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The latest in outsourcing
Posted by: mcq on Friday, February 02, 2007

Your news:
In a windowless office in central Bangalore, dozens of employees are arriving to work on the night shift.

They are journalists employed by the world's biggest news agency, Reuters.

Their job is to cover US financial news.

And they are working overnight so that they can report company news live as it happens on the New York Stock Exchange - from India.

But why in the world is Reuters covering Wall Street from Bangalore?

In a word: salaries.

These Indian financial journalists can be employed by Reuters for a fraction of the cost of employing a journalist at their New York office.

Reuters Editor-in-Chief, David Schlesinger, says that the move meant that they could broaden their coverage of US companies without incurring crippling costs.
Welcome to the global economy and the facts of economic life. Labor cost remains a cost of doing business and is reflected in the cost of goods sold. In an increasingly competitive environment, moves like this make sense. A predominantly English speaking country with journalists who will work for much less than journalists in the US coupled with almost instant communication and access to the same info and their US peers can easily replace the US workers.

Of course David Schlesinger puts as good a face on it as he can and notes that instead of laying off people in the NY office, they can be assigned to different types of stories and "broaden their coverage" of the news.

So despite editorials in major dailies lamenting outsourcing in general, it seems that the news industry has suddenly discovered its benefits. Remember that the next time you read a story in the NYT or WaPo agreeing with a politician condemning outsourcing.

It may have been written in India.
 
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Previous Comments to this Post 

Comments
It seems to me that boards of directors of Fortune 100 companies could find Indian executives who’d be willing to work for far, far less than the CEO’s they’ve been hiring.
 
Written By: Dave Schuler
URL: http://www.theglitteringeye.com
Mr. Schuler has made a clever comment. That it is the only one on this thread is a sorry comment on the readers of this internet magazine. The outsourcing of IT jobs (and others) is a major occurrence in American history. Thousands of Americans are underemployed or have sought employment in other industries because of this phemomenon. Not a good thing.
 
Written By: notherbob2/robert fulton
URL: http://
If those CEOs can do just as good a job, I say "Go for it."

Alan Blinder at Princeton wrote up a good paper on outsourcing; give it a read, if you have the time for about 30 pages. If you’re the impatient type and don’t want to know the argument behind the trends, skip to the last two pages.
 
Written By: Bryan Pick
URL: http://www.qando.net
In the short-run outsourcing will hurt many of us, but in the long run,
it will eventually be very advantageous.

The immediate effect of outsourcing will be lost jobs in the U.S.
Yes at first there is going to be a small rise in unemployment. Of course no one
will be happy about that. But think of it this way, less developed countries,
will become wealthier than they were, and be able to buy more American goods. So the demand
for U.S. jobs will come back up, but it will take awhile.


Offshoring/outsourcing causes wealth to be redistributed naturally, diverting income from
wealthy nations to poor ones.
 
Written By: Amy
URL: http://www.agentsofvalue.com

 
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