Back in March, dozens of my colleagues and I learned we’d be losing our accounting jobs on July 1 to our partners in India. I didn’t break out the pitchfork though. Nor did I call my congressman to complain. Rather, I imagined the brighter future that would result for my daughters.
I came to this medical device company a couple of years ago when my previous company in the energy industry was broken up and sold after going through Chapter 11 bankruptcy. Having survived multiple prior restructurings, I’m familiar with market turbulence.
But whereas that company was more directly affected by unstable monetary policy, my current dislocation is an example of growing pains toward progress.
One of the more unfortunate turns our politics have taken over the last decade has been away from free trade and globalization, and toward protectionism. This can be traced back at least to 1992 presidential candidate H. Ross Perot, who warned of a “giant sucking sound” of jobs leaving the country.
It was even parodied on a 2004 episode of South Park. “DEY TOOK ERR JOBS!”
Around the time of that episode, India was the I in BRICs, a block of countries (also Brazil, Russia and China) that was participating more in the world economy. One thing India has a lot of is people. The more you have of something, the less expensive it is.
Labor is not immune to that logic.
This comparative advantage that affected our domestic textile industry back in the days of Perot, has now found its way to some white-collar jobs like mine. It’s not however, necessarily a bad thing, nor is it necessarily all such jobs.
To state the obvious, the economies of North America, Western Europe, and East Asia are the most advanced in the world. Others, like the BRICs, are at earlier stages of development. There are benefits to them assuming tasks like these.
First, American-made goods and services (we still make stuff, contrary to political talking points) will have new customers. These transitioned jobs are upgrades for these folks. The higher pay will pull many out of poverty, and leave spending money in their pockets.
Plus, some of these American-made products will be brand new, things we’ve never seen before, or improvements on older versions. The less my former company spends on labor and office space, and can redirect those savings into research and development, the more likely this is to happen. I won’t lie, it was an odd, somewhat humbling experience training my replacements. If management can make the transition work though, they owe it to the shareholders (i.e. owners of the company) to do so.
Though my three remaining colleagues are likely facing rough seas in the coming months, they have options, like changing career tracks altogether. They could take the slightly longer route like I did when I went back to grad school.
Or, there is a plethora of certification programs and whatnot at a community college like the one where I teach economics in the evening.
Also, our company is certainly not the first of its size to offer a menu of continuing education. Not a week went by when our team lead didn’t mention the arrival of artificial intelligence, and how we should be prepared for it. AI automation was as much of a threat to my job as moving it overseas.
Diversifying your skillset opens up possibilities. So does going local.
In addition to multinational corporations, metros like San Antonio are also home to numerous midsize companies. They aren’t as likely to move work out of the office, much less to the other side of the world. Small businesses even less so.
The next person to open their own business after getting laid off won’t be the first. This could be the prime time to take the dive, especially if there’s a decent severance package to use as an initial investment. Regardless, financing will find a good idea and viable business plan.
Not only would that provide an independent source of income, but they’d be their own boss. Maybe create a job opportunity for a couple of folks. It might even go gangbusters, attracting customers outside of city limits, creating a sort of trade surplus for the local community.
Politicians like that phrase. “Trade deficit,” not so much.
“We import more than we export.” That’s all they see, it’s bad, end of story. However, something else we import is foreign savings (i.e. foreign direct investment or FDI), the mirror image of the trade deficit.
The aforementioned textile industry of the southeast gradually morphed into a burgeoning automobile industry. The factories that churn out foreign cars exist as a result of FDI. We have one right here on the south side of San Antonio—the Toyota truck plant.
FDI is a vote of confidence. We’re so productive, we simply don’t have enough savings to keep the American machine going ourselves. Moreover, we like to enjoy the proverbial fruits of our labor by buying toys, taking trips, etc. Work hard, play hard.
That productivity is a magnet for foreign investors. They are happy to plug the financial capital gap, confident they’ll earn a good return. That’s just one lesson I’ll take with me to my new gig.
I will be teaching economics, among other subjects, to 8th graders. It’s an incredible opportunity that I’m still trying to process (my daughters didn’t take AP Econ until their senior years!).
This wouldn’t have been possible though, if I’d simply clocked into my old jobs, performed the defined tasks, punched my card at 5:00, and checked-out completely. We have to be ready to adapt in a dynamic economy, just as sure as companies have to adjust if we leave them for another, better opportunity.
The less we’re held back by where we’ve been, the more our kids can lead the way to a brighter tomorrow.
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