Employee-Driven Outsourcing

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This is precious: Gene Healy spots a Times of India story from last month reporting that some programmers are now outsourcing their own jobs to Indian programmers at a fraction of the cost. They can work four jobs putting in only a few supervisory hours and pocket the bulk of four paychecks. I await the loud denunciations of Benedict Arnold workers betraying themselves.

Addendum: Given how thinly sourced the story itself is, I should probably add that this might well be bogus—it has a whiff of "too funny to be true" about it.

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  1. And at Wired.com there is an article about online videogame players outsourcing tasks to players in China and Russia. (thanks Geekpress.com)

    http://www.wired.com/news/digiwood/0,1412,64638,00.html?tw=wn_tophead_2

  2. They can work four jobs putting in only a few supervisory hours and pocket the bulk of four paychecks.

    Which means, of course, that they are being far more productive. And Kerry wants to limit outsourcing…Ha! The best thing to do is to cut the corporate tax rate. Our average is 40% while the average of the top 25 industrial nations is 30%

    There was a bill in congress to cut the rate somewhat and offset the anticipated revenue loss with cuts in corporate subsidies. The bill was sans white house support (or opposition) and it barley lost. Contact your representative and senators and tell them that it’s the right thing to do:

    http://www.visi.com/juan/congress/

  3. At some point the Indian programmers being outsourced to will realize that their bosses are pocketing 4 paychecks, and will approach the people hiring their bosses and say “Hire me directly and eliminate the middle-man!”

    I have no doubt that some of the entrepreneurial programmers will loudly cry out of protectionist laws. “Nobody outsources my job but ME!”

  4. Just wait ’til Amway gets over there, if they aren’t already.

  5. Who says you can’t import a haircut?

  6. Thoreau’s right. Hopefully they’re learning valuable skills for starting an outsourcing management company or else they’re just dinosaurs enjoying the grazing as the asteroid nears. And when the asteroid hits, the anti-outsourcing crowd will cry that they were Benedict Arnolds who helped show their employers the way to their own demise. But of course, that’s likely to happen either way, and in the meantime, hopefully they’re learning something they can use once their employers see the light.

  7. Who says you can’t import a haircut?

    Isn’t that what the Donald does? 🙂

  8. thoreau: There’s no point. The workers may get wise and find local-area jobs but they aren’t going to fly to the US to meet with small businesses of 10 to 40 people. And many in those small-business prefer having a local presence and someone of similar ethnicity.

    These are independant contractors, small businesses unto themselves that are doing this — far removed from Fortune 500 CEOs.

  9. Damn self-hating employees.

  10. Did they Outsource to China? Now, that would be funny!

  11. thoreau: There’s no point. The workers may get wise and find local-area jobs but they aren’t going to fly to the US to meet with small businesses of 10 to 40 people. And many in those small-business prefer having a local presence and someone of similar ethnicity.

    There are web sites (on the Internet) where employers post jobs and people bid on them. Many of the bidders offer to do it for a low price and over – once again – that Internet thing.

    Some things can certainly only be done with physical presence, but – believe it or not – I could log into a computer in Bangalore and make my screen look just like the screen in Bangalore.

    As for the outsourcers, what are their jobs now? Are they programmers, or are they managers? Clearly, they’re the latter. So, they’re getting good at management while their programming skills dwindle.

    Technology mercilessly marches on. I realize this might be difficult for, say, a writer to understand, but the companies that produce the products programmers use don’t sleep. Every week MS, Sun, Oracle et al churns out some new version or programming API that programmers need to know about to do their job.

    Here’s a tangible example. What if one of these programmers seeks a contract or full-time job? What is their resume going to look like? If a job requires 2 years of recent Oracle experience, what are they going to say? “Well, I don’t have that experience, but I did supervise those who did the work.” So, they better hope those management jobs keep working, otherwise they’re going to have problem finding work as programmers.

    Now, what if we start sending many of our programming jobs overseas. Those overseas programmers will be the ones with the recent skills, while American workers will lag behind.

    Programming isn’t like making buggy whips. It’s not going to be obsolete any time in the next several decades.

    What the Kato Krowd is setting us up for is being reliant on foreigners to write the software for our machines, and that’s not a good long-term policy.

  12. Lonewacko,

    If programming skills were so purely learned from on the job experience, how come foreigners were able to snatch jobs away from Americans in the first place? However they did it, Americans can do the same when the foreigners start expecting more money and lose their comparative advantage. Your apocalyptic forecast of permanent job exportation is silly.

  13. I’ve heard about something like this (guy working from home outsources own job, keeps difference) on Slashdot, but it was supposedly a hoax or urban legend.

    fyodor writes: “If programming skills were so purely learned from on the job experience, how come foreigners were able to snatch jobs away from Americans in the first place?”

    They snatched them because they’re cheap workers.

  14. Jon H,

    “They snatched them because they’re cheap workers.”

    Well, as they say, duh. But hopefully we can agree that the even the cheapest worker in the world can’t compete if he can’t do the job. So obviously foreigners who are hired as programmers in place of Americans are deemed to have sufficient programming skills for their jobs. However they gained these skills (school, internship, self-teaching, what have you) Americans can surely do as well. Thus, Lonewacko’s fearmongering scenario of outsourcing being a permanent self-perpetuating jump off a cliff is just silly.

  15. fyodor: Yeah, I’m going to explain software development to you. Here’s an example: when mechanics go to Goodwrench Academy, they learn what a camshaft is. And, they learn what types of camshafts have been used in the past. However, each year each maker comes out with several new models, and each of those has a slightly different type of camshaft/assembly. It’s like that, but more complicated.

    But, none of this matters, but I’ve just invented a wonderful way to solve all this bickering about outsourcing, mass immigration, and the like.

    We simply hold people – and their descendents – responsible for their actions.

    For instance, maybe reparations aren’t such a bad idea after all.

    What if the North had said to the South, “OK, you can have your slavery. However, all you plantation owners – and anyone else who supports or profits directly from slavery – shall be held responsible for your actions. And, that will apply to your descendents as well. In fact, we’re going to implant you with RFID chips so we can make sure to find you when the shiat hits the fan.”

    And, best of all, it would have been a market solution.

  16. I have no idea what slavery reparations and the civil war have to do with outsourcing programming jobs to India. But I’m sure Lonewacko will enlighten us all.

  17. camshafts?

    What on earth are you trying to say? That software and the tools to make software evolve? Sure, but so what?

    Also, please explain the reparations/outsourcing connnection.

  18. Lonewacko-

    You are perceiving just one aspect of a much larger conspiracy. The goal of looser immigration policies is not a Mexican Reconquista of the US. That’s just a smoke screen to hide the true goal: The importation of as many Catholic voters as possible so that we can install the Pope as President of the US and banish Protestants and atheists to concentration camps!

    But we can’t do it without the help of programmers from abroad. That’s why the only non-Catholics exempt from the concentration camps will be Hindus, Muslims, Sikhs, Jainists, and Buddhists. Oh, and Eastern Orthodox Christians, because they’re down with our basic approach, minus the icons of course.

    Join me in rapping the praises of our soon-to-be leader, John Paul Two: “I’m down with JPT, yeah you know me!”

  19. I understood what you were saying about programming the first time, Lonewacko. But you have yet to explain how foreigners could have successfully competed with employed Americans in the first place if learning programming on the job gives a worker such an insurmountable advantage over those without a programming job.

  20. thoreau writes: “I have no idea what slavery reparations and the civil war have to do with outsourcing programming jobs to India.”

    Try reading it through a few times. It’s a bit of a Swiftian thing about people being held responsible for what they espouse. Slavery was used as an example of a bad idea that some supported for their own benefit.

    thoreau writes: “[strawman un-funny joke, risks being ignored]”

    fyoder continues wanting me to explain complicated matters to him. Here’s an example you might be able to understand. “You want a young doctor and an old lawyer.” The young doctor knows all the new info. Or, consider CEB. Each year, lawyers and other professionals have to pass a few courses to make sure their skills and knowledge are up to date. If a lawyer doesn’t keep up with the latest laws, he might be in trouble.

    But, that’s long-term. Foreigners got the jobs by being cheaper even if they were worse. I worked on a project with 10 other people, most cheap foreigners. I ended up designing and writing almost half of the software.

    But, they’re getting better. And, if they’re the ones who get the jobs they’re going to be the ones with the latest, more marketable skills.

  21. I also understood what Lonewacko was saying the first time about software programming, but I really wonder if Lonewacko has ever outsourced programming work.

    I have. We had a situation at our company where we had more work than programmer hours and so offhored the work.

    It was not a good experience. First off, our project managers are lazy sons and daughters of bitches who treated our requests for documentation as lazy whining. It was fun to watch them freak out when the offshoring firm said “yes, we’ve seen the proposal, now where are the requirements?”

    Unfortunately they then came up with a solution that was something I might have done four or five years ago, and it had performance problems out the wazoo. Their comments were in their native language so most of our programmers couldn’t figure out what they were. (I could, because I speak a related language.)

    Even when they had adequately detailed requirements, the language barrier was a problem and things simply weren’t done or were done in some bizarre way that made the result not terribly useful.

    We used them a couple of times more on simpler projects but have ceased because the quality just isn’t up to snuff. The PMs aren’t happy, the programmers who have to implement changes that come up after delivery aren’t happy, and hence upper management isn’t happy.

    As a result, I have a nice, warm feeling around my backside. And my managers now actually give me requirements, so I’m thrilled.

    Bring it on. I can learn new APIs, but between our contractors and our offshoring, I realize I’ve learned a lot about programming that doesn’t come in API documentation.

  22. thoreau: I always call him JP Deuce. If only he can hang on to take the throne. Long live The Deuce!

  23. but I really wonder if Lonewacko has ever outsourced programming work.

    I haven’t and I didn’t say I did. The Bangalore example was perhaps badly chosen; I should have used someone else in Bangalore or me communicating with Ice Station Zebra.

  24. fyodor writes: ” But you have yet to explain how foreigners could have successfully competed with employed Americans in the first place if learning programming on the job gives a worker such an insurmountable advantage over those without a programming job.”

    Speaking from experience, it’s really, really, really hard to get a programming job in the US when you don’t have paid work experience in the desired skill, unless you’re a fresh graduate (and then it’s not easy).

    The worst place to be is 30 years old with outdated skills and/or not-quite-enough work experience with what companies are hiring for. Actually, no, I’m sure it’s worse to be in that position at 40 or 50 or 60.

    You can take classes, you can work your way through every Java book on the market, but that isn’t likely to count for much. Certainly not with HR. So it’s very, very, very difficult to fill in the weaknesses in your resume.

    If you’re lucky, you’ve participated in some kind of open source project or developed a program that gets some attention, and you can get a contact with a technical person inside a company who would be familiar with that work.

    But companies aren’t interested in training people. Companies looking for the perfect candidate will leave a position open for longer than it would have taken to bring an unexperienced person up to speed.

  25. I was in software development a few years ago, and my company was early to the offshore programming party. We actually bought a company in India, and it?s my understanding that they take contracts from other American software companies.

    You do understand, Wacko, that American companies can and do engage in this practice to the benefit of American employees, American investors, American taxpayers and American consumers, don?t you?

    We were one of the first in our industry to use XML. You can plug just about anything you want into the back end, and it works like a charm. There was a jump in ability that the QC people had to make, but once they started integrating properly vetted code in conjunction with the GUI people, the end users never knew the difference.

    But our accountants sure did.

    We cut the license fees for our product, and we were able to get rid of a lot of the dead wood that had stacked up in the cubicles over the years. There wasn’t as much money to be made in the company; at least, it wasn?t like it used to be. Thank God! I changed industries, and now I’m working in an industry that compensates me much better than what I would have gotten if I had stayed in the software industry.

    Our users saved tons of cash, and so did their customers, mostly American consumers although some of them may have been illegal aliens.

    So the only losers were the dead wood. If somebody’s gonna lose, shouldn’t it be the dead wood, Wacko?

    Americans or not, there’s three kinds of workers: those who are more valuable than they are expensive, those who are about to get the axe, and the parasites who work for unions or the government. The majority of the people in the last category are not illegal aliens. If you’ve got a plan to deal with these parasites, I’d love to hear about it Lone Wacko…

    …so long as it’s Constitutional.

  26. Companies looking for the perfect candidate will leave a position open for longer than it would have taken to bring an unexperienced person up to speed.

    Or, on a related note, they’ll add ten extra buzzwords and create an impossible-to-fill requirement. Then, they can show they tried to hire a U.S. citizen and it failed. Imagine that! Guess they really need all those H1-Bs.

    Hey Ken: please provide me with no more than three sentences explaining which workers did which work using which technologies. And, if you don’t understand the immigration issue, please don’t insert references to it like you have Touret’s Syndrome. Thanks!

  27. Let’s try this again: “Hey Ken: please provide me with no more than three sentences explaining which workers did which work using which technologies.”

    Ken & fyoder: Frequently at Reason I feel like I’m addressing third-graders. It’s difficult to talk to people about subjects they know very little about.

    But, in the case of fyoder’s last comment, I’ll make another try.

    You are contacted by Magical Offshore Programmers in Mombai. They say they’ll do your project for a low price. You send them the specifications, and they perform the work and send you the software. You had a contract with them saying that they would do such and such and they’d receive their money. If they didn’t do what they said, they wouldn’t get money. They could have been BSing the experience of all the people at their company, but it wouldn’t matter: it was a pass or fail proposition for you the buyer. If they failed, they wouldn’t get paid.

    That’s different from a single, sole, solitary programmer who goes to a company seeking a job. The person who interviews that person will ask how much experience that person has in various technologies and how recent that is.

    Let’s imagine that tomorrow all programming jobs will be outsourced for a one year period. The offshore programmers will be the ones with the recent experience, and the homegrown programmers will have gaps in their resumes. Not everything is going to be outsourced of course, but if you can wrap your mind around what would happen in that one-year period you can see the danger involved in sending “recent experience” offshore.

    And, Ken, once again, please answer the question.

    Also, for everyone’s education, here’s an informative link about Ken’s affliction: Reading the 9/11 Commission Staff Reports: Chapter 3: Although there is evidence that some land and sea border entries without inspection occurred, these conspirators mainly subverted the legal entry system by entering at airports.4 In doing so, they relied on a wide variety of fraudulent documents, on aliases, and on government corruption. Because terrorist operations were not suicide missions in the early to mid-1990s, once in the United States terrorists and their supporters tried to get legal immigration status that would permit them to remain here, primarily by committing serial, or repeated, immigration fraud, by claiming political asylum, and by marrying Americans. Many of these tactics would remain largely unchanged and undetected throughout the 1990s and up to the 9/11 attack. Thus, abuse of the immigration system and a lack of interior immigration enforcement were unwittingly working together to support terrorist activity.

    Those of us who know what we’re talking about don’t consider this a funny subject.

  28. “Hey Ken: please provide me with no more than three sentences explaining which workers did which work using which technologies.”

    Sentence One: What is this, Name That Tune?

    Sentence Two: Are you trying to suggest that neither my old company nor other American companies are offshoring successfully?

    Sentence Three: Thanks for the laugh.

    “And, if you don’t understand the immigration issue, please don’t insert references to it like you have Touret’s Syndrome. Thanks!”

    Fe Fe Fear?Fear of foreigners! Has it occurred to you that one of the reasons offshoring has taken hold is because of the stupidity of the immigration laws we have? Xe Xe Xe?Xenophobia! If not understanding why the government should be able to make decisions about who I can and can’t hire at my own company, then I guess I don’t understand the immigration issue. Do?Do?Don?t?Don?t make fun of my disability!

  29. Lonewacko, I never asked you to explain anything complicated to me at all. In fact, what you’re saying, and what Jon takes great pains to corroborate, is, as they say, hardly rocket science. On the job experience is a big advantage. Well, gee, duh. OF COURSE on the job experience is a big advantage! But you paint it as such an unsurmountable advantage that once programming jobs are outsourced, foreigners will have a permanent, self-perpetuating hold on such jobs and Americans will be forever shut out. That’s what’s silly and is what is contradicted by the fact that such jobs have been given to foreigners without experience over Americans WITH experience in the first place. Of course there are other factors, but then there always are. You can make it as complicated as you like, but it’s all right there in pretty plain language.

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