Conference 7.286::digital

Does it save DEC money to move a "foreign professional" to the USA?
In engineering, at least, the import gets paid on the same payscale
as U.S. citizens.  And the way it worked for transfers from DEC-elsewhere
to DEC-USA, at least when I was a recent import, was that if you
were at N% of scale when you worked elsewhere, you'd be placed at
N% of scale in the USA. 

So the cost of running an imported engineer in the USA is at
least the same as running a homegrown one.  Add to that the 
often-substantial relocation costs, plus the not-insignificant
costs of DEClawyering for things like green-card applications,
and I don't think you'll see much of a win.

The situation may be different outside engineering, I suppose.

There was an article in the Toronto Star back in October that talked about 
this.  What corporations do (namely a large US-Based corporation that is a 
major player in PC software which Digital now has a broad-based agreement 
with) is get the software designed in the U.S. but farm out the progrmming 
work to places like India where the labour is a fraction of the price in the 
U.S.

So far, in dealing with Digital engineering I haven't found this to be the 
case for us.

/Mario

    Check out where AMEX does its data processing of all those charges you
    US-citizens make.
    
    I think you'll find the DP's done off-shore.

many of the applications were for hong kong, which reverts to china soon.
i've heard two stories about it, and do not know if 0, 1, or 2 of them are
true.  1. access to u.s. is strong inducement to let other countries
open the doors for them.  2. promise of admission to u.s. makes hong kong
dec employee more willing to try china after 1997.

if hong kong thrives after 97, the rest of china may follow.
if all of the people that give hong kong its value leave before 97,
then there is no reason (except previous promises) for china to treat
hong kong any different than other provinces.

Was the article clear on whether the visas were permanent or temporary ?

Looking at the numbers, my guess is this includes temporary (usually 3 years or
less) visas.  Digital still needs to apply for and sponsor a non-US citizen for
a temporary work visa.  Having worked with some DEC India contractors here, I
know the intention of that program is for them to work in the US for a temporary
period, get experience and skills, and take it back to Digital in India.

Whether 'temoporary' visas actually take jobs from US citizens is another question,
but at least we should be clear on that data.

By the way, I also know of a number of US Digital employees working in, or who
have worked in, Europe - so it goes both ways.

Martin

    re .0
    From ComputerWorld: Hewlett Packard just this week announced that
    it was stopping the program that brought programmers over from India
    and other countries on complaints that they were being paid only for
    living expenses.  Coincidentally, the group I'm in went thru a large
    downsizing effort last year and is in the process now of bringing in 11
    DEIL (Digital Equipment of India Limited) individuals.  A sample H1B
    Visa disclosure can be seen inside the lobby of LJO2 (they have to
    post the salaries, together with check marks next to requirments
    that say they are not replacing any US jobs).
    
    I imagine HP's legal department thought it would be a good idea to
    stop the process there.  Wonder how many law suits it takes for DEC?
    KB  

    Read Ed Yourdon's book "The Decline and Fall of the American
    Programmer." It is a wakeup call to the great unwashed masses of
    engineering. Read it and re-read it. It is out in paperback for $14.95.
    He talks about software and DP work moving offshore. Tata is high on the
    list of Asian companies doing SW work for US corporations. Texas
    Instruments, where BP and I both worked at one time or another, is
    working very heavily with them.

    The far greater threat to American engineering jobs is work moving
    offshore rather than foreigners coming to the US. In the information
    age, who cares if your conference call is from Maynard to Nashua or from
    Maynard to Delhi? It's just as easy to copy source and executables from
    a VAX in India as from one in Colorado. Talk about your virtual office.
    Comm charges are higher, but those are significantly offset by the
    overhead costs of the engineering group who is paid at 1/10 the salary
    of US engineers. Cultural and language differences are something of a
    barrier for foreign development of SW for the US market, but as foreign
    companies gain experience, they will overcome that. SW engineering
    itself will become a commodity just like the SW it produces.

re Note 2783.7 by NPSS::BRANAM:

>     In the information
>     age, who cares if your conference call is from Maynard to Nashua or from
>     Maynard to Delhi? 

        Obviously, you haven't had to set up many intercontinental
        conference calls.  The time zone differences make it tricky.

        Bob

	Re. last few

	Perhaps it is worth noting here that most of us in the US are either
	immigrants or children of immigrants or children of children of ....

>    	A DEC spokeswoman says that the computer maker requested the visas
>    to speed transfers from its operations in India to the U.S. and that it
>    actually brought only 50 foreigners stateside.

  I'm confused. Are these permanent Digital employees who are temporarily
working in the U.S., or are they contract workers?
  When I was a member of IEEE (before 1992), there was considerable discussion
about this. One thing that was mentioned, and is probably also mentioned in the
book, is that Indians programmers are, on average, better than U.S. programmers.
Therefore, companies may feel they can come out ahead by bringing Indian (and
other?) programmers to the U.S. even if they are paid the same salary as U.S.
programmers.
  As was said a few replies back, the major concern is not bringing in foreign
programmers, but U.S. companies having the work done by non-U.S. companies
outside the U.S. For U.S. programmers, the challenge is, can we become good
enough compared to non-U.S. programmers that U.S. companies will find it more
cost-effective to not move the work offshore? Other things being equal, it is
still more efficient to do the programming locally than remotely, even though
modern communications makes it easy to move software back and forth halfway
around the world.

RE .8 - No problem. US engineers call into DIBS at 3:00 AM EST
so the offshore people will not be inconvenienced ;^)

    In our Unix Client/Server training a few weeks ago, this topic came up
    with a humorous spin to it.  The training folks mentioned how Platt
    from HP was running from the 60 minutes cameras as the questions were
    posed for his comments on why HP was using Indian programmers to offset
    costs.  The story goes that Digital's marketing called in to CBS and
    said they we're doing that too, why didn't you ask us for the interview?
    
    Sad...
    
     /john

    re: a couple of "I'm confused" replies looking for more info:
    
    I don't have any more info.  I don't know if the visas are permenant or
    temporary.  I shared everything from the article that looked relevant
    and left out the rest to save my fingers and disk space.
    
    Something else is bothering me about this whole string I started.
    
    I preach the gospel of free enterprise.  I think protectionism is bad
    for everyone.  Bigotry and racism are forces I believe may blow up the
    whole world.  These should be fought everywhere.  And I just love good 
    rags to riches stories.  Those stories about people who come ashore to 
    this country with no money and no english - and 10 years later are
    prominent business owners - give me a warm feeling in my heart.  This
    kind of stuff is what our great country is all about.
    
    And I hesitated posting .0 for a long time because I don't want to stir
    up hard feelings between U.S. and non U.S. people.  I'm really glad
    none of the replies so far in this string have any hostility of that
    nature. 
    
    The more I think about this topic, the more painful it gets.  Consider
    that in our office in Minneapolis, more than 2/3 of the people who were
    here in July 91 are now long gone.  Like offices everywhere across the
    U.S,, some were goof-offs, but many of these good people were just in 
    the wrong place at the wrong time.  
    
    So how would I feel if I found out one of my friends was fired from a 
    job and replaced by somebody from another country at 1/10 the wages? 
    This is a what-if and hypothetical question for me because it hasn't
    happened yet.  I hope I would not be mad at the newly hired person. 
    The company politics and problems are not his/her fault.  I think I
    would be furious at the decision makers in this company if I were to
    find out this is going on.
    
    - Greg Scott

    
    Perhaps the title of this topic should read
    
    "Are expensive employees at risk from less expensive labour sources"
    
    Not just a US issue -- applies in Germany, UK, Scandanavia (add your own
    target here) etc etc -- anywhere where the personal unit cost is higher 
    than equivalent skills can be bought elsewhere.
    
    Issue is wider than just that of an imported work force. Resource 
    (people, facilities, capital) substitutability is one of economic 
    benefits of telecommunications & computing, as any business school 
    lecturer might say .... Jo in the Public Bar might well say "This is
    getting scary", although possibly in a more descriptive way.....!
    
    
    Colin
    
    
    
    Colin

    
    well, as automation become more wide spread, the issue of the cost
    of labor will become moot.

    because we'll have computers doing many of the tasks we do now, it is
    already happening in many aspects, from robotics to design. today
    one engineer using modern computer tools to help him or her, can do
    the work of 5 or 10 engineers just 20 years ago.

    now days very complicated design can be done more accurately and in
    less time and with less human-person-power than before, and as we
    automate more, and computer become cheaper and faster and software
    becomes more advanced and more technology developed, less and less
    people will be needed to do the work, because it is almost all
    automated.

    the ones who will achieve successes in the future are the ones who are
    smart and will automate and become more efficient and faster.

    we should not let the train passes us by.

    we should look ahead and be bold and not let the wind sway us
    back and forth, we should hold on to the storm of changes and
    look to a bright and shiny future with more mountains to conquer and
    more seas to sail.


    just some thought on this, since the subject of labor cost and labor
    resources came up i thought i throw my 2 cents in.

    \bye
    \nasser

	10 years ago I worked for the SW Engineering group at the Burroughs
	plant here at Livingston in Scotland. 
	
	In order to bring projects in on time and within budget the company
	brought in engineers from the Indian subsiduary of Burroughs which
	was called 'Tata Burroughs' (Is this just a coincidence I ask myself). 

	As far as I know these engineers were mainly paid through the
	subsiduary, and lived on expenses while in the U.K. This worked in
	favour of the company because the expenses could be offset against
	tax, and the personnel overheads were lower because the Tata people
	were classed a contractors.

	The standard of engineer which Tata  Burroughs supplied was quite
	high in my opinion. Most of them were very good at their jobs.
	Those with less experience more than made up for it with enthusiasm.

	If companies can develop high quality software more cheaply using
	engineers from areas of the world which western news programs like
	to refer to as the 'Third World countries' then they are going to
	do it or be forced out of the market

/Duncan

    
    Digital sells 63% of it's products & services outside mainland USA, in
    many countries where the first language is English.  Frankly, US
    programmers still need to develop skills in designing and building
    international products.  This infusion gives us the skills to be able
    to service one of the fastest growing (12% per annum on a bad year)
    markets - Asia.  If any of you listened to NPR this morning, you would
    have heard a Microsoft representative talk about Chinese Windows to the
    interviewer.  That Microsoft rep wasn't US born either.
    
    Secondly, Digital wants to do business in India.  Unless the situation
    has changed recently it cannot have a wholly-owned subsidiary, and the
    interest is partly owned by the Indian Government.  This action may
    therefore reflect some horse-trading with India to leverage our
    business position there.  It also gives us skilled engineers trained in
    US techniques that we can use to staff our subsidiaries in future.
    That's unless any of you want to learn Urdu or Hindi and relocate? 
    
    The point is, the importing skills or exporting work is not just about
    the basic cost of the skills.  It's a strategy that generates business
    which keeps us ALL in work, or increases foreign market share.
    
    Colin
                                                           

    As a person of Indian origin who has been with Digital ,USA for 21
    years I can empathise with many of the concerns of US based software
    engineers about job security. I also detect a tone of understandable
    resentment on the part of some of the noters for these foreign
    programmers. I am worried about my job too .
    
    It is pure economics, that is availability of qualified
    programmers for a fraction of the cost of US programmer , that makes it
    attractive for US companies.
    
    The TATA consulting (TATA Burroughs etc. )is a part of a very large Indian
    company 50 to 60 years old , that is into steel , automobiles ,
    Mercedes trucks ,software etc. IBM has an agreement with TATA's on
    AS400's. 
    
    Many other major Indian companies who are in other lines of businesses
    have ventured  in to software . The Imperial Tobacco co,
    the United Breweries ,Delhi Cloth Mills etc. are all into software .   
	
    There is a large pool of "English (queen's) speaking graduates"
    available in India for the picking. You do not have to learn Hindi or
    Urdu to survive in India . Many of the top graduates from the prestigious
    Indian Engineering Institutions end up in the US doing post graduate
    work .
    
    Sini.
                                                

    Some of you may have noted that this morning the flight attendants
    union struck American Airlines. Reportedly, over the past several years
    they have taken a 10% roll-back in wages and benefits (cynical chuckle
    here from DECies who have been hurt far worse). American is reportedly
    going to replace those on strike with non-union attendants [Note:
    federal regs dictate the number of qualified flight attendants that
    must be carried on any commercial airplane; it is not optional].
    
    In the past 8 years the US airline industry has been butchered by both
    domestic deregulation and international competition. After the CAB
    deregulated US airlines, the bottom fell out. The bottom is still not
    in sight. It may be that in a few more years there will be 3, or 2, or
    1, or even _no_ US airlines. Costs are so high and competition so
    savage that the long-protected US airline industry may never recover.
    
    Pilots, flight engineers, attendants -- you name the position -- are
    plentiful overseas and will work for a fraction of what US people
    demand. Large flight schools in the US (mostly in fair-weather places
    like Florida and New Mexico) run 'ab initio' training for boatloads of
    foreign nationals who come here on student visas, get their US flying
    licenses in the minimum required time, and then go looking for jobs.
    Most return to their countries of origin, but many stay in the US.
    
    Yes, there are still a very few major airline captains' jobs that pay
    as much as $200,000 a year for 12 days work a month. But the typical US
    airline captain now makes a lot closer to $50,000; $30,000 isn't
    unusual, and copilots start at as little as $12,000 a year, with no
    benefits and no vacation time [one airline personnel manager confided
    to me that, in order to be a new airline copilot these days, "you have
    to still be living with your mother and be able to walk to the
    airport."] The typical regional airline copilot is thus 23 years old,
    has the minimum flying time required to get the job (less than 1,000
    total flying hours), and is making $12,000 a year. On the other hand,
    you get what you pay for. Al Haynes saved the Iowa City flight from
    total disaster by virtue of enormous experience and qualification. An
    800 hour copilot would have gone straight into the ground with no
    survivors.
    
    Get used to it. The world economy is here and changes in all industries
    follow.
    
    Once again -- you get what you pay for. So, the real question is: what 
    is the minimum you will accept, in return, from discount work?  
                                                                       

    fyi, 

    this same topic is being discussed extensively also in 
    sci.research.careers.

    \nasser

	Re. .17

	> Unless the situation
    	> has changed recently it cannot have a wholly-owned subsidiary, and 
	> the interest is partly owned by the Indian Government.

	The situation has changed in the last year and half. Previously, a
	foreign company could have at most a 40% stake in an Indian venture,
	now I think it is upto 60% or may be even 100%. Indeed, Digital
	raised its stake in Digital India from 40 to 51% after the change in 
	this law to make the latter a subsidiary of Digital rather than a 
	separate company. Dick Poulsen is the Chairman of the Board of 
	Digital India. 

	Also, as far as I know there is no requirement of govt. ownership, 
	and I don't think the Govt. of India holds any stake in Digital
	India. 

    .21
     Thanks for the updated information!

    	So, where do persons who develop and sell their skills in the
    computer and airline markets end up in their native socio-economic
    terms? Is there a major advantage to them in their homeland or can
    their skills only be highly rewarded if they immigrate to the U.S.?
    
    Phil
    	

    -.19
    
    Very good point regarding the dereg. and all.
    
    I think what we are seeing is the regulations that were in place, put 
    an artificially high cost for personnel in the airline industry.  And
    without it, we can not compete with the other very capable, yet much 
    lower priced workers in the world.  I think we (U.S.) are in for some
    real suprises in relation to our pay for performance.  We may be on 
    a trend of lower still standards of living.  We don't own the
    industries that made that high standard of living sustainable 
    anymore.  We need a NEW industrial base.  Could it be space? 
    Metals?   
    
    Just speculating.  Now think about the NAFTA factor on this.
    
    mp

  Re .19: The thought of copilots earning a starting salary of $12K is quite
scary, both for the copilots themselves and for airline passengers. This is
below the official poverty line, right?
  The fact is that commercial aviation is very expensive, and always has been.
How much of this cost is passed on the public via fares depends on how much it
is subsidized by government at all levels. High government subsidies mean arti-
ficially low fares, and that is what we had in the 60's and 70's.
  I sympathize with the airline employees who have lost or will soon lose their
jobs, but fewer people are flying and that means fewer airline jobs and air-
lines.

    Today's Globe:
    "Department of Labor said Digital Equipment Corporation has agreed
    to pay more than $45,000 in back wages and fines for violating
    immigration laws by underpaying 24 foreign workers.  The Maynard-based
    computer company also has agreed for three months not to participate
    in the H1-B program, under which US companies can bring in foreign
    workers temporarily for hard-to-fill-jobs - in this case, computer
    programming."  It goes on: "Nikki Richardson, a DEC spokeswoman,
    stressed the pact was not an admission of guilt".  [Nice spin control
    there, Nikki; too bad large corporations like us have yet to learn that
    that's the exact wrong thing to say; plus it damages your personal
    credibility in future press releases].
                      
    BTW, I guess the U.S. Labor Department must get Business Week ;-)