Outsourcing

Offshoring to end, as businesses run out of jobs to outsource

Analysts predict that by 2022 major US and European businesses will have run out of IT roles to send offshore.

The number of European and US IT jobs sent offshore will decline from 2014, as businesses begin to run out of roles that can be carried out abroad.

Within the next 10 years the flow of IT jobs offshore is likely to cease, as there will be few roles left suitable for moving to low-cost countries like India and China, research by The Hackett Group found.

By 2016 almost 1.1 million IT jobs will have been sent offshore, according to the research, which examined data on 4,700 companies with annual revenue over $1bn headquartered in the US and Europe.

"In the US and Europe, offshoring of business services and the rapid transformation of shared services into global business services, have had a significant negative impact on the jobs outlook for nearly a decade," said The Hackett Group chief research officer Michel Janssen.

"That trend is going to continue to hit us hard in the short-term. But after the offshoring spike driven by the great recession in 2009, the well is clearly beginning to dry up.

"A decade from now the landscape will have fundamentally changed, and the flow of business services jobs to India and other low-cost countries will have ceased."

However, the report predicts that IT jobs that have been offshored won't return to their country of origin, saying "this trend is irreversible".

The large-scale movement of IT service jobs and supply chains from western countries to offshore locations could see offshore destinations become global hubs for activities like application development.

"As product/service lines, go-to-market strategies and supply chains become more global, the portfolio of business services required to support these global operations must become more global as well. The result is that it is no longer natural or even appropriate for the center of business services delivery to remain in the traditional domestic market," the report said.

Despite the continued flow of IT roles offshore the report predicts new domestic demand for IT specialists in western nations as IT spreads to a larger number of products.

"These cutbacks aside, as companies embed technology into an expanding range of products, new IT jobs in their product development organizations are being created. Finally, the IT industry (hardware, software and telecommunication) itself continues to grow, creating additional demand for IT workers," the report said.

"As a result, the picture of the IT job market is not nearly as bleak as suggested by the 15-year trend."

About

Nick Heath is chief reporter for TechRepublic UK. He writes about the technology that IT-decision makers need to know about, and the latest happenings in the European tech scene.

150 comments
cheth
cheth

I agree with the trend discussed in this article. Nature has a way of equalizing things, however people can't adapt as fast to the changes in the world economy. In the end the IT jobs will be almost equally distributed around the world. It's a shame it has ruined many a career in the United States in the name of profit. In addition it has discouraged college students from getting into an IT career in the U.S. This leads to the continued brain drain in the United States. If only the U.S. government could see past the end of the corporate nose the government could have protected some of our U.S. talent from disappearing.

Systems Guy
Systems Guy

Irreversible? I don't think so. Technically, there is no reason the jobs can't be brought back. Financially, they probably can't or won't be brought back. It always boils down to money.

ittechexec
ittechexec

As a Technical Resume Writer and Job Search Coach, I've been watching this trend over the past 10-15 years. The discussion that most people avoid is the one concerning talent. Our academic institutions today are not equipping students properly for the market. Unless a student goes to a hardcore technical institute or has the motivation to learn it on their own, most do not have a grasp on the foundational elements of computing, networking, telecommunications, programming, etc. As a result, they are of little or no value to an employer. Of course, those that do learn this can be highly sought after, which is why so many US companies are willing to sponsor work visas for foreign candidates (particularly India, China, and Eastern Europe). I expect the trend of offshore outsourcing to balance out, although I'm not willing to say that any industry will "have no more jobs to outsource" by a certain date. As one comment mentioned, governments are unable to stay out of things, so eventually the government in India will raise taxes on non-domestic or outsourced operations (they already have in many industry segments), which will eliminate the cost savings for US and European firms. http://www.ittechexec.com

Mike.Sandy
Mike.Sandy

What I've read and heard for years is that business is off-shoring to avoid high Federal taxation. Recently learned the US rate is higher than China. Its not about wages as commonly reported on the nightly news. The effective rate is 39%, and one of the highest in the world. The current tax reduction plan would add 250 billion to gov't coffers. Sounds like a reduction to me. [/sarcasm] While most all other nations have lowered their rates the US has held steady to where we're about 10 percentage points higher than the rest.

maharawj
maharawj

The growth will decrease that's all. All the companies that have offshored their processes will be doing so.

jkameleon
jkameleon

. . . universities and industry still shout labour shortage. First, the manufacturing was offshored, then knowledge, and now, there is nothing left to offshore. That's the real reason why the offshoring will stop, and that's also the reason why the offshoring jobs won't come back: They have nothing to come back to. Where "metal banging" jobs go, everything else goes, and then follows the decline. This pattern repeats itself throughout history, and it never changes. British textile industry in the 19th century, US automobile and electronics industry in the 20th century, and now IT. > The large-scale movement of IT service jobs and supply chains from western countries to offshore locations could see offshore destinations become global hubs for activities like application development. > Finally, the IT industry (hardware, software and telecommunication) itself continues to grow, creating additional demand for IT workers,??? the report said. Growth will hapen in beforementioned "global hubs for activities", not in the western countries. Demand for IT workers in the west can only get lower.

gevander
gevander

Is the reason that the outsourcing will stop. It is more sad that so many of the jobs won't come back. Too many executives outsourced jobs they *should not* have - like their Level 1 help/service desks. Too many executives looked at ONLY the initial cost of a call to determine whether to outsource. None of them looked at the back-end cost of the call: An insourced L1 is expected to resolve 60+% of all calls. An outsourced L1 is expected to solve 40%. That means 20% more callers (who "cost more" than the insourced L1 call taker) who are slowed or stopped in their work for longer. If the insourced L1 can't solve the call, it goes directly to L2 (or to a more knowledgeable L1.5) and gets resolved relatively quickly - typically less than a day. The outsourced L1 connections to the (outsourced) L1.5 and (insourced) L2 typically result in downtimes of 2.5-4 days. So what is the OVERALL cost, executives? ( saw a recent tech article that mentioned the same thing - executives only look at the initial expense when making this calculation and not the end-to-end expense.) This is an example from personal experience (this type of outsource affected me), but my wife has similar stories from the ACCOUNTING world - executives hiring 5 overseas workers to get rid of one on-site worker... and then the remaining on-site workers have to redo everything the off-shore attempted and do for them those things that are "outside the box" and require creative thinking. The overall cost is actually cost prohibitive... but NOT outsourcing doesn't get the executives a fat bonus.

rwilkin481
rwilkin481

I'll b just about early retirement age.

fullerwp
fullerwp

If this is the best news on the horizon, I suggest future computer science grads consider apprenticeships as plumbers. Yes, it's still crap, but politicians and greed mongers will continue to provide an inexhaustible domestic supply - no outsourcing!

dconnolly
dconnolly

I used to be a CIO, then a consultant (who sold and did outsourcing deals). My take is that today I am a Director of IT, and working hard to develop our staff, their skills, capabilities, attitude, and as they earn it, their compensation. I really have little interest in outsourcing today. Instead my focus is on developing a continually developing skill set of capable people to help drive support for the business. Today the hard part is finding people who will roll up their sleeves and make the effort. Outsourcing has sapped the American spirit. If America is ever going to be great again, we will have to do it ourselves, and outsourcing does not get it done. Investing in ourselves and then being accountable for delivering results at a reasonable cost that helps the business grow is a path back to greatness. I sometimes think I may the only one out here with this attitude. The CFO and President have our back, because we have earned it. It can work, it is not easy, but it is the only way to go for me.

jkameleon
jkameleon

> In addition it has discouraged college students from getting into an IT career in the U.S. It's a natural way of equalizing things. Students are behaving reasonably. Too bad for university profits. > If only the U.S. government could see past the end of the corporate nose the government could have protected some of our U.S. talent from disappearing. Corporations are multinational. They don't care about the U.S, and they don't need to, and are not even supposed to. Yet, U.S. government seems to care quite a bit about corporations. Why?

Tony Hopkinson
Tony Hopkinson

The thing all the outsourcers and even worse offshorers ignored, is how much inhouse / cultural investment they were throwing away. We are all much more than our transferrable skills. Imagine how much it would cost to set up an entire IT department, how nervous a business would be, how little of that cost, could be proven by ROI and such like to investors / owners, how much of anathema having to do it would be to those who believe in standard corporate practice? After you jump that hurdle, who's going to recreate your department? The clueless morons who understood so little about it, they got rid of it in the first place?

jkameleon
jkameleon

IT does not exist in isolation, it needs a sort of "ecosystem" to survive. Offshoring is like erosion of a hillside slope. If the conscious effort is made, it can be prevented in its early stages, but in IT (and hight tech in general), that opportunity has been missed a couple of decades ago. Manufacturing is a sort of substrate, a topsoil upon which everything else grows. Once it has been washed downhill, there's no way to stop the erosion. It can only accelerate. More here: http://www.forbes.com/sites/stevedenning/2011/08/17/why-amazon-cant-make-a-kindle-in-the-usa/

jkameleon
jkameleon

You can not expect academic institutions to train people according to any employer's current specific needs.They can only give them understanding of the basics, which enables them to learn further. The specific details must be learned on the job. There is no other way. Employer, who is not willing to build long term relationship with employees, who considers employees like expandable, interchangeable parts, like assembly line workers of old, will not want to invest anything into them. Consequently, he will not have talent of his own. He will either hire talent dowsized by competitors, poach it from the competitors, or make do without it, constantly griping about talent shortage. Employers and countries, where talent shortage shouting is the loudest, should therefore be avoided like plague. Great Britain is by far the worst in this regard, with Canada, Australia, New Zaeland, and South Africa not far behind it.

mckinnej
mckinnej

While I wouldn't go as far as to say it's "all" about talent, it definitely plays a role. I'm in the middle of standing up a new enterprise program. Finding qualified personnel is a challenge. I seriously doubt that fed into the decisions to outsource though. The execs only cared about the talent/skills where they were going, not what they were leaving. If the talent/skills are there and are cheaper, it's a no-brainer decision. Sux to be on the losing end, but pardon the cliche, that's business. The only thing that can reverse something like this is customer feedback. Voting with your wallet is something companies pay attention to.

adornoe
adornoe

is keeping its cash stored overseas. If the tax rate were to be lowered, chances are that, more of the earnings of US companies would return to the country to feed more economic activity and more jobs would be created. Apple has approximately 80 billion dollars stashed in foreign banks that they wish they could "bring home", but, the tax rates make it a forbidden move. People are not taking notice about how many other countries are "stealing" our companies and jobs. Look at what Canada did a couple of months ago, when they lowered their corporate tax rates to 15%. Who in their right mind would not move operations to Canada if they could? And people are still wondering about offshoring and outsourcing? All they need to do is to look at what makes companies send operations and jobs overseas. But, no, they'll always attribute our jobs losses to "greedy, evil, rich, corporate executives".

JCitizen
JCitizen

The companies who don't have dunderheads at the top, like that; will bury the competition! Your logic is just another nail in the reason outsourcing will have to stop. The bottom line will chew them up, and the stock holders will be revolting and throw the chairpersons out, not just the CIO/CEO! Wait'll they get a load of the stock holder revolt movement - they will make the Occupy Wall Street movement look pale! After all - even the "little" people own stock now days.

JCitizen
JCitizen

that could occupy technically minded people. We just need to think. Getting the government off our backs would help! Innovation will drive this - who knew a kid could start Facebook and become a billionaire! I stil see skilled jobs that go unanswered because there are not enough skilled workers to fill them; or in some instances they are just not willing to move to where the good jobs are. My brother was offered a job at Woods Hole with a $50,000 dollar signup bonus, and he refused it, because he likes it where he is. Money isn't always the biggest driver either. He only has a technical degree, but now days, that is needed more that ever!!

adornoe
adornoe

the executive management that they stop offshoring/outsourcing, and see where it takes you. But, before you go to them, make sure you have a plan that can make the company profitable, or that can keep it profitable. Running a business is a different responsibility, and the goals are a lot different from the responsibilities of middle management, who often have a more limited role in getting the company to operate efficiently and cost-effectively. You might be correct in many of your points, but, from your perspective or area of responsibility, you cannot run the bigger responsibility of keeping the company economically viable. You can contribute towards the health of the company, but, you might not be seeing the whole picture that upper management is charged with.

bburgess66
bburgess66

the only sensible comment so far .. no attitude .. just to the point

JCitizen
JCitizen

I've always said the American worker was easily capable of providing value to the company, as long as they don't let anything get in that way, that is still true. Innovation has been a big driver on the factory floor. We redesigned the work space and make it more and more efficient; this lends the company to stick to our home, where we can easily compete against the world. We need to work smarter, not necessarily harder. Also - when you like your job, you don't notice it is hard work at all!

adornoe
adornoe

structure in a company, specifically, the IT department(s), but... Those are all things that, come secondary to survival of a company, and sometimes, offshoring/outsourcing, are the only or best options left to companies. Don't you think that, managers and executives and shareholders/company owners already know about those issues you mentioned? If they didn't, then they had no business being in supervisory/management positions to begin with. When people are quick to castigate, verbally or economically, a company and its executives, they're not thinking about the decision-making process that does go on in the boardrooms, and tough decisions have to be made every day. But, I understand that, people will be angry about losing jobs, and they need to let off steam, whether warranted or not. But, worse than losing jobs, would be losing more of the economic sector, namely, the companies themselves, who are the source of the products and services we consume, and the actual creators of those jobs, even if many of them are lost to foreign competition or to offshoring/outsourcing.

JCitizen
JCitizen

in Germany they still have the apprentice system. It is still successful to this day. It is just basically OJT, to coin an old military acronym.

adornoe
adornoe

on their investments. Besides, a lot of the small investors are doing so through company retirement plans, and they don't really know what their money is being used for. Now, when it comes to "OWS", that's the most phony movement ever invented, because, it was led by politicians, and not really "the people".

ultimitloozer
ultimitloozer

is generally just how much they will be walking away with year after year and making sure that nothing stops that number from increasing each year. An economically viable company does not matter much since they will find their way into another company after they drive their current one into the ground.

Tony Hopkinson
Tony Hopkinson

Worse still the biggest they can get now, no matter what the long term consequence. There might be few of us who can plan past next Monday, but we kept getting outvoted, can't beat 'em so we end up joining them. Rich vote for less tax on them, Poor vote for less tax. Middle income earners who are the true power house in any viable ecomomy get shafted which ever one wins... You blame the poor, I blame the rich, we are both right if you sqint. You keep saying we should change the weighting in the system to favour what you want, I think we should execute the lot of 'em and start again.

adornoe
adornoe

where, the art of doing business is full of dirty tactics and tricks, and it's never going to change, because, the people are ignorant and they'll vote for the ones who promise them the biggest slice of the pie. Greed is everywhere, and it can be found at the highest level and the lowest as well. It's the lowest level that have the power, but that lower level can't be bothered with paying attention to how the world works or how they're being had.

NickNielsen
NickNielsen

It is in the large contributors' interest to distract the voter from what is going on, lest the voters agree on something that reduces the money available to the large contributors. Thus, we get Fox News, MSNBC, talk radio, and us/them rhetoric from those who would benefit most from the distraction. Unfortunately, too many Americans are easily distracted.

adornoe
adornoe

is being "bought", the voters are always the ultimate "deciders" in elections. The problem is that, far too many people are uneducated on the issues and the candidates and government. Far too many buy into the "I care" mantra spewed by their favorite politicians, and thus, that public is not going to be doing enough thinking before voting. It's about who will "give" them what they want or need, and the future consequences be damned.

adornoe
adornoe

or the appearance of doing something. Most legislators won't worry about outdated or unneeded regulations or legislation. They only care about the perception of doing something about the "current and urgent" problems, and their always upcoming re-election.

NickNielsen
NickNielsen

The logical assumption from that is the lying and corruption are favored by the same big money interests that choose and fund the candidates. It is, after all, in their interest to [u]not[/u] have the general voting population agreeing [i]en mass[/i] with an idea or policy that might make their money less big...

Tony Hopkinson
Tony Hopkinson

Because that's exactly not what they are getting, when was the last time broken / ineffective legislation was taken off the books instead of being added to, by any of them? Pretty sure the last time was around being a witch or warlock, and that was a serious fight...

adornoe
adornoe

but, the executives in those corporations also understand that, government is not going to just slither away and so, they have to be dealt with, and in many cases, compromises have to be made. But, like I said, it would be much more preferred if the government would just stay away from trying to intrude into the free-market system. Reality is that, government has become too big and too intrusive, and the people and corporations have been handed a very uncomfortable position as regards dealing with government. However, even if executives in government or in politics or the corporate boardrooms pick our candidates, the people, aka: the citizens, still have to do the ultimate selection via the polls. And, that's where the system has gone awry too, with so much lying and corruption that, the people are bewildered into making bad and uninformed decisions. But, the common thread into any form of government that no longer works as the people intended or want, is that, when government gets too big, the people lose, and we are witnessing that all over the globe. The people make the decisions, but, they are being deceived by too many people in high places.

Tony Hopkinson
Tony Hopkinson

who gets power in our countries. Mine and your vote, or the big boys choosing the candidates we can sensibly vote for.... We may differ somewhat in our political beliefs :p, but I bet you and I have more in common, than either of us do with almost any of the self serving gits the big boys sponsored into our legislatures. Never seen a corporate ask for less government. Less regulation, or at least friendlier, if they wanted that, they'd already have it. W|e get bigger and bigger goverment ( no matter the strip of the politiocal party in power), because that's a price the corporates are prepared for US to pay, in return for "friends" in high places.

adornoe
adornoe

and many of them would actually love less government involvement in the economy. What too many people fail to realize or understand, is that, government is the cause of many of the problems, which have caused many corporations to move their shops and jobs overseas. So, the "campaign contributions" aren't helping a bit when those same companies are having to outsource and offshore their operations and jobs.

Tony Hopkinson
Tony Hopkinson

If for programming, you mean the theories behind good coding practices as opposed to those behind an efficient sort algorithm, then I wholeheartedly agree. The concentration on tools as opposed to when and how to use them is one of the main planks in our commoditisation. I wouldn't mind but it's outright dumb,good prgrammer should be the commodity, not learnt language X.

adornoe
adornoe

which means that, a person can start out at the bottom of the corporate ladder or at the bottom of a career, and move up as one learns the skills necessary. So, after high-school, a person might already have an idea about which career path to pursue, and then, all that's needed is for the corporate world to step up and take on those "trainees", with a clear career path designated, even if many don't wish to progress from the lower ranks. Then, once a person attains a certain skill-level with good and actual experience, he/she can apply to get a certificate or degree which acknowledges that person's experience and training. As it stands now, we train too many college people who, after their college days, will go and become "trainees" in the "real world". Many of those college trained people are not really better than a person that might have worked his way up the ranks and up the skill-set ladder.

JCitizen
JCitizen

I agree with both of you and your points, it is just that the technical field is changing so rapidly, that knowledge and experience can go out the window. So by the time kids get out of college, their knowledge is already obsolete. I experienced this myself after graduating my computer courses, in CCNA ,MCSE, and the usual; just to find out I was already several orders and steps behind the software and hardware. I had to rapidly catch-up. I was spending all my idle time researching the changes online and educating myself to the new reality. I might as well not gone to school at all. I wonder if we need a paradigm shift, where we teach more theory and principal, and dispense with nuts and bolts learning, This way the student doesn't waste time learning obsolete skills. Because if this, we may be able to recover a labor force more rapidly than the 'naysayers' say.

Tony Hopkinson
Tony Hopkinson

Worse still now you've given all that talent away, and effectively devalued it, growing it back is going to take serious time and money. Do they know about the issues? I'm far from sure that they do. Certainly I've seen absolutely no evidence that they do. Best way to get buy in for an unpopular decision, is to make the why of it very clear. I've seen that twice in a thirty + year career...

adornoe
adornoe

and, you're right about home-schooling and about those parents having to pay for the schooling of other kids, while the home-schooled kid isn't getting the same resources as the public school kid. But, it's a way of the liberal school system trying to force parents into using the public schools.

JCitizen
JCitizen

to an certain extent. In conservative school districts, they have tried to deal with the Federal Dept. of Education mandates, but it has been an uphill battle. Some folks gave up and went to the ancient home schooled method; this not being quite the failure liberals advocate. In my area, home schooled students are required to take the same tests that are required by "leave no child behind" mandates, and they score WAY ahead of district school system students!! The sad thing is, the parents who sacrifice to stay at home and teach, are still paying taxes to educate other people's students poorly. Some have developed private home schooling similar to the old country school method where several families pool resources to educate a small group of children - these are the most successful. The "school marm" is just as likely to be a former retired industrial worker, who knows REAL world stuff!! The education these kids receive is priceless!!

adornoe
adornoe

are with education. The problem with the education system is that, it's controlled by liberals, from K to 12 and even through the college years. The education system has been destroyed by the liberals who wanted to use it to indoctrinate students on the liberal agenda. Real education came second, and the teacher's unions are wholly owned subsidiaries of the democratic party. When trying to identify a problem, do try to get at the real problem and not what seems appropriate for your agenda, or the agenda of the democrats.

JCitizen
JCitizen

The banks have been blocking education efforts in the post secondary schools every since 1911. It is high time we give our children the tools to know what is going on, and how to take control of their own destiny! Thanks for the post! Very interesting!

adornoe
adornoe

I may not always be available to help you with your questions. But, I'll do what I can, and if you keep it up, I may have to start charging you. ;) "Another question" You're full of them, and obviously, whatever your liberal educators were "teaching" you, has left you with a lot of questions unanswered. "The investors are the owners, and if the owners are not happy, then the company won't be around for long." Try to learn that lesson, and perhaps you won't have to ask a question relating to it again. ;) "Does this apply even if the company is profitable?" That comment of mine above applies to any company, profitable or unprofitable. The unprofitable company, if they wish to disregard that lesson, will soon be out of business. Simple common sense. "After all, if the investors aren't happy, even with a profitable investment, they can sell their investment." Well, dude, if they are into playing the stock market, and they aren't happy with making profits, then they have special problems, or they have other things that matter more to them. But then, why the heck did they get into investing to begin with? Methinks that your question is more hypothetical than real. Not saying that it couldn't happen, but then, it would be nonsensical to invest and then pull out when the company is being profitable. "That's why we have stock markets or private equity sales." Yeah, people do sell their properties, and stocks, and assets, but, if they're in a market to earn themselves some profits, they're playing a different and unusual and odd game with their money. IOW, your question doesn't have much common sense behind it, or the people doing the investing and selling, as you suggest, don't have much common sense behind them. "And which obligation should be more important to management: short-term profit or the long-term viability of the company? Should management maximize profit today at the possible expense of the company's survival or sacrifice some profit now to ensure the company will continue to operate profitably for the foreseeable future?' In today's "instant gratification" world, many people in management are tasked with producing short-term profits, and they're not to be concerned with the future, which is very foolish. Long term profits are for those who are looking into the distant future, and a more secure one. The best management is the one that produces in the short term and sets up the company for a long term prosperous future. If both can be had, I'd prefer to be investing in such a company, whereas, if the short-term is what matters, then that's not a company which people should even be looking at. A company with short-term goals, is not a company worrying about the future. A company which sacrifices short-term earnings for a more secure future, is one which will, normally, have a much more secure future, and is expected to have better returns on investments than the instant gratification business. "I've already figured it out by myself. I'm trying to understand your assertion that profits are more important than employees; after all, without employees, there is no product and thus, no profit. Seems to me that management's responsibility is to balance the need for short-term profit with the continued survival of the company and the need for a stable workforce." Judging from your prior history of postings, no, you haven't figured it out yet. Management does have to keep a workforce happy, otherwise, the company wont have the people it needs to produce profits or to continue growing. However, if the investors are not made happy with good earningS, be they short-term or long-term or both, then the management won't have to worry about the workforce or staff, because, a company without happy investors or happy owners, is a company which will cease existing. Short term profit can be sacrificed if the company is on secure ground with healthy growth and a strong long term strategy. Short term profits are only good for those who worry about the present, and no employee, management or regular staff, can feel secure in that kind of environment. A company with a long term strategy for growth, is one where the employees, at all levels, can count on a more secure future. But, in all cases, if the profits aren't forthcoming, there will not be happy investors/owners, and there won't even be a staff to manage, because, the company will be forced to cease operations for lack of profits or lack of long term growth. It's simple common sense, and simple economics. Anything else you need to be educated on? ;)

NickNielsen
NickNielsen

[i]The investors are the owners, and if the owners are not happy, then the company won't be around for long. [/i] Does this apply even if the company is profitable? After all, if the investors aren't happy, even with a profitable investment, they can sell their investment. That's why we have stock markets or private equity sales. And which obligation should be more important to management: short-term profit or the long-term viability of the company? Should management maximize profit today at the possible expense of the company's survival or sacrifice some profit now to ensure the company will continue to operate profitably for the foreseeable future? I've already figured it out by myself. I'm trying to understand your assertion that profits are more important than employees; after all, without employees, there is no product and thus, no profit. Seems to me that management's responsibility is to [u]balance[/u] the need for short-term profit with the continued survival of the company and the need for a stable workforce.

adornoe
adornoe

but, the company had better be producing enough to make a living for its employees and the ownership, otherwise, it would be suicidal to continue operating. When it comes to investor-owned corporations, the management had better be producing for those investors, or, it will not be operating for long. Now, if a company is being successful and producing for the investors, it had better be trying to take care of the employees that have made or kept the company producing for those investors. Notice that, the bottom line is about the investors, and the management is working for, (guess who?), well, the investors. The investors are the owners, and if the owners are not happy, then the company won't be around for long. Unfortunately for the management and for the labor in that company, the real bosses are the owners/investors. So, why can't you figure that out by yourself???

NickNielsen
NickNielsen

Is it the same at privately- or employee-owned companies as it is in publicly-traded companies? If not, why not? Should management balance the desire for profits with the need for a stable corporate work force? Can a company survive if it [u]doesn't[/u] take care of its employees?

adornoe
adornoe

when it comes to what upper management's responsibility is to the owners of the company. No company will ever survive if their prime concern is to provide jobs and benefits to their employees. If a company doesn't produce results to make the owners/investors of a company happy, then you can kiss all the labor and the whole company good-bye. Simple thinking is not what solves complicated problems.