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Outsourcing continued

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by timtait2x

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Lets get real here people, the reason that companies outsource, is because people want too much money for the work offered, then don't want to pay the prices as consumers that are required to compensate for the wages and costs- its why workers at ford, gm, etc., are driving imports to work instead of their own company owned cars, and IT workers are using Nintendo and PS2's instead of X-box.
Companies are about profit and the bottom line, period. They are supposed to be. When people start whining about not making enough money, then don't want to actually WORK for the raises they look for, wanting everything just handed to them, it's not too hard to see why a company will go to a different country to pay someone who is willing to work for their money, which is a lot cheaper than what we get, but more than what others in their area make.
I've started a home IT business, and have a few free lance sub-contract employees for when the load gets too much for a single person.
Whats funny is listening to these people harp about looking for that "golden opportunity" job, while I'm paying them $20 an hour when they do work for me,while only charging the client $25 an hour for the job, and they won't go out and get a business started, or put in the hours that go with running a business to become successfull.
Isn't it great to just sit there and whine about not having a job, expecting "them" to take care of the problem and do something about it, instead of trying to find a solution, solve the issue, and do something for yourself? Cause if that's all your going to do, quit wasting our time.

9 replies

by ahickman

Tim,

Hooray for you Tim for starting your own business, charging $25/hour and paying your employee's $20/hour.

Where are you at? I will work for you all day for $20/hour.

However with the payroll taxes, insurance, etc. I wonder how long you will be in business.

Art

by dc_guy

The accepted formula is that your self-employed hourly rate must be double that of a salaried hourly rate in order to be the equivalent income. Self-employed people have to cover their own Social Security, insurance, pension fund, training, vacation, sick leave, home office expenses, and biggest of all: bench time. Everybody has periods of unemployment between engagements.

This works out to a net income of just about half of what it looks like. So a contractor charging $20 an hour has the same net income as an employee earning $10 an hour.

You can only live on that if you're single, ride subsidized public transportation, prepare all your own meals, wear only jeans, and either share rent with two roommates or live in Winnemucca NV.

by timtait2x

so on just a 40 hour work week, you can't survive on 41 grand a year? Try living within your means, because I know many people making it on a lot less.
Sure there's bench time. There is in any business. And while you have to take care of all of those things yourself, you also get to write many things off as business expenses.
If you are in a dual income family, it is definitey more than enough.
And I guess you haven't heard of shopping around, looking for sales and bargains, etc.

by timtait2x

our own boss when these others contract with me.
All of their own taxes and such are there expense.
I do pay extra to workers comp when they work for me.
I'm making the $20 an hour when I'm out working myself. The other $5 form both myself and others working for me go into paying for insurance, overhead, etc.
On the flipside, I get to claim part of my home expenses as business costs, since this is where my office is.
Why work for me? Why not have your own local business going,put up your own flyers, do homenetworking and tech work for individuals as well as businesses, just plain and simple put your self out there.
You don't even have to quit your current job, you can do the work part time, have the contracted other workers to do it when you are at your job.
I guess my whole point in general, though not put forward correctly when I look at my original post, is that instead of waiting for someone to create a solution for you, create one yourself.
There's thousands of people out there that need their home pc fixed or maintained, want to create a network at home, need tutouring to learn how to actually use their machines and the software they are using.
There's also hundreds of smaller businesses needing the same, that don't do it because the costs are prohibitive.
You want to charge more than $25 an hour, do so. Charge what your market will support. I was just giving one example of what can be done.
And really, if your a fully certified CNE, MCSE, CCNE, or net admins, and your worried about phone helpdesk jobs being outsourced, your already selling yourself short.
But I know a fully certified CNE that is working as a helpdesk tech for $12 an hour, after he lost his bank networking job due to a merge, not an outsource, and he's working this job because he wouldn't take the $48 grand a year job at the local school board cause it wasn't enough money. He wanted $60. They start new networkers at $48. Period. It's their starting wage for a fully certified Network Engineer.
Now he makes $25 grand a year. He's in this situation because he got greedy, not because the employment wasn't there.

by jellybeenz

You're painting with a pretty broad brush here. Most of the IT workers that I've met over the years have gone above and beyond the call. Unpaid overtime is the norm. We keep the networks running with spit and baling wire much of the time because management won't approve upgrades. And most of the time we get no recognition of any of that. But that's okay because we love our jobs.

You may be paying $20/hour, but what kind of benefits do you offer? Probably none since it sounds like they are more contract hires than full-time employees. $20 is not much when you factor in health/dental insurance (or lack thereof). Most of the time that "golden opportunity" is not so much about the money, but job security, health benefits for you and your family, and the chance to build a career. Not everyone is an enteprenuer. I also don't think IT professionals expect anyone to "take care" of them. They work hard for their salaries and expect to be able to make a reasonable living. I don't know anyone who got wealthy working in IT. When it comes to salaries, we cannot compete with companies in India and elsewhere who pay their staff a fraction of what we earn here. Could you live on their wages? Maybe if you moved to India.

As far as overseas outsourcing, I don't know what the answer is. But I do know that slamming the IT community for greed is NOT it.

by timtait2x

I guess you were ignoring the broad brushes being used in the original conversation of outsourcing.
It wasn't an intentional slam. But as for the $20 an hour not being enough, read my reply above.
Most of those outsourced overseas jobs are for lowlevel non cert required phone in helpdesk jobs.
If your a certified IT professional, what are you doing looking at those jobs in the first place, as they pay a lot lower paying than what I've been stating.
Your talking jobs that pay $10-13 bucks an hour tops here.
Your right, they are contracted workers.
And I've done everything you stated in your first paragraph, not only in the IT field, but as a chef as well for 15 years.
When comparing the two, I'll take the unpaid overtime as a tech.
But you are correct, not everyone is an entrepeneur, and out of the 10 guys I use on a regular basis, there's actually 3 that I would hire full time if I get busy enough to get employees on a full time basis.
But you missed the point about greed, because there are way too many in this field that are.
Should we make as much as we can? Certainly, and if your in a market area that supports $50 or more an hour, hey do it.
But when you are in an area that doesn't, or when you work for a company that is looking to stay afloat, and instead of doing what will help keep the job, and the company going, you gouge them for as much more as you can, then wave bye to the job as it goes somewhere else.
This isn't only a symptom in the IT field, but most businesses across the board.

by jellybeenz

I wasn't ignoring anything. I guess I didn't see the original conversation you are referring to.

There are greedy people in any industry that will gouge a company for as much as possible. A lot of them in IT were probably attracted to the field prior to the dotcom bust and during the Y2K period. It was a good time to be a programmer. However, in the years since then salaries have flattened or declined and there is a surplus of people like us. It's a buyers market now and IT professionals have adjusted their expectations accordingly. But it doesn't matter. Because even if we worked for $20K a year, companies would STILL outsource because the overseas programmers are STILL cheaper. At what level do we just give up and go flip burgers?

by dc_guy

Keep your vacation down to two weeks, pray for no more than two weeks of illness, and limit yourself to two weeks of training and professional conferences in order to barely keep up with what's going on in your field. There's $4,800 off the top right there.

I've never met a contractor who didn't average three months of bench time a year in the long run. And it's always two days here and a week there, often unexpectedly and usually hoping anxiously for the phone to ring, so you can't make that your vacation. There goes $10,400.

You're down to $26K and 14% of that has to go into your own SEP IRA because nobody else is looking out for you. Plus the cost of that training and those conferences, even if you stay at the Motel 6 instead of the hotel. And your full Social Security dues with no employer to split them -- even though by the time your generation retires that particular Ponzi Scheme will probably have imploded.

Sure you can play tricks with your taxes, most of which are perfectly legal, but you're not in a very high bracket so it's not going to save you much.

As I say, you end up netting just about the same as someone working for ten bucks an hour at Target: slightly more than $20K.

You have to be in a dual-income family to make do on that. Or else live someplace where you can rent an old mobile home for $300 a month. But those places tend to have few business prospects for an IT consultant, and they're a long way from the nearest hub airport.

Yes I know all about bargains. We have two 25-year-old diesel cars, we make our own dog food, and we've bought used shoes on e-Bay.

by thechas

It sounds like you have the safety net of a working spouse.

I suspect that your spouse also provides your health benefits.

If you had to provide your own health benefits, or shoulder the full cost of your family, 41K would not be enough would it?

That's the root problem with the "global" economy. We in the US will no longer be able to have a reasonable life on a single income.
Those who don't have the skills, connections, or drive to grad at the few opportunities will be reduced to street beggars.

I don't want to see that reality come to be.

Chas

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