Join 3,557 readers in helping fund MetaFilter (Hide)


The Future American Job
July 12, 2010 12:56 AM   Subscribe

These folks in rural Arkansas and Missouri are getting jobs that are often reported as going to India and other countries. Is this a sign of American ingenuity or decline?
posted by ziadbc (42 comments total) 2 users marked this as a favorite

 
this isn't really new - in 2000 i was working at an outsourcing center in dallas, tx and i helped remotely train the team in kalispbell, mt. they made about 30% less what we were making and about a month after training our contract was pulled from us and given to them.
posted by nadawi at 1:02 AM on July 12, 2010 [2 favorites]


nadawi: What is unique here is the positioning that this is the successor to overseas outsourcing, rather than the precursor.
posted by ziadbc at 1:08 AM on July 12, 2010


yeah, but it's not like overseas outsourcing wasn't happening simultaneously - i mean, we lost contracts to india as well. really, like cnn money often does, the whole thing reads like an advertising piece.
posted by nadawi at 1:15 AM on July 12, 2010 [1 favorite]


Won't the bucolic accents of these rustics be less easily comprehended, than those of the diligent, educated, and re-christened "Steves" and "Lisas" of Mumbai and Hyderabad?

(Channeling HL Mencken.)
posted by orthogonality at 1:19 AM on July 12, 2010 [4 favorites]


Eh, it's more like "Some journalist trying to find an interesting hook" to an article about, uh, people doing jobs.
posted by delmoi at 1:33 AM on July 12, 2010 [3 favorites]


Huge telecom I worked for in '02 had a national call center in Middle Of Nowhere, TX, to keep costs down and marginalize any potential for unionization.

They wound up opening another helpdesk in New England for their high-level customers, as the technical expertise was too thin on the ground in Middle of Nowhere... and salaries for top performers in TX started to creep up to reflect those of the New England team.

It's sort of like how automakers are going to the deep south to avoid the high cost of unions and regulation - but wind up spending as much money on their workforce (to keep the Unions out) and standards/safety compliance (to avoid liability lawsuits) as they would on a plant in Michigan or Ohio.

"Cheap workforce!" is usually never a good reason to move your business somewhere.
posted by Slap*Happy at 1:54 AM on July 12, 2010 [8 favorites]


"The cost of living is 23% less than a metro area. Consequently workers are paid 53% less than those in metro areas."

hooray for the free market
posted by hamida2242 at 2:07 AM on July 12, 2010 [15 favorites]


Huge telecom I worked for in '02 had a national call center in Middle Of Nowhere, TX, to keep costs down and marginalize any potential for unionization.

Is Texas an "at-will" state? Here in AZ call centers just tell you straight up that union talk isn't tolerated.
posted by hamida2242 at 2:12 AM on July 12, 2010


Slight derail.. I see people trot out "is your state an at will employer?" a lot in AskMe's. Er, are there states in the U.S. that aren't at-will? I know a few have specific policy exceptions, but is there actually a state that operates fundamentally different from the doctrine of at-will employment?
posted by cj_ at 2:28 AM on July 12, 2010


cj_: "is there actually a state that operates fundamentally different from the doctrine of at-will employment?"

Not all states are purely at-will, the exceptions to at-will employment vary widely.
posted by idiopath at 2:44 AM on July 12, 2010


Yeah I looked at that page before posting, and the answer still isn't clear to me.
posted by cj_ at 3:25 AM on July 12, 2010


That includes people like Zachariah Carlson, 27, who expected he would have to move to California to get a job after he graduated last fall from Arkansas State University with a computer science degree. (Jonesboro's biggest employers are the university, retailers and hospitals.)

Carlson says he and his girlfriend were grateful he got a job locally customizing back-end software systems for corporate clients. He works out of Rural Sourcing's 60-person development center, not too far from Booneville, the 5,000-person town where he grew up. "This is where we are from. Our whole lives have been here," Carlson says.

But don't call Carlson "cheap labor." He bristles at the idea. After all, he says, he's doing what he wants, where he wants, and he's proud of his work, even if it doesn't come with a Silicon Valley salary.

"The reason we're low-cost is because we're in a more rural area with a lower cost of living," he says. "I didn't have to sacrifice anything to get where I am."


Why bristle at the idea of being "cheap labor" if that he what he basically offers? Doing what he wants, where he wants has value that can't easily be replaced with cash.
posted by three blind mice at 3:38 AM on July 12, 2010


I don't see that as either ingenuity or decline, but rather more economic flattening (in the Thomas Friedman "The World is Flat" sense). I've been involved on the "buy" side of a couple of IT outsourcing deals in the U.S. At this point, all of the big U.S. service providers on the "sell" side of IT outsourcing have moved some of their operations overseas. At the same time, the big Indian providers have found that certain industry segments just won't go overseas because of political considerations and/or security requirements. Those Indian providers have in turn been building centers in the U.S., usually in rural areas, and hiring U.S. citizens to staff them. All of the big players, U.S. based or not, now have the capability to either service your business in the U.S. or offshore. I agree with the earlier posters about this not being new -- this has already happened.
posted by kovacs at 4:11 AM on July 12, 2010 [3 favorites]


Maybe Carlson would be happier being "competitively wagered"? There are no problems that euphemisms can't fix!

(And, honestly, "cheap labor" really is less than flattering.)
posted by harujion at 4:12 AM on July 12, 2010 [1 favorite]


Why bristle at the idea of being "cheap labor"...
In many circles, "cheap labor" connotes a certain level of low quality. It's sort of a way of saying "bottom of the barrel" to a lot of people. There's also a level of desperation. Think: All the day laborers who hang out around the contractor exit at Lowes, hoping to get picked-up by a contractor needing a crew that morning.
posted by Thorzdad at 4:38 AM on July 12, 2010


Snark all you want, but a Fortune 500 company just pulled out of my little country town, putting 420 people out of work - this is fully one percent of the entire population of the county.

We'd love to have one of these outfits come in here and offer above-minimum-wage jobs. And evil commie liberal socialist that I am, I say, give us a call.

And by the way:

hamida2242:
"The cost of living is 23% less than a metro area. Consequently workers are paid 53% less than those in metro areas."

That's not what the article says. It says:
...Jonesboro, where the average IT salary is $35,000, versus $65,000 in a large metro area. The cost of living in Jonesboro is also 23% less than the U.S. average.
posted by tommyD at 4:54 AM on July 12, 2010 [4 favorites]


I don't see that as either ingenuity or decline, but rather more economic flattening (in the Thomas Friedman "The World is Flat" sense).

This was my impression as well. This is an effect of increasing globalization and economic flattening driven by multinational corporations. It's the cost of doing business.

It wouldn't surprise me if the issues Human Genome Services experienced when they used a call center in India happen frequently to other companies. The culturally-created misunderstandings, time zone differences and communications problems -- of special concern since they were probably dealing with subjects that required accuracy in translation -- sound like a pain in the ass.
posted by zarq at 5:18 AM on July 12, 2010


"Cheap workforce!" is usually never a good reason to move your business somewhere.

Unless it's adaptable. If your plan is simply to exploit, it's not a good idea. If your plan is to identify potentially under-explored labour markets and work with them, it's a grand idea. I wrote a paper on Nike's model in Southeast Asia in school a while back. Nike (at the time - not sure about their model now) leased factories and their workforces. It essentially rewarded well-performing factories with higher-profile products and more research and development, and released the poor ones. Short-term contracting of labour allowed them to move quickly to find the best sources of labour, and fostered a competitive atmosphere which valued quality and efficiency over bureacuracy. In turn, factories learned to quickly re-tool and adapt to this model. This is (arguably) good for everyone...

This isn't to open a debate about whether Nike is exploitative or not....
posted by jimmythefish at 5:54 AM on July 12, 2010


If your plan is to identify potentially under-explored labour markets and work with them, it's a grand idea. I wrote a paper on Nike's model in Southeast Asia in school a while back.

Except SE Asia is still an underdeveloped swamp of third-world poverty with a few nice cities ringed with urban slums and subsistence farming. Globalism is a nice concept, built on the post-war success stories of Korea, Taiwan and Japan, but the international players, Multi-nats like Nike, have figured out how to game the system and undermine it completely.

Where's the new SE Asian manufacturing powerhouses? Who's the Thai Samsung, the Indonesian Acer, the Malaysian Sony? I can name a dozen Swedish brands and two dozen Taiwanese brands off the top of my head, why can't I name a single Phillipino one?

Because globalism hasn't industrialized SE Asia, it's indentured it to first-world business interests.

(China has done better, because its government is also gaming the system, and can do so because of their special relationship with the US monetarily.)
posted by Slap*Happy at 6:30 AM on July 12, 2010 [2 favorites]


Paying people to do work is not ingenuity or decline--it's exploitation.
posted by planet at 7:24 AM on July 12, 2010


speaking as someone who hails from an economically depressed area where the small towns are actually the big cities, i know plenty of people who are willing to be exploited and doubly happy to be able to do it without moving halfway across the country. it's true that the skillset isn't just sitting there wilting on the vine, but if the opportunities existed, they would be happy to avail themselves & would be to educate themselves to do so. i think what most people want is a chance to be able to support themselves & their families. it would be nice if they got a little backing from corporate america (and global corporations) once in a while.
posted by msconduct at 7:46 AM on July 12, 2010


I don't see anything particularly eye opening here. Employers weigh the cost/benefit ratio of employing people overseas vs employing them America's heartland, and in this case, flyover country wins. This is a pretty yawn inspiring free market-ish development.

>
It's sort of like how automakers are going to the deep south to avoid the high cost of unions and regulation - but wind up spending as much money on their workforce (to keep the Unions out) and standards/safety compliance (to avoid liability lawsuits) as they would on a plant in Michigan or Ohio.


Cite? It seems safety costs and union suppression might incur costs (particularly union supression) not seen in the older manufacturing centers. But it sounds like you're trying to make a case that automakers left the rustbelt out of spite rather than economics.
posted by 2N2222 at 7:51 AM on July 12, 2010


my start-up that has recently obtained vc could show all of these businesses how to crowdsource labor solutions for an even lower cost. just saying.
posted by the aloha at 7:57 AM on July 12, 2010 [1 favorite]


I'm not a big fan of the writing in the article, but it's an interesting concept. 35 Gs would be a king's ransom to some of the long-unemployed people that I help with job searching on a regular basis.

Part of me hates the system that makes this seem like a good deal, but another part is happy that people are getting better-than-servant level work at a decent salary.
posted by codacorolla at 8:38 AM on July 12, 2010 [1 favorite]


These folks in rural Arkansas and Missouri are getting jobs that are often reported as going to India and other countries.

What, like surrogate mother?
posted by ricochet biscuit at 8:42 AM on July 12, 2010


it sounds like you're trying to make a case that automakers left the rustbelt out of spite rather than economics.

A fairly persistent business myth is that regulation and unionization are obstacles to making a profit - so they went and opened plants in places without a lot of regulation or unionization. No spite at all, just business. It's just that it didn't pan out for them in that regard. (And may have been counterproductive by increasing costs associated with outside suppliers - shipping costs, collaboration costs like travel, etc.)

As a side note, IBM has plants and R&D facilities in remote parts of the US, like Rochester, MN and Montpelier, VT, to make it harder for their employees to seek other positions without completely uprooting and moving across the state, or across the country.
posted by Slap*Happy at 8:55 AM on July 12, 2010


hamida2242: "The cost of living is 23% less than a metro area. Consequently workers are paid 53% less than those in metro areas."

hooray for the free market


Yes, as tommyD pointed out, the article is mixing the average IT salary in Jonesboro of $35k versus $65k in a large metro area, and the cost of living in Jonesboro (23% less than nation-wide average) vs the unstated cost of living in a large metro area (55.82% higher in DC metro area vs Jonesboro "metro" area, according to this cost of living calculator).

My grandmother took my brother and my cousin on a road trip to see where her side of the family grew up, in Kansas and Missouri. We drove through a series of tiny, shrinking towns, all less than 1,000 people. There were dilapidated town squares with less than half the stores occupied, and abandoned houses everywhere, homes that would sell for $100,000 to $700,000 in California, depending on where they were. Being coastal California boys, we were surprised to see so many empty homes. My brother and cousin came up with a plan: move people who had been priced out of California homes and move them to Kansas, re-filling those shrinking towns to at least 1,000 people again. The slogan: Making Kansas Grand Once More. Only then, we didn't know what kind of jobs to offer. This is it: tech-based jobs that are location-independent, which can fill those sad town centers with offices and people again. The people are there, the buildings are there, the infrastructure is there (I'd guess - and if it wasn't, then this would be the ideal time to upgrade the town center). I'm dreaming, of course, but I'm still a bit sad to see those former little towns fade away.
posted by filthy light thief at 9:12 AM on July 12, 2010


I can name a dozen Swedish brands and two dozen Taiwanese brands off the top of my head, why can't I name a single Phillipino one?

I'll be damned if isn't common knowledge that Jollibee is a billion dollar company from the Philippines that serves Chicken Joy, Yum Burgers, and the Crispy Bangus with locations in California, Nevada, and one in Woodside, NY.

Side Note: All their food is sub-"Jack In The Box" and in the years that I used to live in LA I was always tempted to visit but never did because there is always somewhere else that sounds more appetizing.
posted by wcfields at 9:24 AM on July 12, 2010


Who's the Thai Samsung, the Indonesian Acer, the Malaysian Sony? I can name a dozen Swedish brands and two dozen Taiwanese brands off the top of my head, why can't I name a single Phillipino one?

The four countries you mentioned all have serious problems with political instability, high levels of brain drain, large national debts, and little in the way of demonstrated long-term commitment to education.

The next Asian tiger is Vietnam. They have political stability (not democracy, but stable), a small enough population that a few major companies can result in huge benefits for everyone, and are rapidly building a first-class education system. Barring any major disasters, in 40 years they'll be where Taiwan and Korea are now.
posted by miyabo at 9:26 AM on July 12, 2010 [1 favorite]


The automakers that have plants in the north (I despise the word rustbelt) haven't left there - it's the foreign automakers who pretend that they are American who have opened most of the southern plants, so that they could avoid unions, and because of the tax incentives the locals have offered them. The American automaker plants are unionized no matter where they are in the US or Canada.
posted by rfs at 9:28 AM on July 12, 2010


>
It's just that it didn't pan out for them in that regard.

Once again, cite? I have no doubt the auto industry in the US suffers from some problems. However, I am skeptical that dealing with fewer regulations and no unions are a significant source of these problems.

>
As a side note, IBM has plants and R&D facilities in remote parts of the US, like Rochester, MN and Montpelier, VT, to make it harder for their employees to seek other positions without completely uprooting and moving across the state, or across the country.

Now you really seem to be assigning unusual motives to a large corporation. And it doesn't even quite make sense. If Rochester and Montpelier provided a built in workforce for IBM, then it sounds like they were done a favor, allowing them more prospects for jobs without having to relocate. And if Rochester and Montpelier drew skilled workers from other areas, then it seems the workers are no more trapped than before, who were uprooted from their former locales.
posted by 2N2222 at 10:09 AM on July 12, 2010 [1 favorite]


I'll be damned if isn't common knowledge that Jollibee is a billion dollar company from the Philippines that serves Chicken Joy, Yum Burgers, and the Crispy Bangus with locations in California, Nevada, and one in Woodside, NY.

Their food is also completely drenched in MSG. Had the worst migraine of my entire life after eating chicken from one of their locations a year or so ago.
posted by zarq at 10:15 AM on July 12, 2010


...and it doesn't even quite make sense. If Rochester and Montpelier provided a built in workforce for IBM...

Lemme guess - business or econ major?

No, here's how it works in the real world - there's no such workforce in those places. They create one from scratch: they move fresh grads out to the hinterlands of MN or VT or MT with a generous starting salary and name recognition (Hey! IBM!). Once there, their wages stagnate compared to other professionals in their field at similar points in their career who are closer to industry centers.

The choices are 1) Like it, and live underpaid where your family and friends are, 2) Lump it, and interview hours and hours away from home, or overnight planetrip, even, and then sell your house, say goodbye to your friends and your wife's friends and your kids' friends. Turnover of top employees is next to nil.

I used to work for an AS/400 (now "System i") developer, and we had a satellite office in Rochester, MN simply because we knew we could scoop up all the top-talent AS/400 programmers we needed (and we didn't need many) by offering what would be an insulting lowball wage in Boston or even Chicago. I know a chip designer in VT who was really up crap creek when they laid him off - his only option was to short-sell his house and move to Boston.
posted by Slap*Happy at 10:44 AM on July 12, 2010 [2 favorites]


IBM Burlington (not Montpelier) was established in 1957. I don't think IBM located there to prevent chip designers from jumping ship when the first working integrated circuit was demonstrated in 1958.
posted by leaper at 11:18 AM on July 12, 2010


You're correct about Burlington, incorrect about computer designers... unless you think Burlington was a hotbed of electronics and business automation innovation with a growing and competitive engineering workforce in '57. (No, not really.)

So, if there was nothing there, why put a R&D facility there? To keep turnover of top talent nil while underpaying them.
posted by Slap*Happy at 11:26 AM on July 12, 2010


When IBM built its gigantic facility in Rochester, MN, it was indeed surrounded by cornfields. But after a couple of decades of families of engineers and doctors (from the Mayo Clinic) taking root, it is becoming a real city very quickly, with diverse employers and a very high quality of life. I think this is an example of onshoring working right in the long run.
posted by miyabo at 12:06 PM on July 12, 2010


Lemme guess - business or econ major?

Neither. Just a regular guy.

Your example still doesn't work. By your description, they imported their workers. Workers, I might add, with significant specialized skills. If they are trapped, it's because of their own doing, not their employer's. The reason one gets specialized skills is so one won't be owned by the company store. And they aren't.

My heart goes out to the guy who had to abruptly pull up stakes and relocate. But he's a poor example to make your point. Had he not been laid off, it seems he'd still be happily trapped in his old house. And the situation is hardly unique. There are folks everyday who have to relocate from Boston to the likes of Rochester, MN, because jobs in their chosen field take them there.

One wonders how IBM manages to attract workers at all, paying peanuts out in the sticks and all.
posted by 2N2222 at 12:13 PM on July 12, 2010


filthy light thief: "I'm dreaming, of course, but I'm still a bit sad to see those former little towns fade away."

As a native and resident Kansan, I have to point out it takes more than a job to move a person. The residents of those towns have been moving to metro centers for decades for good reasons. The suburbs provide stronger job opportunities, better variety of goods and shops, diversity of culture and people, and a fantastic public education system. In contrast, the small towns are homogenous and usually at the mercy of a single large employer.

This makes it incredibly hard to keep young people. A teen in these towns may have a graduating class of 30. That's pretty depressing odds in dating. So they run off to college as fast as possible. You meet a lot of people, get a degree and see a lot of recruiters willing to send you to Pittsburgh or Atlanta or Redmond or Chicago or Silicon Valley etc.

Suddenly a call center job in a town where you'd be the only person your age sounds pretty crappy. And no call center is going to locate itself in a town where it needs to employ half the place or go under. Instead they locate themselves at the college town, where they can locate a lot of newly unemployed talent. Oddly, the call center in my college town didn't do part-time hiring or schedule around classes.
posted by pwnguin at 1:28 PM on July 12, 2010


They create one from scratch: they move fresh grads out to the hinterlands of MN or VT or MT with a generous starting salary and name recognition (Hey! IBM!).

This trend sounds especially bad for women in technical fields, who are likely to have partners who also have technical careers and aren't going to move to the middle of nowhere.
posted by transona5 at 4:57 PM on July 12, 2010


my start-up that has recently obtained vc could show all of these businesses how to crowdsource labor solutions

Especially once you factor in the cloud and Web 2.0, you could really realign your paradigms and create dynamic synergies that will empower you to move your cheese.
posted by dr_dank at 6:39 PM on July 12, 2010



This trend sounds especially bad for women in technical fields, who are likely to have partners who also have technical careers and aren't going to move to the middle of nowhere.


I'm a woman in a technical field and maybe i'm an outliar, but it sounds awfully nice to not have to live in NYC for $$$$$$$ and maybe move to my family's farm in the "middle of nowhere."
posted by melissam at 9:10 PM on July 12, 2010


I've been involved in a number of "insourcing" projects like this, mostly call centers in rural areas. We used to call it the "Wallmart recycling strategy".

When Wallmart goes into a new area, particularly a rural area, apparently one of the concessions they get out of the local governments in exchange for bringing a bunch of jobs to the area is a significant upgrade to the utilities feeding the store. New power, water, sewer, etc. So, when Wallmart moves on, we moved in and had a first rate facility that we invest little or nothing from a facilities standpoint to get running (cubicles are cheap).

Not sure what concessions our people got to move jobs back into that rural area.
posted by kjs3 at 9:26 AM on July 15, 2010


« Older An interview with caving researcher James M. Tabor...  |  As Uganda reels following a bo... Newer »


This thread has been archived and is closed to new comments