more on automation and skilled jobs

Scott Marshall Scott at
Tue Sep 12 18:28:00 MDT 1995

An interesting article on the subject from the NYT.

____________<article begins below>__________________________

" Skilled Workers Watch Their Jobs Migrate Overseas - A Blow to Middle
Class " By: Keith Bradsher (_New York Times_, Aug 28, 1995)

Corporate America is getting a lot of work done on foreign shores - in
India, China, Singapore, Hong Kong, Taiwan, Brazil, Mexico and Australia
- but not by Americans. Educated locals in these countries are paid a
fraction of the cost (paid in the United States) to perform
high-technology tasks like designing sophisticated chips, equipment
design and computer-programming. Absence of other infrastructure are no
impediment to many of these activities. In most cases, what they need
is a private satellite link. High-speed communication links even make it
possible to use two teams (one in the United States and other overseas,
in a different time zone) together working on a software development
project, cutting development time by around 40 percent.

Millions of white-collar Americans are now experiencing the same global
wage pressure that their blue-collar counterparts have long faced. And
now they have to justify their higher wages with higher productivity.

"Many fears that the growing tendency of corporations to farm out tasks
to developing countries is widening the gap even further between the
rich and everybody else in American society by eliminating some
categories of high-skill, high-wage jobs that make-up the heart of the
middle class".

The article's author argues that " new jobs overseas do not necessarily
mean the elimination of jobs in the United States."  A number of these
companies which are expanding in the United States as well as abroad
"attribute their overseas moves in part to a scarcity of good engineers
in the United States."

According to experts quoted here some of the best-paid computer jobs -
requiring writing original programs for a customer's precise needs -
tend to be staying in the United States. What is being shipped overseas
are skilled tasks turned into routine work by rapidly evolving computer

Corporate America now shops on a worldwide basis for many tasks to stay
competitive. Some experts add that the economy based on ideas and
information does not require companies to keep their production units
close to market.

One economist argues that in a computer industry one witnesses "enormous
integration of the markets, and therefore a drag on the real wages here
of the semiskilled, of the computer programmers, of the skilled."

Describing one of the responses from software professionals to the above
situation, the author says, "For now, this increased foreign competition
has set off a political backlash in the United States. The Software
Professionals' Political Action Committee, a lobbying group in Austin,
Tex., wants to limit immigration visas for computer programmers." In
conclusion the author quotes economist Jagdish Bhagavati who argues that
"American companies will go wherever they can find the best deals."

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