Work & Lack Thereof

Sorry that I haven't been posting more lately. Work has been extraordinarily busy and the weather in London is getting nicer. Between the 2, writing stuff here just hasn't been a priority.

One of the things that's occupied me is watching a co-worker get a severance package. This person is doing meaningful work, at a high level of performance and their skills aren't easily replaceable. Nevertheless, their job is being moved overseas. From a business level, I understand the rationale. Labour costs overseas are considerably cheaper and senior management become convinced that a worker is a worker (ie - skills can be re-learned and/or are transferable). Time will tell about that latter point in my friend's case.

I know that my friend is not alone. Many Canadians in many sectors of the economy are being hit with this reality. I personally think that this time, it's a little different for the following reasons:

• With most manufacturing and I/T moving offshore, where are the replacement jobs supposed to come from? In the 1930's Depression, when the economy improved, workers went back to manufacturing jobs that essentially existed before. That won't be the case this time.
• Jobs are being moved offshore because of cheaper labour costs. Unless we also export unions, does this signal the decline and/or end of much of our middle class?
• It appears that in some cases, the "bad economy" is being used as a rationale, but it's not the case for all companies. Many are still profitable, but (IMO) are using the downturn as an excuse to accelerate their outsourcing of jobs.
• Workers are not given the option to reduce their wages to compare with off shore people. They're just told that the jobs are going.
• Is it not a conflict of interest for senior management to be the decision makers that export basic workers' jobs but not their own? Surely, one could find some senior executive talent willing to work for less than what some North American corporate heads make?
• With corporations basically being autonimous (ie - not a citizen of any country), is there anything that our governments could/should be doing to retain these jobs? Should companies be offered tax incentives to retain their work force?

Tell me what you think. Have you had friends, family members or have you lost your job in the past year? Did the work move off shore, to the US or did the company just close? Does anyone have a good news story about finding new work at any sort of wage or skill level on par with what they were doing in their former jobs?

Thanks for reading and sorry for the delay in posting.

The Economy

Dan Brown and I have both blogged previously that people are neither inherently good or evil; they are inherently greedy. Nothing proves this point more than the current bad economic times. Cases in point include:

• GM CEO receiving $23 Million to leave his job
• AIG Employees accepting bonuses, despite the bailout funds and negative publicity
• Automotive employees not understanding that excessive wages are contributing (but not the only cause of) the Big 3 Failings
• Corporations quietly outsourcing jobs to India, China, Brazil and Argentina (amongst others)

There are many more. In the end, we have only ourselves to blame. We all want to retire with lots of savings from RSPs. RSPs are often containers for Mutual Funds. Mutual Funds are basically a bunch of financial "experts" gambling on which stocks will go up & down. How does a stock go up? The compnay makes more proffit than last year or makes a better "widget". The common business practice nowdays seems to be to cut costs to raise profits. Great; but that's done by outsourcing jobs; possibly your job or my job But hey, your RSP went up in value right?
A publically traded company must make more proffit than last year. Just making a proffit isn't good enough in "the shareholders' eyes". Privately held companies don't have to do that. They have only to answer to the owner(s) of the company. As my dad used to say, if you go to the bank, they will guarntee you x% return on your money. None of the mutual fund companies, etc. can guarntee a return. You may not make as much as the statistics show you will with stocks, but you have a guarntee and unlike our friends in the US, our banks are nation-wide and far less likely to go bankrupt.