crossposted from unbossed
A new study by the Wharton School at the University of Pennsylvania and CareerBuilder.com provides new data on motives for sending US jobs abroad (and abroad can mean Canada) as well as which jobs are a likely target.
Here are what I found to be the more striking findings of the report.
The jobs that are most at risk are not industrial jobs. This may be because so few still exist in the US. Job done on sending them abroad.
Rather the jobs most at risk are those involving computers.
"The study indicates that services that can be delivered electronically and don’t require much face-to-face interaction are now at higher risk of being displaced."
This means that many high-skilled, highly paid jobs are most at risk. Think about it. As a company, where would you get the most savings - sending work overseas that is low paid or work that is highly paid, assuming you can find workers who abroad who can do both kinds of work? I think it would be the latter.
According to respondents who offshore, more firms are offshoring high-wage, high-skill jobs that were once thought to be immune to global competition. Twenty-eight percent of employers reported more high-skill service positions are being sent overseas to third parties or foreign affiliates in need of management, technology and sales and marketing know-how. The majority
of employers (69 percent) believe high-skill service positions are at equal or more risk of being offshored than low-skill jobs. Examples of jobs companies plan to offshore:
• Computer programmers – 32 percent
• Software developers – 32 percent
• Customer service – 25 percent
• Systems analysts – 16 percent
• Sales managers – 8 percent
• Graphic designers – 8 percent
• HR personnel – 7 percent
• General managers – 6 percent
• Marketing personnel – 5 percent
Among industries, technology services, telecommunications, insurance, manufacturing, engineering, banking & finance, oil, travel, utilities and communications all reported higher rates for offshoring.
When you look at that list, you can see that some of the jobs are highly paid, high skilled, but among the skills needed is not good command of spoken and maybe even of any English.
Of course, some companies are claiming that sending US jobs abroad is good for America. . . . <crickets>
companies are making the argument that offshoring is ultimately benefiting the American workforce. Twenty-eight percent of employers who offshored jobs said offshoring has already enabled them to create new, better jobs of different types in the U.S.
This is not exactly a shocker. Saving money a/k/a paying workers less is the prime motive.
Cost-savings is the primary motivator for offshoring, according to 64 percent of respondents. Looking at information technology specifically, the average firm saves over $20,000 per head by offshoring. Fifteen percent of employers say they are saving more than $50,000 per head.
But not all employers have jumped on the globalization band wagon. Here are reasons they resist.
When respondents who don’t offshore were asked why their companies chose not to, one-in-five (21 percent) said they felt it is important to keep jobs in the U.S.
Fourteen percent reported their customers would not respond favorably and 10 percent said they work with sensitive data.
Difficulty to build trust across borders, the cost associated with monitoring workers and shipping/materials, and the availability of a skilled labor pool abroad were also cited.
The study is Wharton School at the University of Pennsylvania and CareerBuilder.com, Jobs Beyond Borders
You can consider that information and how it fits with US job losses. Challenger, Gray & Christmas reported May 1 that job cuts by U.S. employers in April at 90,015 were nearly double those from March at 53,579. The finance sector is faring worst, with one-quarter of jobs lost for April was in the industry (23,106 jobs). The top for in descending order were telecommunications (8,007), transportation (7,954) and automotive (6,906).
The Bureau of Labor Statistics (BLS) report for April 2008 jobs is here.