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Outsourcing Still Affects Us: This and AI Worker Displacement Need Not be Inevitable

My uncle, who’s now in his early sixties, has been working at Verizon New England for decades. He was there when it was New England Telephone and for Bell Atlantic’s purchase in 2000, when the name changed to Verizon.

Throughout the years, he’s seen his peers laid off in the dozens. In his department, he is now literally the last employee working in the United States. The rest are employed in India, saving the company billions, where they receive incomparably lower salaries.

Healthy and able-bodied, he is in no mood to retire. However, as there was every indication that his position would soon be transferred to India, when he was offered an early retirement package, he reluctantly took it. His last day is in mid-spring.

Cheerleaders of the globalized economy claim that outsourcing does not happen too much anymore; rather, it is artificial intelligence that is the main threat to labor – and this tends be couched in the inevitable forward march of ‘progress’.

Yet, this past fall, a dozen people were also laid off where I work, as their jobs shifted to India. These were just a few of the 14 million American jobs overseas in recent years. As my now-former coworkers were all remote employees in California, it was easier for our supervisor to let them go from our Massachusetts headquarters; they didn’t have to see the sordid expressions of those laid off.

Both department vice president and manager were on the call when the job cuts were explained to us who remained. The latter told us that this was the trend in our department (very encouraging, I must say) of transitioning more work to vendors – in other words, outsourcing to emerging economies where labor is far cheaper. He went onto say that laid off employees would receive some short-term benefits and career counseling. In actuality, this meant that those laid off would be financially secure for about three months and be offered generic advice for finding a new job. Then, bye-bye forever.

In these situations, it is easy to blame one’s boss and – for some – people in India or other developing countries where offshored jobs land. In the case of the boss, he or she is just doing what the company CEO, top tier executives, board of directors and majority shareholders want – greater profits for the company at the expense of workers. But even they are just acting as other companies do, as they compete in the global marketplace.

For those who blame workers in developing countries, this convenient rebuke, bordering on racism, is all too easy. They miss the real culprit of government policy and decisions made by top-tier executives – both crafted within the United States. Just like Americans, people in developing countries take the best employment opportunity they can. Often, thanks to Western offshoring, it is under multinationals that offer slightly more attractive salaries than locally-based companies, while paying far less than in developed countries.

Rather than racialized hatred, both developed and developing economy workers are at the behest of MNCs’ leisurely skating around the frictionless ice-rink-world in search of the most inexpensive labor that ensures exorbitant profit. Already, the jobs that American workers lost to the Chinese may have left China for cheaper labor in Vietnam, Bangladesh and Cambodia. In a state of mutual precarity, international worker solidarity makes far more sense than racialized disdain for the overseas worker.

The mass media tends to frame job loss to outsourcing and AI as an inevitability. Yet, these are the result of government policy decisions that could easily be reversed if there was a will to ameliorate the condition of the worker, and, consequently, help convalesce related problems, such as lower lifespans, higher rates of opioid abuse and suicide.

A quick and easy solution would be to develop a tax penalty to deter outsourcing and a mandate that AI-related job loss require employers offer an equally-paying job. Such would go a long way to protecting the American worker.

It would not dispose of capitalism nor yield a red tide. It would simply help insulate the democratic citizen from rampant job displacement. And why would the democratic citizen expect any less protection from a government that they elected and supposedly works for them?

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