Taxes have also contributed to this job flight. It is just cheaper, tax-wise, to run a vacuum cleaner assembly plant in China than it is in Bloomington, Illinois. Which is why Electrolux has off-shored its manufacturing—and is getting ready to move its Corporate HQ to North Carolina.
While this may wound American egos, other countries have found ways to develop workers who are just as good at certain jobs as any American. India produces outstanding English-speaking computer programmers and analysts—and State Farm Insurance has been tapping this talent pool for a long time. China produces outstanding factory line workers—as Electrolux has learned.
There are of course certain jobs that only can be done by Americans, chiefly because the job or service has to be done here, in person. A line cook at a restaurant, a mechanic to change your oil, a nurse, a lawyer, all are examples of Direct Service jobs that aren’t going anywhere, aren’t Transportable. Those are the jobs that are “secure” into the future—even if they don’t all pay that well.
But there are many jobs that are Transportable and will be moved off shore.
How secure ARE the State Farm jobs?
Any job that involves data entry, analysis, or manipulation is Transportable. Perhaps as much as 75% of all State Farm employees at Corporate headquarters today have jobs that could be done by people living on the other side of the world. Workers in the State Farm Customer Response Center could be picked off quickest, but Underwriters at the top of the SF food chain are also open to being outsourced. Information is portable—Information doesn’t care whether it’s handled in Bloomington or Bangalore. You don’t have to be an American to figure out somebody’s insurance policy.
Any manufacturing process for the creation of a ship-able object is also open to being outsourced. No, you probably won’t see Boeing 747 assembly jobs going to China. But you will see the sub-assembly of the parts for the 747 moving East. If you’re waiting for Dell Computers to open a plant in Normal—forget it: Dells are built in China. The next auto plant opening will be in Mexico, not McLean County. These foreign workers do just a good a job as any American—and at half the price.
This trend towards the Flat world started around 1990, Friedman says, at the time of the collapse of the Soviet Union. So we’re already twenty years into the Flat World. Yet there are many Americans–and Illinoisans–who still just don’t get it, mostly because they do a lot of talking and posturing, and very little reading and thinking.
“Create more Jobs!” the electorate scream at candidates Bill Brady and Pat Quinn. “Protect us from Corporate Offshore Outsourcing,” we yell at Kirk and Giannoulias –and Halvorson and Kinzinger.
But what we’re calling for—Dems and GOPs alike—perhaps isn’t possible to achieve anymore, not in a flat world.
We can’t force Business to create more jobs in Illinois—at least not jobs for low-skilled factory workers. Not going to happen. Chinese labor is better for Business.
We’re not going to get any more new jobs in data management either in Illinois. Indian labor is better for Business.
Business is, after all, in business to make money, to achieve profits. To buy low and sell high. That’s classic Capitalism. Any Republican who turns beet red at the idea of Business off-shoring jobs doesn’t really support the basic tenets of Capitalism. Tell stockholders they won’t be making any money this year off their investments because their company was forced, politically, to hire American Labor exclusively. Yeah, that’ll go over big.
Without the Chinese component, Wal-Mart is toast--and so are American consumers.
Business is also in the business of making products more affordable for consumers. Any Democrat who goes into apoplexy over sending jobs to China, apparently doesn’t shop at Wal-Mart. Without the Chinese component, we wouldn’t be able to buy 36 inch LCD television sets for under $400. Or shoes. Or –you name it. America would go belly up in ten days if everything sold at Wal-Mart today was priced based on American Labor standards.
Republicans and Democrats alike can forget the old path to economic success through the creation of rich manufacturing and information-processing jobs, packaged as the slogan/promise of “Attracting New Business To Illinois.”
It’s not just attracting New Jobs, it’s attracting the right kind of New Jobs, jobs that can only be done here, on site. We need to shoot for far fewer Labor-backed manufacturing jobs and more towards Non-Union white collar jobs, —and, at that, jobs that don’t orbit around Information Processing.
So any candidate who really wants to save Illinois has to focus on Direct Consumer Service jobs and Construction jobs.
Workers in Illinois who are looking for jobs, or looking for more job security in the future, need to get training and re-training so they can compete with Indians and Chinese –and beat them at the game—chiefly because they are more skilled than their Asian counterparts.
Education is the answer here. We need to transform Factory Workers into Teachers, and Data Entry Clerks into Restaurant Owners. Better public schools, more community colleges and trade schools, and more access to four-year colleges is the only way to get Illinois back in this game.
So whether it is Pat Quinn or Bill Brady who ends up in the Governor’s mansion in Springfield in December, the solution to Illinois’ financial woes is clear: embrace the change. Buy a clue—and start transitioning our state from the Old Round World to the New Flat Reality.
If either gentleman fails to do this, I’ve heard the weather is nice in Bangalore.
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