Similar trend at my company - we're looking to hire in India to reduce costs. The rumor is that we could replace 25% of our existing IT workforce without outsourced roles.
If anyone is worried about their job, it won't be AI that takes it - it will be outsourcing. The US offshores 300k jobs per year with a high percentage of them being IT (60-80% depending on source). It's really not that different to the offshoring of manufacturing decades ago. Why pay people onshore when you can pay someone in India half of that? Any job that doesn't require a physical presence or has legal pressures to keep it onshore will be at risk. It will likely get worse over time, just like manufacturing. I don't know what the future will look like if we continue outsourcing everything. It used to be that we outsource primary and secondary sector activies so that we could expand tertiary industries. What are we replacing the outsourced jobs with now?
Offshoring/outsourcing is nice on paper, but as management doesn’t have to deal with time zones, in reality it is much more chaos than expected. And how do they want to deal with fuckups? Thru Slack or Discord? :)
We had British SaaS supplier and all the time I have talked with Bangalore-based people. They had to work in night I suppose…
Hard truths about outsourcing: you’re always dealing with a cultural, political, and legal gap.
Stuff that’s hella-illegal, that not even the remotest WFH citizen would ever try to pull, might look very tasty from another perspective. Economics that favour that cheap labour also means even marginal scams can seem wildly tempting on the other side.
Sad thing is that it works, and more than it works, it gives you an advantage over the people who actually do the right thing.
If you can work it out as you go and get away with it by definition you become the "first mover" over someone who only sells once they have the full capability. The incentive is there to do the wrong thing to win in the market as a whole.
I don’t see that as Indian culture as much as outsourcing. I’ve had tons of that from entirely domestic contractors, including people who’d bid on a project only to admit their team didn’t have the domain experience promised. I’m talking about things as basic as telling the client that they needed to buy an enormous SQL Server cluster because their “developers” didn’t know how to limit joins and were had deeply-nested loops processing duplicate results.
They do this because it often works: business people often lack the experience to tell whether excuses are correct, and large organizations have enough project churn that it’s entirely possible to wing it for the duration of a contract / pivot, get paid, and move on before someone knowledgeable notices that the old deliverables didn’t really work.
What they had in common was greed, and I think that’s where the association with India comes from, too, but as a selection bias affecting people who don’t otherwise have exposure to Indian workers: there’s a floor on what a productive developer is going to get paid – someone smart enough to do the job is also smart enough to realize when they’re being underpaid and all of the abuses I’ve seen were cases where some combination of the outsourcing outfit and senior management were basically saying “why cut our cost by just 30% when we can find someone who’ll show up to work for ¼ of our staff rate?” and then acting surprised when they can’t retain decent people (e.g. I once talked to a guy who had two clues to rub together as he was leaving and learned he was getting ⅓ of the hourly rate and bailed as quickly as possible to get closer to market rate). Less ethical American companies do that, too, but they still lose to the even cheaper body shops so they aren’t as successful, but in all cases I would say it’s not the entire nation’s culture but the subset of fake-it-til-you-make-it business types. Plenty of people in both countries detest that and don’t deserve to be lumped in with them.
Have you ever lived in India? (not just visited, but actually lived there)
I have, and while of course not 100% of any society is ever any specific way, Indian society is this way.
In the same way as german society is very ‘rules oriented’ (to put it mildly), even when individual germans can (and sometimes are!) the opposite.
Don’t mess with the Polizei and expect to come out unscathed, and don’t expect to get what you paid for (or what you’re asked to pay being a fair price) without fighting for it in India. Or for people to follow the rules if they can profit from not following the rules, even if it’s short term.
It’s just the way things work.
Occasionally, there are exceptions, but they typically prove the rule. (Ikea in India is awesome, for instance. And some individual local vendors are too. Autorickshaw drivers, cabbies, landlords, and vendors in busy markets tend to be the worst. Like 5x a fair price sometimes, or a fair price and 1/5 of what you should get. And in some situations, the Polizei are very kind. Like if you’re lost and a pleasant drunk. But do not argue with the Polizei, it will go very badly.).
Like in any society, these have reasons which are extremely obvious to most people in the society, and may not be obvious until you live there.
In India, for example, when everyone is trying to penny pinch/get rich quick because of a history of extractive behavior from authorities and economic/social instability to an extreme degree (including historically, famines, religious wars, purges, etc.) and so many factions/groups that ‘us vs them’ is just the norm - and once enough people start doing it, you’ll be screwed if you don’t do it yourself. It’s the prisoners dilemma writ large, but when there are already a ton of people floating around doing the ‘wrong’ thing. The rich can get away with not doing this (as much) sometimes, when they are dealing with foreigners, but it’s pervasive.
Or in Germany, when there is a history/culture of strong willed people doing what they want and making life harder for everyone else (in an environment where that can get people killed) but a reasonably consistent and obvious majority ‘us’ group, for instance. In weather that WILL kill the unprepared/weak without assistance a large portion of the year, and requires significant energy to be spent just to not freeze to death for everyone.
I’ve had two experiences with off-shoring. The first time my former CTO brought in a near shore firm and they worked independently on a large project. There was no knowledge transfer or collaboration with the on shore devs. They built what was asked, it was over engineered and much was built of little value. We still have the software they wrote but it is a liability. The second time, I’m now in the CTO position, instead of having the nearshore people silo’d we work integrated. Everyone is on the same team, code reviews, pull requests, all mutually understood. It’s so much better. It all starts from the top and if you don’t have vision you’re doomed to fail.
I do wonder at times if tariffs and offshoring protection are necessary at a certain point. Forcing a labor constraint on an economy (within reason) can spur efficiency. Accepting high structural unemployment in the name of the free market seems irrational.
I think we've taken free market to an extreme in a race to the bottom. Tariffs are probably a good thing, but maybe not in the way they have been currently implemented. Almost 15% of the country is on SNAP and we're spending hundreds of billions per month on debt interest. I'm not sure how we come back from this.
Frankly the race to the bottom does result in net good for humanity as a whole - but the transition period is not kind to the people who are losing their jobs.
Usually 5 - 10 years later the industry will cry because of lacking competence and being left behind by new companies from nations that can produce cheaper and themselves.
It turns out there is little value in management alone. It will be cut loose like the rest. Perhaps these companies can become patent trolls.
Also they have a very hard time to find new talent since word gets around. Sometimes it works for industries like textile, but not always, and it doesn't work for engineering.
It mostly works for low budget or high volume products. It is still a bad long term strategy. Still, outsourcing didn't just start yesterday.
If anyone is worried about their job, it won't be AI that takes it - it will be outsourcing. The US offshores 300k jobs per year with a high percentage of them being IT (60-80% depending on source). It's really not that different to the offshoring of manufacturing decades ago. Why pay people onshore when you can pay someone in India half of that? Any job that doesn't require a physical presence or has legal pressures to keep it onshore will be at risk. It will likely get worse over time, just like manufacturing. I don't know what the future will look like if we continue outsourcing everything. It used to be that we outsource primary and secondary sector activies so that we could expand tertiary industries. What are we replacing the outsourced jobs with now?