Engineering is Going Overseas - Goodbye Jobs 55

[havesealwilltravel]

A friend of mine sent me the following link:

http://www.ieeeusa.org/forum/POLICY/2003/061803.html

It is depressing but true. The current high unemployment among engineers is going to continue and not only that it will get worse.

One of the threads in this forum concerns itself with encouraging women to go into engineering. If you care about the person, be honest with them (and yourself). Engineering as a career for a large number of people is over. A bright young person would be smarter to pursue another profession.

I don't believe that a person is born an engineer and will only be happy if they become an engineer. Obviously, if current trends continue, a lot of engineers are going to have to seek happiness in another career if they want to earn a living.

Globalization is good only for individuals with substantial capital to invest overseas. For the rest of us who work for a living it has done nothing but lower wages and increase unemployment.

Please read the article !!!!!!!

 

[funnelguy]

Just another historical note. "No taxation without representation" was a colonial battlecry when our government (the King of England) sought to enrich themselves unfairly through the sweat of the colonists.

I promise you that a vast majority of the Americans I talk to believe our politicians have only their own interests at heart. The money donated to BOTH major political parties by large industries coupled with the continuing loss of jobs only serves to deepen the mistrust.

 

[rhodie]

The economy will turn around and run again when consumers have more income and can begin to reduce their debt.

How can people simultaneously pay down debt and stimulate the economy at the same time? Either people spend money and buy goods and services, or they compensate creditors for goods and services already purchased. We only appreciate the economic *BANG* once, regardless if you actually own what you've purchased.

**********************************

With respect to China, we all must understand the culture before we try to predict the future. China is the most ethnocentric and egocentric of all superpowers. They are hardly concerned about how the USA fares economically. With 1.3 billion potential customers, they will become a self-sufficent economy before long.

Investigation of Chinese political intent reflects that the Communists are Imperialist and Expansionist. China believes that Taiwan is a rogue province of the mainland, and regularly holds wargames simulating "The Battle of Taiwan". China believes it's "Manifest Destiny" is to re-unite with Taiwan, soon.

China tolerates the USA because WE are were THEY draw wealth from. After we are spent, the complexion of world politics will change dramatically.

**********************************

China was civilized for hundreds of years before 1776. Why aren't they the world's largest economy? The birth place of mankind was in the Middle East, how come Western Civilization created markets bigger than the town sqare?

Well, the answer to your question appears to be that all of those previous economies and political system served the demands of an elite few rather than the needs to the many.
Communism, Despotism, and Monarchies all support a society based on class structure. The USA was unique in the 18th century because we had no class barriers to overcome, and shared the idea that we all had an equal shot at being economically successful.

Unfortunately, the idea of "economic success" in the USA has taken a new meaning in the past 30 years. I guess wealth beyond comprehension is "sucess" these days.

My opinion is that the downward trend in the US will continue unless US-Sino relations sour, corruption overtakes the Communist government, or China expands too quickly and it's economic infrastructure collapses under the weight.

 

[funnelguy]

Hi Rhodie,
You've been quiet lately. Good to see some posts again.

Quote, "How can people simultaneously pay down debt and stimulate the economy at the same time? Either people spend money and buy goods and services, or they compensate creditors for goods and services already purchased.

I do this all the time. I don't stop buying vehicles, food and golf balls because I have a mortgage and credit card debt. More money in the hands of US consumers would have a stimulative effect on more then just the US's economy. Right? Hey, maybe our government will forgive our debt in the same spirit as it forgives the debt of other nations. Just kidding.

You may be right about China. I was hoping they wouldn't "kill the golden goose", but you could very well be right. I'm still hoping they develop a better domestic economy. They certainly have all the elements to be the world's largest economic (and consequently, military) power.

 

[sdeng]

This thread is really big, and I didn't read all of it, but I have a few comments that I hope weren't said already. I view the future a little more optimistacally than most of you, granted it may be unrealistic, but I do not get much hope from exploring reality. It is has been stated that most of the engieering jobs are going overseas due to globolization. I'm not sure that the true potential of globalization has been discussed here. Imagine if our government and other governments around the world would drop tarrifs and make a real effort towards free trade. Everythign would be made where it's most economical. That could mean that TVs, cars, computers, and other technologies would become very inexpensive. This would cause many US jobs to be lost at first. But imagine when the whole world realizes how cheap it is to buy the technologies that we only see in the US and other technology oriented nations. Imagine if everyone in china, africa, etc could finally afford 3 tv's per household, laptops, cars, and so on. The demand would be so high, companies would even make money from hiring US workers. There is no reason for third world countries to exist anymore, the future is for them to catch up to us. The question is how will they catch up? Outsourcing seems like a good answer. The question is how much will it affect us. Not as much as we think. The worst thing that could happen is that all engineering jobs go overseas. Our companies will still be making the profits, but now we will have no one from the states who can afford anything, so either the jobs come back or the rest of the world starts buying more goods. IF the jobs come back we will be back were we started, but if the world starts buying the cheaper commodities, companies will see demand go through the roof. So then companies will make everyone in the US a manager of overseas operations. We could have 300 million people be managers for overseas operations. IS that so hard to believe that 300 million people would be needed to manage sales for a world economy of over 6 billion? Then management would get outsourced, and again everyone in the US would be out of work. But now everyone in the rest of the world has a high standard of living. The rest of the world has all the engineers and managers, who over time have demanded better pay. Now they start hiring US workers because of cheap labor, and the cycle would be the opposite of now. Does that seem so hard to believe? I don't think so, the US became the top power in under 200 years. We have outran everyone else by miles, the only problem is that we cheated on the way and made it an unfair race. If we stoped worryin about our jobs and money and had a broader view of the world, we could get a better handle on the real problems. We don't need to worry about china becoming more powerful than us. If everyone in china was rich, do you think they would go out and take over the rest of the world? No, they are human beings, and since they are well off, they would see no need to make war on others. I say we move all jobs to china, let them become so rich, they will have to police the rest of the world in order to protect their own interests. However all of that is unrealistic. The US will not loose all of its jobs, but it will take a big blow if we don't realize we are living in a dream world, where we believe anyone in our country can be rich while the rest of the world is poor. I say we reduce everyones pay. Let engineers make $5/hour maximum, and reduce the rest of the jobs accordingly. Who would find a buyer for a 200,000 house? Prices would drop down appropriately, and we would be able to compete with the workers overseas, and still live pretty well off. Ofcourse people in england would come buy all our houses and businesses, but who would they rent it out to? No one in their right mind would immigrate to a country where you get paid $5/hour for engineering. The world is telling us that we are overpayed and have to many luxuries, we should listen, not try to tell the world differently.

 

[owg]

Iskit4iam asked:
Can you create wealth without manufacturing something?

I believe that you can. Others can do the manufacturing. We can offer superior learning, medecine, art, tourism, (by way of examples) for visitors from off-shore. They will be rich from all that manufacturing so we will charge a lot. Think how clean our air and water would be. People would come and pay for just that. However we will still have to be very good at what we do.

HAZOP at

http://www.curryhydrocarbons.ca

 

[ietech]

OWG:
We started as an aggrerian economy and society (good at it)then came the industrial revolution and we were very good at the things required to succeed in industrial and manufacturing endeavors.

Please tell me why a society that has the potential to be the most innovative society in the world should be relegated totally to the service and entertainment of visitors from others countries. We CAN produce quality products and I think WE SHOULD.

I personally do not want to smile at folks who can't even speak the language of my country for a $BUCK$ I am a worker and creator of ideas --- NOT A SUCK-UP just to survive.

I am not trying to say that services and tourism etc. are not important to our economy, but why try to exclude those like me who are suited for other things that are creative and contributory to a better world. Yes, you are right we will have to be good at this too or we will lose AGAIN.

It's not all about getting rich, it's about doing somthing solid and enduring.

regards,
ietech

 

[owg]

ietech - Are you suggesting that learning, medicine, and art are less enduring than polyolefins and stainless steel? One of my friends often asks the question whether we can get rich without making things. His last project was a polyethylene plant. I am not sure of the answer but I think it is worth debating.

In answer to your question, I don't know that we have the potential to be the most innovative. I think there are signs that we are no longer in that state of grace. I also don't agree that service is necessarily a relegation from goods. Military service, foreign service, secret service, can be top jobs. In the sixties Canada provide many international airlines with the best air hostesses until we legislated mediocrity into the business. I can't see why providing the best hotels in the world is inferior to manufacturing bobble headed football player dolls. The mark-up or value-added on first class hotel service is as good or better than on computers and dvd players. I don't see how screwing wheels on cars is superior to asking a variety of people "Do you want fries with that?" The former is a higher paying job because of early abuses in the industry leading to strong unions.

HAZOP at

http://www.curryhydrocarbons.ca

 

[ietech]

Your point of view is correct --- Maybe it's the challenge of making the head BOBBLE on the rediculous doll without breaking off and not the doll itself.

These types of things --toys do apparently do make folks rich though.

I still think we are among the best as engineers and should compete on a level playing field. Our gov't, since it is our means of dealing with other countries, should ensure that the playing field is equal. Then and only then can we demonstrate our innovative abilities.

There is absolutely nothing wrong, from my point of view, with the services sector. I only say we shouldn't give up on our engineering, technical and industrial abilities.

 

[owg]

ietech - agreed. Don't give up, but don't subsidize losers.

HAZOP at

http://www.curryhydrocarbons.ca

 

[ietech]

No subsidies -- I whole heartedly agree.

By the way the doll mentioned previously, I think was designed and manufactured in China for the US market.

I have in my hand a perfect example of offshore manufacturing quality and accuracy, given to me by my 8 yr old nephew.

It's a model of the Navy Blue Angels F/A 18 aircraft in great Navy colors. It is a NICE model of the aircraft made in China. The Markings on top of the wings are --- Blue Angels --- USAF

Now we all know that the Thunderbirds are the USAF team and the Blue Angels are the USN Team. Maybe this will become a valuable collectors item because of this defect --- or not. It provided for a good chuckle though.

Just a minor example of offshore quality control on items designed for the US marketplace, especially China.

 

[EngineerDave]

This all will boil down to one thing, an osmotic diffusion of wealth. One day the world will be equally poor. Learn to subsist on a diet of cheap food and material things. That's what the environmentalists will tell you is required for an overpopulated world anyways!

Or you can bust your ass and make as much money now while the going is still OK. It's like the gold rush is coming to an end.

 

[Hush]

EngineerDave has it right but I think a more appropriate term would be entropy - degradation to an inert state of uniformity.

 

[rhodie]

"I'm here to be the skunk at your garden party"
Intel co-founder and chairman Andrew S. Grove speaks out on the ills of outsourcing.

********************************************************
Grove Says U.S. Is Losing Edge In Tech Sector
Jonathan Krim, 10.10.03, 1:18 PM ET

One of the founding fathers of the nation's high-technology industry warned in dire terms yesterday that U.S. dominance in key tech sectors is in jeopardy, threatening the country's economic recovery and growth.

Speaking via satellite to a global technology summit in Washington, Intel co-founder and chairman Andrew S. Grove said that the software and technology service businesses are under siege by countries taking advantage of cheap labor costs and strong incentives for new financial investment.

"I'm here to be the skunk at your garden party," Grove said, noting wryly that his remarks coincidentally fell on the same day as one devoted to promoting nationwide screening for psychological depression.

Grove, 67, singled out China and India as key threats. India's booming software industry, which is increasingly doing work for U.S. companies, could surpass the United States in software and tech service jobs by 2010, he said.

More ominously, Grove said, the software and services industries -- strong drivers of U.S. economic growth for nearly two decades -- show signs of emulating the struggles of the U.S. steel and semiconductor industries.

In the case of steel, U.S. companies never recovered, dropping from nearly 90 percent of worldwide market share to roughly 10 percent. The semiconductor industry, Intel (nasdaq: INTC - news - people )'s core business, faced similar challenges in the 1980s, when it began its drop from 90 percent to 40 percent of the world market, Grove said, before aggressive trade and other U.S. policies helped it recover and stabilize at about 50 percent.

Grove said that even as the U.S. economy is improving, tech employment is not.

According to industry data, more than 500,000 technology jobs were lost between mid-2001 and mid-2003. Many of these were due to a contraction of the tech sector in the wake of the bursting of the dot-com bubble in 2000.

But Grove acknowledged under questioning that the tech industry itself is responsible for numerous jobs leaving the United States, as firms take advantage of considerably cheaper labor costs in India and elsewhere.

Grove said he is torn between his responsibility to shareholders to cut costs and improve profits, and to U.S. workers who helped build the nation's technology industry but who are now being replaced by cheaper labor. Grove did not offer a solution, saying only that the government needs to help decide the proper balance between the two. Otherwise, he said, companies will revert to their obligation to increasing shareholder value.

Recent estimates from financial consulting firms paint a stark picture of "offshoring," which allows companies to get software development and other services at one-third to one-sixth the cost.

The Gartner Group (nyse: IT.B - news - people ), a market research firm, estimates that 10 percent of jobs at U.S. information technology vendors will move offshore by next year.

Throughout all U.S. companies, Forrester Research (nasdaq: FORR - news - people ) predicts the loss of roughly 3.3 million jobs by 2015.

Grove said that the move offshore has been aided by the telecommunications bubble of the late 1990s. So much infrastructure for high-speed Internet connections was laid, much of it never used, that the cost of achieving high-speed communication plummeted. As a result, Grove said, "the engineer sitting 6,000 miles away might as well be in the next cubicle."

Grove chided U.S. policymakers for all but ignoring the problem.

"What is the U.S. public policy?" he asked. "I am hard put to find a document" outlining a policy strategy.

He said he had detected no recognition of the problem from any of the presidential candidates.

Grove also criticized the nation's overburdened patent system, which he said is causing an abundance of innovation-slowing litigation.

He said that the inability of patent examiners to handle the workload has led to a backlog of important applications, but also less than thorough vetting of patents that perhaps should not be granted.

Grove also said the country lags dangerously behind in popular use of high-speed Internet connections, funding for science and technology research, and education.

Copyright 2003 The Washington Post Company

END

 

[ricky123]

I don't wish to make this a political issue but, if you keep voting Repulican all engineering jobs will be exported to China, India, Malaysia, singapore and etc . The board of directors of manufacturing and engineering firms have no loyalty to anyone of us except the money they will save(we engineers are expendable). The strenght of this great nation lies in the Entrepreneurship of small firms but if manufacturing and the expertise leaves, where will we be 10 years from now?

 

[havesealwilltravel]

ricky123

I think that it's obvious where we will be 10 years from now.

As a nation we are losing our manufacturing base. Service industries do not make wealth. To make wealth yuo must grow, mine or manufacture it. Service industries swap wealth but do not create it.

Our dependence on foreign countries for products will increase. Research and developement will follow manufacturing overseas. The remaining jobs will pay less and tax revenue will go down. Gov't spending will continue to rise and the deficit will grow.

The baby boom will retire. The government will not be able to honor its debt to social security and will have to default on the treasury bonds which back up social security.

The United States will join the list of empires which collapsed financially (not militarily): Roman Empire, Soviet Union, etc.

 

[funnelguy]

ricky123,
While a few Dems are clamoring for the repeal of the Bush tax cut, none to my knowledge are seeking to reverse or repeal GATT, NAFTA, et al. All of the viable candidates seem to be in lock step on trade issues. None of the members of either party really care about this issue. What they care about is campaign contributions.

I did notice that Bush took a bit of a beating from other conservatives when he favored steel tariffs. Still, we haven't heard any big pushes from the minority party to fix any of these problems. It really is sad, because historically the minority party has played a role in holding the other parties feet to the fire on those issues they disagree about. I don't see that currently.

Big businesses have no ideology. They will donate to both parties, but typically donate more $$$$ to the incumbent. They play both sides of the aisle. But I'm sure they donate only because they believe deeply in our political process. They couldn't possibly be attempting to buy influence. (Insert flaming sarcasm emoticon here)

 

[owg]

dannym - "Service industries do not make wealth."

Answer - Switzerland, founded 1291

Natural resources - potential hydro, timber, salt
Arable land 10.7%
Permanent crops 0.61%

"A prosperous stable modern market economy with low unemployment."

Agriculture 2%
Industry 34%
Services 64%





HAZOP at

http://www.curryhydrocarbons.ca

 

[rhodie]

owg

Switzerland has the benefit of being surrounded by fertile, arable land (i.e. Italy, France, Spain, Ukraine) strong manufacturing (i.e. Germany, Denmark, Great Britan) and natural resources (i.e. Polish Oil Fields, Baltic Reserves, North Sea Oil, France's Nuclear Industry).

Switzerland also has the benefit of having rather confidential, accomodating, and discrete tax laws, attracting much of Europe's wealth.

The point remains that Switzerland is the exception rather than the rule. The Swiss occupy part of a huge landmass with plentiful natural resources, developed industry, and vibrant agriculture. Don't think for a minute that Switzerland would continue as an entity without all of those elements, or at least benefiting from the cashflow of willing foreign investment stemming from those elements.

DannyM is correct. Service industries cannot make wealth; you can't get something from nothing. Consider the Swiss financial economy as you would the midwest Rust Belt or coal deposits in West Virginia- all are geographic specific industries. It just so happens for the scandanavian-high society types that Switzerland is the locale of choice for much of Europe's money.

 

[owg]

rhodie - I think you make my point. Switzerland has developed a uniques service industry with tax laws to support it. Location is less important than it used to be. And of course the manufacturing has to be done elsewhere and the service economy has to trade. That is the whole point. Why do you think Switzerland is the locale of choice for the high society types. It is not just location. If you want to learn about servicing such types, go to Switzerland and study hotel management and cooking.

HAZOP at

http://www.curryhydrocarbons.ca

 

[rhodie]

owg

The point was that services industries do not create wealth, and Switzerland does not. They are entirely reliant on foreign investment and constant cashflow to remain viable.

I agree with you, the Swiss have done an outstanding job with creating an economic niche' industry, but that is all it remains to be.