In my opinion, there must be some truth to an argument when libertarians and progressives agree on an issue.
Here is a commentary by Paul Craig Roberts on the determent of outsourcing and insourcing foreign talent into the workplace.
Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions. He can be reached at: paulcraigroberts@yahoo.com.
Outsourcing Smarts
The Death of US Engineering
by Paul Craig Roberts
When employers allege a shortage of engineers, they mean that there is a shortage of American graduates who will work for the low salaries that foreigners will accept.
The May payroll jobs report released June 2 by the Bureau of Labor Statistics confirms the jobs pattern for the 21st century US economy: employment growth is limited to domestic services.
In May the economy created only 67,000 private sector jobs. Job estimates for the previous two months were reduced by 37,000.
The new jobs are as follows: professional and business services, 27,000; education and health services, 41,000; waitresses and bartenders, 10,000. Manufacturing lost 14,000 jobs.
Total hours worked in the private sector declined in May. Manufacturing hours worked are 6.6 percent less than when the recovery began four and one-half years ago.
American economists and policymakers are in denial about the effect of jobs offshoring on US employment. Corporate lobbyists have purchased fraudulent studies from economists that claim offshoring results in more US employment rather than less. The same lobbyists have spread disinformation that the US does not graduate enough engineers and that they must import foreigners on work visas. Lobbyists are currently pushing, as part of the immigration bill, an expansion in annual H-1B work visas from 65,000 to 115,000.
The alleged "shortage" of US engineering graduates is inconsistent with reports from Duke University that 30 to 40 percent of students in its master's of engineering management program accept jobs outside the profession. About one-third of engineering graduates from MIT go into careers outside their field. Job outsourcing and work visas for foreign engineers are reducing career opportunities for American engineering graduates and, also, reducing salary scales.
When employers allege a shortage of engineers, they mean that there is a shortage of American graduates who will work for the low salaries that foreigners will accept. Americans are simply being forced out of the engineering professions by jobs outsourcing and the importation of foreigners on work visas. Corporate lobbyists and their hired economists are destroying the American engineering professions.
A country that doesn't make things doesn't need engineers and designers.
American engineering is also under pressure because corporations have moved manufacturing offshore. Design, research and development are now following manufacturing offshore. A country that doesn't make things doesn't need engineers and designers. Corporations that have moved manufacturing offshore fund R&D in the countries where their plants have been relocated.
Engineering curriculums are demanding. The rewards to the effort are being squeezed out by jobs offshoring and work visas. If the current policy continues of substituting foreign engineers for American engineers, the profession will die in the U.S.
Here is a commentary by Paul Craig Roberts on the determent of outsourcing and insourcing foreign talent into the workplace.
Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions. He can be reached at: paulcraigroberts@yahoo.com.
Outsourcing Smarts
The Death of US Engineering
by Paul Craig Roberts
When employers allege a shortage of engineers, they mean that there is a shortage of American graduates who will work for the low salaries that foreigners will accept.
The May payroll jobs report released June 2 by the Bureau of Labor Statistics confirms the jobs pattern for the 21st century US economy: employment growth is limited to domestic services.
In May the economy created only 67,000 private sector jobs. Job estimates for the previous two months were reduced by 37,000.
The new jobs are as follows: professional and business services, 27,000; education and health services, 41,000; waitresses and bartenders, 10,000. Manufacturing lost 14,000 jobs.
Total hours worked in the private sector declined in May. Manufacturing hours worked are 6.6 percent less than when the recovery began four and one-half years ago.
American economists and policymakers are in denial about the effect of jobs offshoring on US employment. Corporate lobbyists have purchased fraudulent studies from economists that claim offshoring results in more US employment rather than less. The same lobbyists have spread disinformation that the US does not graduate enough engineers and that they must import foreigners on work visas. Lobbyists are currently pushing, as part of the immigration bill, an expansion in annual H-1B work visas from 65,000 to 115,000.
The alleged "shortage" of US engineering graduates is inconsistent with reports from Duke University that 30 to 40 percent of students in its master's of engineering management program accept jobs outside the profession. About one-third of engineering graduates from MIT go into careers outside their field. Job outsourcing and work visas for foreign engineers are reducing career opportunities for American engineering graduates and, also, reducing salary scales.
When employers allege a shortage of engineers, they mean that there is a shortage of American graduates who will work for the low salaries that foreigners will accept. Americans are simply being forced out of the engineering professions by jobs outsourcing and the importation of foreigners on work visas. Corporate lobbyists and their hired economists are destroying the American engineering professions.
A country that doesn't make things doesn't need engineers and designers.
American engineering is also under pressure because corporations have moved manufacturing offshore. Design, research and development are now following manufacturing offshore. A country that doesn't make things doesn't need engineers and designers. Corporations that have moved manufacturing offshore fund R&D in the countries where their plants have been relocated.
Engineering curriculums are demanding. The rewards to the effort are being squeezed out by jobs offshoring and work visas. If the current policy continues of substituting foreign engineers for American engineers, the profession will die in the U.S.
posted by Van at 4:24 AM
6 Comments:
Van,
Hope the bugs are gone!
#1 Is that many people end up in jobs far away from what they majored in.
#2 I worry about talk that seems to imply we need to decide how a country runs its business.
#3 If the article is accurate it does concern me. But there are always two points of view. And not being my area of expertise I cannot really give an entirely educated argument of the “other side.” (Thanks for always writing about things that are over my head. lol)
My ultimate concern is that people instead of focusing on the content of such an article, they will just pluck the numbers out of context to attack the current administration on the economy.
I think it is a little nit-picky to take the jobs created and say that they are somehow not important or don't count because they are waitresses. If the point of the article is to stimulate businesses in to changing, that is valid. If it is to say the Government needs to do more, I would argue that is the wrong approach.
On the issue of “outsourcing” and H-1B Visas, I agree with Roberts, though he makes his point somewhat disingenuously here.
The May job creation numbers were a paltry 77,000 (not the 67,000 he claimed), and this number jibes with his own breakdown – 27,000 professional & Business Services, 41,000 Health Services and 10,000 waiters & bartenders (total of his own numbers 27K + 41K + 10K = 78,000).
But he is most disingenuous in implying that most of the jobs added were service sector jobs (waiters, etc), when only about 11.5% were created in that category, while appx. 55% were in the health field and about 34% were in the professional and business sector.
I revile deliberate deception even when I agree with the deceiver.
The terrible truth about H-1B visas is that they really exploded from 1993 to 2000, when slightly over a million H-1B visa workers were brought into the country and the cap was raised from 65,000 to over 200,000 per year.
The issue smacks of the same deliberate obfuscation that “the homelessness” issue smacked of two decades ago.
Deinstitutionalization begun in the mid-1970s was almost completely responsible for the homelessness epidemic that followed in the 1980s, but our poorly mis-educated “people of the press” (tradionally soft on math & science) either couldn’t make a very simple deduction, or simply found it more convenient to blame the resultant policies on a President they didn’t like – to wit Ronald Reagan.
Here, H-1B visas exploded during the Clinton administration and the numbers have been reduced to their baseline level of 65,000/year, by Bush, but instead of opponents of outsourcing crediting Bush with at least reining in the H-1B Visa program and returning the numbers to their original baseline, many seem to want to pretend that the Clinton numbers “belong to Bush” as well.
That’s the wrong way to argue this issue.
One of the problems with “white collar”/professional jobs is that there’s no organized representation for these laborers and that has left them at the mercy of employers, who, in turn, are at the mercy of market forces like consumer demand for lower costs.
I’d eradicate the H-1B visa program, as I’d eliminate the GATT expansions and NAFTA...and now CAFTA as well. All these “Treaties” are inherently anti-worker, but let’s not lie about this issue, it’s too important.
GATT was expanded in 1989 under then President George Bush Sr., with the help of a Democratic (Tip O’Neill) Congress and NAFTA was passed in January of 1994 by a Democratic President (Bill Clinton) and a Democratic Congress.
BOTH major Parties have worked against the interests of the American worker...and for a very long time.
Hi MD, yes they are all gone, thanks for asking.
I hope that we don't have to go through that again for another 10 years or so.
The first few nights at the Holiday Inn Express were fun, but it was good to be home again.
To your first point:
"When employers allege a shortage of engineers, they mean that there is a shortage of American graduates who will work for the low salaries that foreigners will accept"
The problem is not that people are not working in their majors, it's that there are not enough engineering jobs for all of our graduates, yet companies are complaining that there is a talent shortage -- a ploy for cheap labor.
Look, if we are moving into an information age, then we must protect the jobs of the information age right? Otherwise we will all be over educated and underpaid.
On your second point -
Hell yes, a nation can define the way a company does its business. Otherwise we should let GE sell WMD's to Iran.
There are and should always be guidelines as to how corporations "do business". Since corporations are granted status by the government of and by the people, they are obligated to serve the common good at least to some extent.
The extent is debatable, but I think that allowing corporations to create a constitutional type of document (the WTO), without involving the people who are affected by the rulings, is not for the good of the people.
The trade agreements, or should I say treaties, subvert our national borders and our national identity. We are now subject to the will of the multinational corporations over our own national borders, and our own constitution.
To the third point: I don't think that Paul Craig Roberts is a hack, but I don't speak for him.
By the way, it was Clinton who kicked the doors open on the WTO and got us into this mess. The current Bush Administration is just a clueless as his, but they didn't start this fire.
Finally, there is nothing wrong with being a waitress, but how can our economy survive if we do not produce engineers. That is, people who innovate? It won't.
Second, a waitress makes about $25,000 per year. An Engineer makes over $55,000 per year.
By asking that question you are essentially asking - why not facilitate our economic fall to the bottom?
Bryan - good point. I read an article some time ago by the director of the IEEE.
He maintains that the sting of outsourcing has not been felt by the majority of Americans yet.
He called this the Desparity Rate.
He believes that once the desparity rate of say 40% to 60% is acheived (40% of those who have been affected by outsourcing to the 60% who have not) then we will see some legislative changes.
Until then it is going to be a bumpy ride to the bottom.
JMK - thank you for making your point.
Bravo!!
I am amazed at how often that I find myself reminding others that it was mostly President Clinton who sold us out, not the Republicans, althought they are just as complicit.
Bryan is certainly right that no comapny should get tax breaks for outsourcing.
I'd go even fiurther and tariff the goods and services received from such sources.
That said, the engineering shortage is not entirely one of Americans not willing to work for what foreigners will.
After all, foreign workers on H-1B visas have to live in the U.S. while working here, so they can't subsist on subsistance wages.
Some of it is sadly due to the failure of American education in the math and sciences.
Now, I'm also sure that many engineers would bristle at gratly improving our educational parameters and, in effect, flooding those same fields with tens of thousands of "American-made" engineers and scientists as well, because it would have the same effect...greater worker availability than deamnd = lower labor costs/wages.
That's what I've always opposed about the Union movement - those jobs (electricians, plumbers, carperters, etc) DO NOT belong to today's workers, NOR the Unions.
The school system and the government SHOULD be able to team up and flood those professions with able bodied workers even if it means lower wages and fewer benefits because more avaiable workers is a "common good," while a scarcity is net negative for all consumers.
As I said, it's a very tough issue, in that it's not at all simple, especially given today's economic trends in AMerica - near record low unemployment, 0.4% inflation and a huge +5.6% annual growth in GDP!
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