the expectation must be for us to wait until such a time as workers wage demands in the rest of the world reach the same level as currently exists here. That may be quite some time in the future. It is, I think, incumbent upon organized labor to work toward unionizing those countries to combat the sorts of oppression (low wages, sweatshop conditions, child labor) that characterized the growth of industry in our country. Again, though, this is a struggle that will take quite some time.

Herein is the problem, the question for which I have no solution. In order to be competitive in the global economy, my cost of labor must be competitive with similarly skilled workers in that economy. If, however, I price my labor at that competitive level, I am utterly unable to afford to live. I think advocating the abolition of GATT, NAFTA and the WTO is the wrong solution. Hiding from a problem hardly makes the problem go away. I think we need to look very carefully at how we address wage and price disparities between the various countries involved in the global economy. Otherwise I think there will be a large and growing segment of discontented folks who have no jobs, or who have jobs that cannot support their families. That set of unhappy people has been, until now, largely uneducated and politically apathetic. As more white collar jobs are sent offshore, that demographic will shift, and that shift will then force the issue. It is better to deal with this now rather than later.