Migrating jobs and the global economy Editorial
Guyana Chronicle
March 11, 2004

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WHEN billionaire Ross H. Perot predicted in the mid-1990s that the United States was about to hear “a giant sucking sound” of jobs leaving the American soil, his comment quickly became the butt of many cartoons and jokes. Today, however his words have an eerie resonance when one hears the facts and figures on the state of unemployment and job-creation in a United States economy that is well out of the abyss of its recent recession. And although some 118,000 new positions have been created for the year, this number is but of fraction of the 2.6 million new jobs the American administration had predicted for 2004. Observers are citing the outsourcing of jobs as one of the main reasons for the worrying level of unemployment in the United States. News reports on the Internet and in the mainstream media routinely feature the comments of manufacturers lauding the huge savings and profits they make mainly because of ‘dirt-cheap’ labour costs they enjoy by moving their production plants from the United States to the countries of South East Asia.

A February 26, 2004 report in ‘The Christian Science Monitor’ makes the case for outsourcing succinctly: “India may still be the world’s outsourcing king. The great global magnet that’s attracting American and European service-industry work such as computer programming, insurance-claims processing and call-center staffing. But a growing host of countries aims to knock India off its throne. From South Africa to Russia to Hungary to China, ambitious nations and companies are rushing to build call-center capacity and back-office processing units to claim their share of America’s rich outsourcing pie. So, even as US presidential candidates and labor unions bemoan their loss of jobs, there is growing global ability to attract American work. That means it may even get easier and cheaper for US firms to ship jobs overseas…In 2003, US firms struck $119 billion worth of million-dollar-plus outsourcing deals - up 44 percent from 2002, according to Gartner, a research firm based in Stamford, Conn. In 2004, Gartner projects there will be 30 percent more US firms doing outsourcing than last year.”

The article goes on: “South Africa is in the top echelon of India’s IT competitors, according to Gartner. The group also includes Canada, China, Hungary, The Philippines, Poland, Russia and others. A second tier includes Belarus, Costa Rica, Egypt, Estonia and Venezuela. Promising rookies include Ghana, Mauritius, Morocco, Nepal, Senegal and Vietnam. ‘We’re in a global market,’ says Richard Matlas, a Gartner research director. ‘Even though some politicians are trying to jump on the bandwagon of keeping jobs in the US, corporations have to look at global delivery of their services to stay competitive.’”

Viewed in the context of an increasingly integrated word economy, the outsourcing of jobs from the United States and other sophisticated, industrialised countries is just another telling characteristic of globalisation prophesied by social theorists in recent decades. It would be a borderless world in which capital would follow efficient systems and skilled workers to any part of the planet. Efficient nations with state-of-the-art communication and transportation systems will be headed for prosperity leaving by the wayside those producers and states that are unable to compete in the global marketplace.

Addressing members of the American Chamber of Trinidad and Tobago in April 1997, West Indian scholar Wendell Motley described globalisation as having the potential of becoming the most seriously destabilising force in the Caribbean as well as the world. He predicted the emergence of a new global elite, who, through knowledge, skills and the access to information, “will stand as toll-keepers at several access points to the fantastic new wealth machine that is the global economy”. The Yale economics graduate then painted the obverse picture. “In contrast, there is the other aspect, the masses of humanity numbering in the billions and including millions in the so-called developed world, who, because of their lack of education, training and socialisation, have been rendered not just unemployed, but irrelevant by those technological processes that are super-productive, increasingly knowledge-driven and capital-intensive.”

In order to enjoy the benefits of this doctrine, countries like Guyana will have to develop quality goods and services at the highest levels of competencies and then employ aggressive strategies in offering these goods and services at the international marketplace.