Should We Fear High-Pay Job Shift?
Adam Bartkowski, president of a Long Beach company that makes software that runs factories around the world, is very impressed with his new operational center -- in Krakow, Poland.
Software designers there are well-educated and highly skilled. Not only that, but they work for $25,000 to $30,000 a year, a third to one-half what they would command in the United States.
So Bartkowski didn’t have to think too hard about Apriso Corp. opening an office in Krakow. And that put him and his company at the edge of a frontier of the global economy, a terrain filled with challenges for U.S. workers and companies.
Poland is a new outpost for the high-tech industry, which in recent years has created jobs in Bangalore, India; Shanghai, China; and many other countries. Bright, young non-Americans do everything from carrying out online customer service to designing and manufacturing computers, semiconductors and software for some of the world’s largest U.S.-based companies and institutions, including General Electric Co., the World Bank, Oracle Corp. and Microsoft Corp. Japanese and European companies too are outsourcing sophisticated work to low-cost, high-tech parts of the globe.
And that trend is sparking fears that the days are numbered for good-paying technical and white-collar jobs in this country. “Is Your Job Next?” scream identical headlines in Business Week and Fortune magazines. Both magazines wrote articles based partly on a report by Cambridge, Mass., consulting firm Forrester Research that predicts cost-cutting companies will send 3.3 million U.S. information technology jobs overseas in the next decade.
Forrester analyst John McCarthy, who wrote the report, says the picture behind the impending job shift isn’t necessarily pretty. “The U.S. is in for another wrenching reinvention of industry in the next 10 years to bring costs down and productivity up,” he says. “Overseas production is only part of the story.”
He’s right. You’ve known for decades that your computer or your child’s Barbie doll was made from parts originating in a dozen countries that supplied the big U.S. market. Now you’re going to have to get used to the fact that the whole world is the market, and that yesterday’s low-wage Chinese workers are today’s higher-wage consumers.
It’s the story of what Bartkowski calls linkage: The links between factories and continents have grown exponentially in recent years, thanks to heavy investments in computing and communications and the development of the Internet. At the same time, there have been major shifts in global politics.
With the end of communism in Eastern Europe and the economic emergence of India and China, “new linkages of people have occurred,” Bartkowski says. “Now 5 billion people are connected,” he adds, an unprecedented 83% of the world’s population actively involved in the global economy.
Bartkowski immigrated from Poland at 13 with his parents; his father, a butcher, “wanted to own a house, which was impossible in Poland then,” he recalls. At 52, Bartkowski, who has a master of business administration degree from Northwestern University, heads a company that makes software systems, costing $200,000 to $1 million each, to run assembly lines and industrial processes all over the world.
Apriso was formed only four years ago when Bartkowski, a veteran of the data processing industry, joined venture capitalist Brad Jones of Los Angeles-based Redpoint Ventures, which invested $4.8 million in the company. Apriso now has $21 million of venture capital behind it and about $25 million in annual sales, plus large ambitions. “I look for us to be a multibillion-dollar company,” Bartkowski says.
In the expanding global economy, that could happen, says James Watson, a partner of CMEA Ventures, a San Francisco firm that has invested in Apriso. “I like the fact that Apriso’s software allows workers on the factory floor in China, or wherever, to change the program on their own to improve production,” Watson says, “and that it can be translated instantly into any language or character set. Smart people are everywhere and they can work with this software.”
That’s what inspires the graduates of Krakow’s science-oriented Academy of Mining and Metallurgy, who are eager for borderless jobs as their country opens new horizons by joining the European Union.
But what about U.S. college graduates? Bartkowski says they shouldn’t worry, not that they could stop what’s happening.
“If we try to cut ourselves off and say we will only do business as Americans, we will not have a business,” he says. Anyway, he adds, the United States is still in charge. It is what he calls “the creator of the framework infrastructure” of the world economy. And as the manager of the whole economic empire, it calls the most important shots.
“Another part of this equation,” Bartkowski adds, “is that 5 billion people connected make the world a much bigger pie. Don’t be afraid of the bigger pie.”
Yet we are afraid, as headlines about “Your Job Next?” indicate. The truth is that we have to accept that the number of well-educated and talented people, willing to work for less than we are, is growing. Welcome to the globalization of work.
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James Flanigan can be
reached at jim.flanigan
@latimes.com.
