According to a Reuters article this past weekend by David Zielenziger, U.S. corporations are picking up the pace in shifting high-paying technology jobs to India, China and other "low-cost centers."
In the article, Zielenziger reports that the number of U.S. jobs outsourced to India is expected to double in the next three years, and it’s being predicted that as many as two million U.S. white-collar jobs will shift to low cost centers (read overseas) by 2014.
Are we going to stop this job hemorrhaging? Sadly, the answer is “no.” As long as companies can make more profit by shifting their labor force to cheaper locales, they will. Think about it: A company that’s paying its labor force $15/hour discovers it can pay $2/hour overseas for the same work, what do you think it’s going to do?
Let’s assume this trend we’re seeing is not going to stop. By looking down the pike at the ripple effect of such actions, it’s not far-fetched to predict the US economy will assume a much lower profile on the world stage. Eventually, when all the probable consequences fall into place, the economy starts to collapse. It may happen gradually, or a trigger-event may send it into a spiral. What about your livelihood? What can you do to prepare for such a situation?
The best thing to do—according to the experts who study this stuff—is to get out of debt. This is the number one recommendation: Retire as much debt as possible. You will be in a much better position if you don’t owe money you cannot pay.
Another suggestion coming from the experts who see a collapse on the horizon is diversify your income sources – but don’t do it in the stock market (The markets will likely be the center of any economic storm).
If you’re wondering why diversification is a suggestion, consider the 17,000 employees of Enron who suddenly became jobless when their company collapsed. If they had all their eggs in one basket, they were hurting! If they were diversified (again, not in the stock market), they didn’t come out quite so bad.
The idea is to create income independent of a corporate entity. Several ways exist, but perhaps the surest way is to start your own business – even a side business. Yes, it takes work, but probably not much more than you’re already doing.
I know a woman named Maggie who was a supervisor in a large corporation. Maggie put in ten-hour days on a regular basis. Then one day she decided to quit and open a pizzeria. A co-worker said, “Are you sure you want to do that? That’s long hours and hard work!” To which Maggie replied, “And this isn’t?”
The point is that if you’re working hard for someone else, you’re already working hard, so why not work hard for yourself?
This principle is personified in Ty, another acquaintance, who was recently laid off from his sales job after twelve years with the same company. Tired of working hard for others, Ty started his own company and now sells for himself. He tells me, “It’s great. I’m doing the same work I did before, but now instead of keeping only 20% of what I sell, I’m keeping 100%."
Remember that I suggested the trend of jobs moving overseas is not going to stop? According to Reuters, AT&T Wireless recently told the U.S. Securities & Exchange Commission that it would be laying off 1,900 employees this next year. Interestingly, a memo obtained from a consulting company in India outlined how that company would be assuming those AT&T jobs. U.S. Companies are not shouting these cost-saving measures from the rooftops out of fear of public backlash. But the shifts are happening nonetheless.
It is very probable that a collapse is on the horizon. The prudent question is “will you be prepared when it comes?” Having a plan to provide for yourself (or your business) is simply good business preparation.