Maxmosbey
Final Approach
- Joined
- Aug 23, 2007
- Messages
- 5,247
- Location
- San Juan, PR/Ames, IA
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I need to get serious.
Unfortunately, it's never that simple.
Transportation costs and quality (or, more specifically, the cost to replace defective items) increase the costs for goods and services off-shore. Services that can be provided remotely (help desk, programming, reading x-rays, etc) are subject to data and telecom costs which remain comparatively low (but quality of help desk/offshore call centers is a service quality issue).
When economists speak of "what we need are jobs, it doesn't matter whether it's private or public" miss the fact that at SOME point public employment gets to be such a large percentage that the taxes on said wages cannot support the much higher salaries paid. Entropy applies to tax/public employment - and there is some point where even "tax the rich" can't make up the difference. I'm sure that point can be calculated within an order of magnitude by economists - I don't know where the tipping point is, and frankly, that's a discussion better had in Spin Zone. Setting spending/taxing priorities is a political matter.
Yes, pensions are an issue. Most employers have eliminated defined benefit plans. Even the Feds jettisoned new DB plans years ago. But some state and local jurisdictions still employ them. Unions are a factor, but not THE deciding factor in that equation. And yes, taxpayers pay for those pensions, either directly or indirectly (direct payments to the investment plans/annuities or by reducing employee pay).... all compensation, direct and indirect, for public employees comes from the tax base.
So the decision to create a job here vs offshore is a factor of transportation, ease of management, direct labor, indirect labor (pension/benefits), taxes, availability of needed skill sets, social/moral factors (child labor, "green" initiatives, energy, etc), regulatory requirements, resources, and other costs that enter into the equation. For example, there's a perception that certain parts of Appalachia and the the deep south would be "low wage" areas - yet one might not find sufficient levels of the skill sets necessary in those locations. This inextricably leads back to education & other cultural factors.
I won't even get into the fact that some companies in some industries have folks on the payroll that are effectively "retired in place"......
Like you, I've started and owned small businesses. I've had to "rightsize" companies, and I've done merger integrations that have resulted in revamping the payroll. None of it is easy, and there really are no simple answers.
This does not have anything to do with keeping people employed, but it does have to do with perceptions. My wife is into the green movement and she is very sensitive to the "carbon footprint" and sustainability. We have been reading a lot about bamboo. So we talked to a "green" designer about remodeling our bathroom. My wife wanted bamboo because of its sustainability. The designer said that he does not recommend bamboo. They can not process the bamboo where it is grown and harvested, so it is sent by trucks to the railroad yard. There is is shipped to a seaport. If you are looking for real good bamboo products, they are manufactured in Europe. So from there it is shipped to Europe by boat. Then it used to manufacture the product, which is shipped by truck, rail, and ship, to the US. He said that the carbon footprint was enormous on bamboo products. Who would have thought? I just found that interesting, because common thought is that bamboo was such a ecologically friendly material. As a material I guess it is, but as a product it isn't.