How do you compete? 1

[ridix]

This clearly illustrates a problem in the current US IT environment.
Question is, how can you compete and, what is our future going to be like?

>>>

http://money.cnn.com/2004/01/19/news/companies/ibm/index.htm?cnn=yes>>>

In Monday's report, the Journal said IBM pays U.S. programmers with three to five years experience about $56 an hour, including benefits, while IBM's internal documents say Chinese programmers with similar experience make about $12.50 an hour, including benefits.
>>>

I don't make anywhere near $56/hr, but I sure can't support a family on $12.50/hr either.

-Nervous NetAdmin

 

[Chacalinc]

Ridix, you must think on the life level of every country...
may be in US $12.5/h is poor for you, but in china, $56/h is for millioners!!

I live in south america, and here, a salary of US$2000/month is a very good salary.

 

[rphips]

Chacalinc

$2,000 a months is a good salary in the states to
Thats is if its After Taxes!!!!!!!! and all other deductables.




bob

Jones' Law
The man who can smile when things go wrong has thought of someone he can blame it on.

 

[Chacalinc]

Yeah, but in Peru or Bolivia, that one is only for millioners!!! (I'm not from Peru nor Bolivia, but we are millioners for those people).

I can tell you that with our salary, we can not survive 2 weeks in US.

Some time ago I went to London... I cant survive a week in that city!!! only with the rent (house) I would get empty.

 

[Chacalinc]

I remember to see a post where people from Polony (or Polonia in spanish) get a half as I do, and I have normal (medium) salary.

 

[chiph]

Salaries are relative to where you live.
Even someone who is well-paid by US standards couldn't live for long in cities like London or Tokyo.

For fun one day I looked on Realtor.com at house prices in Silicon Valley area -- $330,000 got you a very small house in a bad neighborhood. I couldn't afford to pay for that on my salary, but someone who lived there would be paid more to compensate for the higher local prices.

Chip H.


If you want to get the best response to a question, please check out FAQ222-2244 first

 

[CasperTFG]

I think the whole it's relative thing is a valid point, but what the original person was posting was that why should IBM hire you at $56/hr when they can send the work to China for $12/hr, and get the same results for 1/4 the cost.

How do we compete in a field where a company can get it done cheaper by going overseas. This comes down to the same thing that was happening years ago with US companies moving their factories over seas.

In the end they had a tougher choice, 1) Make the product in the states with a higher labor cost and sell it in the US. Or 2) Make the product overseas at a low cost and then pay import duties to sell it in the US.

But in the IT industry how do you charge an import fee?

Casper

"I feel sorry for people who don't drink. When they wake up in the morning, that's as good as they're going to feel all day."
~Frank Sinatra

 

[Chacalinc]

Good point, I read a news on internet regarding England... they are using people from India because they are cheapest than England people.

 

[SemperFiDownUnda]

This is globalisation. Do you worry about it? I don't. I just make sure I make myself very marketible.

I'll give you a situation that just happened here in Australia. Telstra (the national semi-government telecom) just awarded an company in India about one third of the development of a particularly large system. This was formally being done by IBM who had 100% of this project. The other two thirds of the project was going back up for tender. IBM knew they couldn't just go ahead as normal as the Indian company would underbid them easy. So IBM pitched that Development would be done by IBM in India while the BA and managment would be retained by IBM in Australia. This effect a few hundred developers in Australia that work for IBM.

Is it wrong? No...this is globalisation. One thing people have to get through their head, and you might not like this idea, is that for you to be rich someone else must be poor. In years as the living standard of these other countries goes up and globalisation increases they'll start charging more also. We can no longer look at a country as an autonomous unit. Imports and exports effect that country and those it interacts with. Its this import export that will start closing the gap between countries average salaries.

The same arguement you talk about happens within the US to. A programmer in Boston lets go with the extreme of Silicon Valley costs A LOT more then one in Albany GA. They might have the same abilities but one earns 30-40k a year the other 5 times that much. In fact the one in Albany GA may very well live in a better house too.

I view this whole situation with optimism for the people that are in the poorer countries. Do they deserve the chance any less then you? Are you better then them and deserve to make 5 times what they do while they live in poverty? Nope. Do I feel sorry for you when you loose your job? Yes. Do I feel that the company is wrong for sending the work over sees? Depends. If it is properly thought out and reaps the benifits that they are seeking, cost saving, then its smart business as long as they are not exploiting the cheap labour over seas. By that I mean these coders/etc are not in sweat shops. These technical people in other countries are often making very good money for where they are at so this isn't exploiting them.

Sorry to say but if you look at these places over seas many of them have better QA processes then the average Western Countries.

When you are faced with these situations you need to step back. Get out of your shoes and look at it honestly and objectively from a higher level. Put yourself into the other peoples shoes. Many Westeners need to pull their heads out an fully realise what our lifestyles cost in the grand scheme of things. I'm not some fanatic here. I'm a realist. I fully understand and accept what my life style cost and have come to terms with that. I understand that when I buy a new computer or tv or a few xbox games that I could have channeled that money somewhere where it could have a major impact on one or more peoples lives and probably even save lives.

So a job lost to overseas may mean you are not as well off but that job that went overseas might be going to a young man or woman that is supporting a family that if the job was not there would be 5 times worse off then you are by not having that same job.



Hope I've been helpful,
Wayne Francis

If you want to get the best response to a question, please check out FAQ222-2244 first

 

[ChrisHunt]

Wayne's absolutely right on the long-term benefits of spreading wealth around the world via globalisation (though I suspect that a large proportion of the profits from these operations actually stays in the West).

As to how you compete, I think there are ways to do it. Writing a computer program is not like making T-shirts or other manufacturing jobs - it's an interactive process. Customers have vague ideas about their requirements that have to be hammered out into reality over time. It's the kind of thing that's best sorted out face-to-face - you're on the spot, you speak the customer's language, you understand their marketplace - this gives you an advantage over offshore operations.

If you're in the business of turning rigid specifications into source code, you're in trouble. If you're providing solutions to customers you can compete.

-- Chris Hunt

http://www.mcgonagall-online.org.uk

http://www.napitalia.org.uk

http://www.leicesteryha.org.uk

 

[CasperTFG]

I think that's the thing... What you say writting computer programs aren't like making T-Shirts.

Well the way I look at it it kind of is. If I was making a white cotton polyester blend t-shirt and I needed 1 million of them. The obvious thing there would be to give the work to the lowest bidder which usually means overseas, which is a lower cost of living therefore meaning less wages to pay to get the job done.

But if I wanted a custom t-shirt, like for a sports team. I want my teams name on the shirt with the logo on the left sleeve, and the players name stitched on the back, in varying sizes and I only needed 20 of them. Well then it wouldn't make much sense to send that order over seas.



Casper

"I feel sorry for people who don't drink. When they wake up in the morning, that's as good as they're going to feel all day."
~Frank Sinatra