Outsourcing is Good
Find a Conversation
Outsourcing is Good
| Sat, 01-31-2004 - 11:22am |
Some critics argue that "outsourcing" of service sector employment to foreign countries will lead to a serious decline in U.S. white-collar jobs. In reality, outsourcing will reshape but not undermine U.S. service sector employment, making companies more efficient. It will also benefit consumers and export businesses...

Pages
For you, love, I'll reveal my sources.
First, the AP had a nice little article on 3 new economic reports yesterday:
The economic recovery is showing new signs of staying power, a trio of reports said Monday, with a pickup at the nation's factories complemented by robust consumer spending and construction activity.
The Institute for Supply Management said its manufacturing index rose to 63.6 in January from a revised 63.4 in December. The reading signals a recovery that is broadening across manufacturing industries, although it is still not generating many new jobs, analysts said.
In other economic news, the Commerce Department reported that consumer spending rose by 0.4 percent in December, after a 0.5 percent rise the previous month. The November reading was better than the government previously estimated.
Consumer spending rose solidly in both November and December, better than earlier in the fall when spending was flat.
The government also reported Monday that construction spending in December rose to its highest level ever.
The total value of building projects under way rose 0.4 percent from November to a seasonally adjusted annual rate of $933.2 billion. Residential projects by private builders led the way, with spending on those projects also rising to a record monthly high.
Meanwhile, the ISM report offered upbeat news from a sector that was one of the hardest hit by the recession and one of the last to recover.
``The manufacturing sector gained momentum in January,'' said Norbert J. Ore, chairman of ISM's manufacturing business survey committee. ``Both new orders and production remain quite strong, indicating that the manufacturing sector is experiencing a much-needed recovery.''
An ISM index reading above 50 indicates expansion; one below 50 indicates that manufacturing activity is contracting. From March through June, the manufacturing index was below 50, but the new reading marked the eighth consecutive month of expansion.
Economists said the January reading indicates a rebound that is spreading throughout the sector.
``This isn't just some flash in the pan,'' said Mark Vitner, senior economist with Wachovia Corp. ``When you look at all the components it's hard not to come away with a more optimistic assessment of the manufacturing sector.''
<>
Beaurea of Labor Statistics
Gross job losses totaled 7.7 million in the second quarter of 2003,
229,000 fewer than in the first quarter of 2003. This is a return to the
downward trend in gross job losses that was interrupted by a slight increase
in the first quarter.
http://www.bls.gov/news.release/cewbd.nr0.htm
http://www.bls.gov/news.release/pdf/empsit.pdf
Real Earnings
Average weekly earnings rose by 1.7 percent, seasonally adjusted, from
December 2002 to December 2003. After deflation by the CPI-W, average weekly
earnings were unchanged.
http://www.bls.gov/news.release/realer.nr0.htm
Beaurea of Economic Advisors:
Personal income increased $18.8 billion, or 0.2 percent, and disposable personal income (DPI)
increased $18.5 billion, or 0.2 percent, in December, according to the Bureau of Economic Analysis.
Personal consumption expenditures (PCE) increased $35.3 billion, or 0.4 percent. In November,
personal income increased $31.9 billion, or 0.3 percent, DPI increased $27.7 billion, or 0.3 percent,
and PCE increased $42.0 billion, or 0.5 percent, based on revised estimates.
They also have an interesting chart here:
Personal income increased by 197.2 billion in 2002 and by 277.1 in 2003.
Real disposable personal income of chained (2000) dollars increased by 276.5 billion in 2002 and by 190.7 billion in 2003.
http://www.bea.gov/bea/newsrel/pinewsrelease.htm
<>
Actually that date has been revised. The last recession began at the end of Clinton's term.
<
Since the official end of the recession in November 2001, total jobs have shrunk by 0.8 million (an 0.6% contraction) and private-sector jobs have dropped by 0.9 million (or 0.8%).>>
BLS's official count, based on monthly survey of net job changes at 400,000 companies, shows 2.3 million jobs have disappeared since Pres Bush took office in Jan 2001; BLS monthly survey, based on interviews with 60,000 households, has employment rising by 689,000 jobs in Bush years...
LOUIS UCHITELLE (NYT)
Also, those self-created new jobs are playing a large role in the recovery.
Wall Street Journal:
"Now, investment strategist Kenneth Safian says he has found evidence that small enterprises really are playing an important role in the recovery. The evidence is buried in the government's monthly personal-income report, which was released last week. Proprietors' income, which is the income earned by individuals from running their own businesses and from partnerships, is surging. The Commerce Department reported Wednesday that proprietor's income, excluding the farm sector, was up 8.6% from a year earlier. By contrast, the wages and salaries of individuals on corporate payrolls were up just 2.3%...
Mr. Safian, who is president of Safian Investment Research Inc., based in White Plains, N.Y., says the upshot of the latest trend is that more workers are striking out on their own and earning money doing it. The economy, he says, "is becoming more entrepreneurial."
If that is the case, it would say a lot about the dynamism of an economy that has been through series of shocks in the past three years. It might also help explain why official payroll employment levels have been so depressed in recent months."
http://www.hobbsonline.blogspot.com/2003_12_01_hobbsonline_archive.html#107031152049913594
<>
Jobwatch shows a similar pattern for lagging labor statistics for the previous two recessions. Unemployment is the last indicator to rise at the beginning of a recession and the last the decrease at the end.
<>
These are the folks that fall into the sky rocketing self-employed category who are flying under the radar.
'Productivity of U.S. companies rocketed at a 9.4 percent annual rate in the third quarter, the best showing in 20 years, offering an encouraging sign that the economic resurgence will be lasting.
The increase in productivity -- the amount an employee produces per hour of work -- reported by the Labor Department on Wednesday was even stronger than the 8.1 percent pace initially estimated for the July-to-September quarter a month ago. It was up from a 7 percent growth rate posted in the second quarter.
"The booming productivity gains are translating into better profits, which are now inducing businesses to expand activities -- namely investing and hiring," said Mark Zandi, chief economist at Economy.com. "The report suggests that the economic expansion that is now unfolding will be solid and durable."'
http://www.ajc.com/business/content/business/1203/03productivity.html
And I'll throw this in just for fun:
"Yale economist Ray Fair, one of the most respected econometricians in the U.S., periodically calculates the vote total for presidential elections based on a political/economic model. Following is his latest forecast from Oct. 31, before the most recent GDP revision. As of that date, he was predicting that President Bush would get 58.3% of the two-party vote next year. Any increase in real GDP growth above the model's forecast will increase that percentage.
Fair says the good economic news of the third and fourth quarters of 2003 were unexpected and each quarter of good economic news...
...adds 0.837 percentage points to the incumbent vote share, so two extra good news quarters adds 1.674 percentage points for President Bush. The new economic values give a prediction of 58.3 percent of the two-party vote for President Bush rather than 56.7 percent before. This does not, however, change the main story that the equation has been making from the beginning, namely that President Bush is predicted to win by a sizable margin. The margin is just now even larger than before."
http://www.hobbsonline.blogspot.com/2003_12_01_hobbsonline_archive.html#107063728275959959
Renee
That's my experience, too, and what I've consistently witnessed around me. On the few occasions when I've seen people out of work for an extended period of time and eventually forced to settle for a less desireable position, they lead to new opportunities which allowed them to earn more then they would have in their original job.
Renee
Nothing worthwhile ever is.
Renee
http://www.cnn.com/CNN/Programs/lou.dobbs.tonight/
Scroll down about three-quarters of the page and then click the hperlink that says "Click here for a list of companies".
I tried to link directly to the list but that didn't work. Sorry.
I thought of boycotting but how the hell can I with a list this friggin' huge?!?!?
The US economy strengthened considerably in December, leading the global economic recovery and leaving Europe and Japan behind, the Organisation of Economic Cooperation and Development (OECD) said today.
The upbeat assessment of the US economy from the OECD came just hours ahead of a meeting of finance ministers from the G7 group of leading industrialised countries, with the weakness of the dollar the prime subject of concern.
"Moderate to strong recovery lies ahead in the OECD area," the organisation said in a statement. "December data signal continued strong improvement in the United States but weaker development for Italy."
http://www.guardian.co.uk/business/story/0,3604,1142714,00.html
WASHINGTON (AP) - The nation's unemployment rate dropped to 5.6 percent in January to the lowest level in more than two years as companies added just 112,000 new jobs - fewer than expected but enough to keep alive hope for a turnaround in the struggling job market.
The jobless rate fell 0.1 percentage point last month to the lowest level since October 2001, when it was 5.4 percent, the Labor Department said Friday. January's rate matched the 5.6 percent posted in January 2002.
Employers added new jobs last month at a pace not seen in three years. The last time payrolls expanded more than 112,000 was in December 2000, when companies added 124,000 positions.
http://apnews.myway.com/article/20040206/D80HSO483.html
Renee
Man-o-Man I guess you didn't comprehend what I wrote. I ended up agreeing with half of your post?
The ridiculous part of your statement is the knocking at the door comment. It came across as a "Like Duh" statement IMO.
I'll make sure to highlight the text next time, so there is no misunderstanding.
Bank of America moves operations to India
--------------------------------------------------------------------------------
NDTV Correspondent
Wednesday, February 18, 2004 (Hyderabad):
The momentum in the BPO sector is still on track. Bank of America Corp today said that it would set up a wholly owned Indian subsidiary for its back-office operations in Hyderabad.
The unit should be set by the second quarter of 2004 and would provide back-office support for all business lines of Bank of America.
The bank plans to employ 500 people by December 2004 and a 1000 people by the middle of 2005.
The announcement could create a stir in the US given that John Kerry, a democratic frontrunner in the US presidential campaign has hit out at companies that move jobs to countries such as India.
http://www.ndtv.com/business/showbusinessstory.asp?slug=Bank+of+America+moves+operations+to+India&id=17544
Pages