Layoffs up – for you and me


A year ago I said that American workers would suffer huge layoffs…but that the guestworkers replacing us would not be laid off. We, I was right.

And once again, American workers are being laid off by the millions. But not the guestworkers being brought in to replace us.

Infosys has no lay off plans

CHENNAI: IT major Infosys has no plans to lay off its employees and is going ahead with placement of all the 18,000 candidates who were extended offer letters.
Asked about the US Government’s decision on restriction of H1B visas and the stimulus packages, he said, “Right now, I see there is no impact…” he said.

The (Former) Economics of Child Care


When I was a rug rat, my mother got divorced and got very little in child support. She managed to get a job at the “Five and Dime” and got paid a dollar an hour (this was a while ago…), making forty dollars a week.

She had to find a babysitter for me. The babysitter she found got paid twenty dollars a week, and babysat four children, making eighty dollars a week total. Twice what my mother was getting. Half of my mother’s weekly wage. Back then babysitting was a reasonable job. Not any longer.

At one time, service jobs paid a living wage. Until the “haves” decided that they could get away with paying less than a living wage. When there are ten jobs and nine workers, wages and benefits rise. No matter what laws you pass. When there are ten workers and nine jobs, wages and benefits fall. If you bring workers in from other countries, you can guarantee a surplus of labor, and you can guarantee that wages and benefits and worker protections will fall. No matter what laws you pass.

Baby Boomer Retirement? We Wish!


I’m a baby boomer. After 18 years with one company I was forced into “early retirement” when I was still in my 40s. Obviously I couldn’t actually retire since I’d have gotten a pension of about ten dollars a month. So I became a contract programmer, no job security, no benefits, just money. Which was OK until the Fortune 500 began replacing all of us with guestworkers and then offshoring. So for the last eight years I’ve been making a quarter of what I did before, mostly getting short term jobs fixing what the guestworkers screwed up.

Well, eventually I will have to actually retire. Or will I?

Every year, when it comes time for the next H1B guestworker lottery, we get weeping and wailing from the Fortune 500 about how they need an infinite number of foreign guestworkers because when my fellow boomers retire there will be fewer American workers replacing us.

But they are lying, because I will never be able to retire, and neither will many of my fellow boomers. We will have to work until we die in our tracks, because we are being forced out of jobs with retirement benefits into jobs with no benefits, being forced to take jobs that pay half to a fifth of what we used to get paid, if we can find jobs at all.

I have friends who used to be computer geeks who are now nurses, truck drivers, or working at grocery stores. They could still do the jobs that are now being done by guestworkers or offshores, but no one wants to give them medical or retirement benefits, and no one wants to give them any training (they’d prefer to hire someone who lies on their resume).

So we are doomed to have a huge number of unemployed or underemployed older workers being a drain on the economy rather than a boost. And all the cost savings from hiring cheap foreign labor go to the upper management., not into lower prices for consumers, nor higher dividends for stockholders, nor better wages for remaining workers.

Is there now a significant lack of skilled IT workers in the U.S.?

Executives are being told by their hiring managers that there are not skilled workers in the U.S. and they must seek H-1Bs to fill positions

How economic conditions affect retirement decisions

Younger workers struggling to find a job now have something else to worry about: older workers with little choice but to keep working, even in a weak labor market.

Comfortable retirement a fading dream for many

She’s already put off retirement several years. Now, she says she may have to stay on the job four or five years more.

The Lifeboat


I’m watching Titanic again… When disaster strikes, we head for the lifeboats. If we have no lifeboats everybody dies. If the lifeboat takes off with too few people in it, people die. If a lifeboat tries to carry more people than it can hold, it capsizes and everybody in it dies.

I’ve been suggesting that this country (and the entire world) might just collapse, whether soon or half a century from now. When the cheap oil runs out, our food (which is totally dependent upon cheap oil) runs out, and world population , currently six billion and soon to rise to nine billion, will die off, possibly down to one billion.

I have no problem with my hope that those I love, family and friends, will be among the one billion who live rather than the eight billion who die. But life will depend on lifeboats, whether those lifeboats be countries or small tribes. I see our country as one lifeboat, but the lifeboat is already overloaded, at least once the oil runs out. Before cheap oil our country was able to support one or two hundred million people. We have over three hundred million and soil sadly depleted by use of petroleum-based fertilizers instead of sustainable agricultural practices.

Gee, it would be wonderful if the capitalists were right, and we could support an infinite population, with everybody supporting their family with jobs at WalMart. But I doubt the future will come out that way.

What I see currently is the normal split between Conservatives and Liberals. The Conservatives want just a couple lifeboats (perhaps in Paraguay) to hold themselves and maybe their immediate family, and the Liberals eagerly inviting everybody in the world to jump on in.

Between them, I’m not feeling hopeful.

Desperate Shortages?


Every time corporations want to increase the quotas on guestworkers they repeat the same tired old lies about a supposed “desperate shortage” of workers in some field or other. Actually under capitalism there can never (by definition) be a labor shortage in any field. Any temporary shortage is quickly followed by a rise in wages and benefits until the shortage is alleviated. No wage increase, no shortage.

So should you send your kid to college to study science and math and engineering to alleviate the “desperate shortage” showed by current lowering enrollments in those fields? Hmm:

…the fact is that university enrollment in science programs has historically risen and fallen in almost perfect correlation to the opportunities in the job market.

…the U.S.-born scientist as a practical matter really only has access to the scientific job market in the United States, whereas his or her European counterpart has access to opportunities in the United States and the European Union.

…if there were indeed an undersupply of scientists, you?d see hyperinflation of salaries, which of course is simply not the case in any field of science. For example, a graduating Ph.D. in physics at Lawrence Berkeley National Laboratory in California currently receives a starting postdoctoral salary between $39,312 and $55,788. The other national laboratories and the National Institutes of Health offer similar salaries. According to the laws of labor economics, if there is no hyperinflation of salaries, then there can be no labor shortage. However, I do think that there is a shortage of U.S. citizens who are willing to spend 10 or more years to get a Ph.D. in physics for a starting salary of $39,312 a year.

…we were able to identify only 11 African American Ph.D.-level physicists with career positions in the major DOE-funded national laboratories. This was out of a total of 3200 Ph.D.-level physicists employed by the laboratories. Out of the top 20 physics departments, there are only two African Americans in tenure-track faculty positions. What we conclude from this analysis is that foreign nationals are preferred over African Americans in hiring at these facilities.

…the income of a foreign national with a J-1 visa, typically used for postdoctoral appointments, is not subject to U.S. income taxes. This puts the foreign national at a 15% salary advantage compared to the U.S. citizen in the same postdoctoral position.

My daughter went to a high school whose purpose was to persuade kids to major in science, math, and engineering. I’m glad she resisted the temptation. She’s better off.

Wages and cheap labor


A few years ago I had a long running contract as a programmer at a large company. If you are a contractor two rates are important, the “bill rate” that the corporation pays your contract agency and the “contract rate” that the agency pays you. Contract agencies hate to tell you the “bill rate” because then you know how big a cut they are taking and how little you are getting.

But sometimes you can find out. And I found out that the corporation had a standard bill rate of $68 an hour that they paid to the contract agencies for most of the programmers they got.

Until they started hiring guestworkers in a big way. Most large companies and contract agencies know how to game the system so they can pay guestworkers much less (about 30% less) than they would pay an American. So they get as many as they can. But once they do, then all contractor rates go down. And sure enough, when the company started hiring guestworkers, it lowered if bill rate for all contractors from $68 an hour to $65 and hour, and then lowered it to $50 an hour.

Well, some of us got a wage cut of 100% when they replaced just about all American contractors with guestworkers. And when we tried to get another contract, all the agencies started offering us 50% less than we hade been working for (because they found that they could send the work offshore where the workers were paid only one tenth as much as here).

Cheap labor doesn’t just hit the individual who loses their own job. It hits everyone from that moment onward as the wages for all jobs go down to match what the companies can get away with paying anywhere in the world.

Your job’s next.

“You Americans are too honest”


I was chatting with “Slim” a few desks down from me yesterday. A few months ago there were 90 of us contract programmers and analysts here in one room, and now there are only ten, and we will all soon be gone. The guestworkers from India are all calling around looking for new jobs.

My friend Slim was helping “Rajiv”, the guy who sits in the row in front of us, when Raj got a call from a recruiter, and Raj was claiming all sorts of skillsets that Slim knew he couldn’t do. So Slim asked Raj, “Why are you telling them that?” And Raj said, “You Americans are too honest. We lie to get the job, and when we get there, we help each other out. And if none of us there know how to do it, then we just move on to the next job.”

When I got to this gig, 90 of us came here in the course of a few weeks, and only two of us were Americans. Now, of the few who are left, most are Americans, because we didn’t lie about what we could do. But the “Powers That Be” had to try to hire at least two guestworkers who couldn’t do the job before they would break down and hire an American who could.

And that’s how the game works.