- It's a pity that no Canadian corporate executive has
been indiscreet enough to say, as one Microsoft honcho did recently to
his staff, "Think India ... pick something to move off-shore today."
-
- Or, again, that no Canadian business type has been indiscreet
in the same style as Tom Lynch, IBM's director for global employee relations,
who in response to reports IBM may move more than 4,000 jobs overseas,
said: "Our competitors are doing it, and we have to do it."
-
- Two new words, "outsourcing" and "off-shoring,"
have entered the American corporate vocabulary. Given that this is a presidential
election year, those terms are bound also to enter the language of politicians
and so to become part of the public debate.
-
- The only cross-border difference is that we, so far,
seem to be barely aware of what's going on.
-
- For quite a few years now, the U.S. has been unsettled
by the "giant sucking sound" of blue-collar manufacturing jobs
going south of the Rio Grande, and, in fact, much more often these days,
going west to China and elsewhere to the far side of the Pacific.
-
- This phenomenon, although less devastating than originally
expected, is the reason why George W. Bush, despite a booming economy,
is the first president since Herbert Hoover to preside over a net loss
of jobs during his term in office.
-
- A related, but quite different, phenomenon is causing
the U.S. to experience what's called a "jobless recovery." Sooner
or later, it will have the same effect upon our own labour markets.
-
- Where blue-collar jobs once went, first, outside the
parent corporation to smaller non-unionized companies, or "out-sourcing"
and, later, often entirely outside the country itself, or "off-shoring"
÷ white-collar jobs are now beginning to go.
-
- Under threat, therefore, is the stability and sense of
security of the white-collar middle class that is the social and political
foundation of every industrial nation.
-
- Awareness of this new phenomenon dates from a 2002 report
by the research group, Forrester. It forecast that 3.3 million white-collar
American jobs could move overseas ÷ including 500,000 jobs in information
technology ÷ by the year 2015, or little more than a decade hence.
-
- A shift of this magnitude wouldn't all be an absolute
loss to the U.S.
-
- As the McKinsey Global Institute has pointed out, American
consumers would benefit from lower prices for goods and services and the
incomes being generated overseas would create new markets for American
products. Indeed, McKinsey claims the shift of labour would produce a net
benefit to the U.S.
-
- The job losses by American white-collar workers would
be real, though, and they would occur first before any second-order benefits
÷ which, anyway, are speculative ÷ could manifest themselves.
-
- Labour anxieties would increase. This, in turn, would
allow employers to hold down white-collar as well as blue-collar wages.
-
- Already, wages are lagging far behind the rise in profits
and executive salaries in America. Income gaps would, therefore, widen.
As well, any job losses, even if relatively short-term, will leave American
workers without health-care protection.
-
- The destabilizing effect of globalization, already felt
in many underdeveloped countries, would now manifest itself in even the
most advanced of all developed countries.
-
- In fact, it's hard to see why those ugly concepts of
off-shoring and outsourcing ÷ IBM's preferred phrase is "global
sourcing" ÷ won't cut deep swaths through the American, and,
inevitably, also the Canadian, middle class.
-
- What China is doing to the North American manufacturing
industry, India, and other English-speaking, low-wage nations like Malaysia
and the Philippines and South Africa, may do to the North American service
industries. Russia has also benefited, as have some Eastern European countries.
-
- The public sector, from government to education to health,
will be excluded, mostly. So will all strictly local service industries,
from restaurants to laundromats.
-
- But a great deal else, from data entry to call centres
to payroll processing, will be affected. Some design engineering has been
shifted overseas. Indian doctors are now providing remote diagnosis of
American patients.
-
- Nor is the U.S. the only country affected. The HSBC banking
group has just announced a shift of 4,000 jobs from Britain to India, and
Norwich Union Insurance is moving 2,350 jobs to the same country.
-
- Morgan Stanley's chief economist, Stephen Roach, has
coined the phrase "labour arbitrage" to describe what's going
on.
-
- Another way of saying that is that white-collar workers
in North America and in Britain (so far it's almost entirely an Anglo-Saxon
phenomenon) have been turned into pawns to be moved about to suit the convenience
÷ the profits ÷ of corporate kings and queens.
-
- These pawns, though, are made of flesh and blood rather
than of plastic or wood. So expect them to fight back.
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