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Originally Posted by mikemhg
I'm curious your guy's thoughts on this subject, lately its consumed my thinking, specifically to outsourcing.
We watched back in the 80s/90s the complete decimation of manufacturing in NA, and as a result we saw many cities throughout the rust-belt whittle away, along with the middle class and its blue-collared workers associated to it.
What I'm finding fascinating is we're seeing this at an accelerated process in the white-collar sector. Funnily enough, South Park covered this on their most recent episode, but working in IT this topic has consumed me over the last few years. TELUS's recent layoffs is a perfect example, along other industries.
We always knew administration and administrative work would eventually be automated and whittled down over time, but now I'm seeing a massive increase in outsourcing in the IT sector. Companies are actively cutting staff and shoring roles in coding, support, help desk, implementation to places like India and Philippines. This was certainly a thing a decade ago, but it seems to have grown precipitously in the last few years.
Many of these companies have reached peak productivity and as a fiduciary duty to their shareholders have to produce more value, the easiest way to do that is with outsourcing. I've never seen such a pivot in such a short amount of time in so many industries as of late. It's almost like we've ran out of ideas on innovation and creating value for investors and this has become our last stab at producing growth.
I truly think this is going to be a huge problem in the western world, and I don't understand why more people aren't talking about it. It's like we ignored the problem because it only affected manufacturing (not us), but now it's right on our doorstep.
It's very concerning and a subject I wish more people were engaged with.
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It's inevitable as our technology grows and our labor cost continue to increase.
It used to be cost-prohibitive to outsource as communication was so darn expensive. Now, the cost of communication is near 0 while the wage continue to increase.
Why do you think there's so much money pouring into AI? As human resources cost continue to soar, it makes more sense to invest into alternatives that can reduce as much human labor as possible. Human resource is a relatively fix cost. Thus, if you can save a dollar in any fix cost, it's a dollar earned.
Sometimes, I think in North America... we are fucking spoiled. We think that we, as human or labor, is important. And that's true... until they can figure out how to do it cheaper.
A call center in India can be 1/10 of the cost of operating in NA, with maybe 10 times the productivity (they make up in numbers). That's the reason why manufacturing all started shifting to China. They offered labor costs unimaginable by NA standard.
And for any liberal, or those who are still considered liberal because I used to think I was liberal, your support in liberalism is digging your own grave if you are not 1%er. As we demand more benefits, more wages and more everything... it just accelerates the investment into alternatives.
The day AGI, or even just functional purpose-specific AI becomes common place, you can see all those entry-level jobs disappear. Businesses have no problem spending millions or even billions on something to replace their labor force if they know they would never have to worry about labor costs ever again.
All those complaints and strikes from labor unions? Businesses cave in because alternatives are more costly, for now. The moment the alternative costs the same or cheaper, they would all switch without a second thought.
Don't tell me it's not possible. Take a look at the petroleum market. They pushed the price up so high, to a point where spending billions on research for technologies like fracking made sense. They all poured in. Once the tech is there, there's no turning back. Supplies are no longer limited to "easy oil" like those from the OPEC, but also those from oilsand, fracking, offshore drilling... etc. How do you compete in labor market when the competition would never fight for fairness, wage increase or benefits?
I was just watching a Taiwanese documentary on India... and those people are working in extremely harsh environments and standards. And yet they work like crazy. What left me in awe was how different we are from them. They work for survival. What do we work for? Political correctness?!
How do you expect our labor market to compete with them on hard labors? We can't.