A Bad Time to Be A Professional

Posted by: Michael Mandel on May 13

If you’re an engineer, a networking/IT/software worker, or a ‘creative’ type, you have the right to feel terrible. The stretch since Lehman went bankrupt has been absolutely horrible for most professionals (Exceptions: Education and healthcare occupations, and perhaps legal).

I just did some analysis on BLS data, and the results were stunning. Since Lehman went bankrupt, there’s been a complete labor market collapse for many professional occupations. Over the last year, professional employment is down -0.7% (the average of the three months ending April 2009 compared to the average of the three months ending April 2008).

That’s bad enough, but that number is boosted by growing employment in education and healthcare occupations. Other professions are disaster areas. Take a look at the table here.

BAD NEWS IN PROFESSION-WORLD
percent change in employment
August ‘08- April ‘09*
Computer and mathematical occupations -9.3%
Engineering and architecture occupations -10.3%
Life, physical, and social science occupations -2.3%
Arts, design, entertainment, sports, and media occupations -11.5%
Total employment (not seasonally adjusted) -4.3%
Total employment (seasonally adjusted) -3.0%
*Three month moving average. Not seasonally adjusted unless
otherwise noted
Data: BLS Calculations: Mandel, BW

Yikes! These numbers are scary. A 10% decline in engineering occupations in just 8 months? A 9% decline in computer and mathematical employment? An almost 12% decline in “creative” occupations, such as designers and the like?

I’ve got charts down below the fold which are even scarier.

But first, let me tell you what’s in each of these groups. The ‘computer and mathematical occupations’ are mainly software engineers, computer scientists and systems analysts, with some network analysts and the like thrown in. ‘Engineering and architecture occupations’ (actually the BLS reverses the order) is roughly 67% engineers, about 10% architects, surveyors and the like, with the remainder engineering and mapping technicians. ‘Life, physical, and social science occupations” includes natural (and unnatural!) scientists, psychologists, economists, market and survey researchers, urban planners, and a variety of scientific technicians. And last but not least, the arts or “creative” category, as I call it, includes designers, actors, artists, athletes, dancers, musicians, reporters, editors, writers, photographers, and everyone else that goes along with that. (If you want to see a full list for 2008, go to here).

What unites all of these groups is that they are all producers of “intangible investments.” That is, engineers, scientists, computer software engineers, artists, designers, and so forth all create long-lived intellectual property which has the potential to contribute to the economy. This includes new software programs, new products, new pieces of art and so forth. Writers produce written works of various degrees of usefulness, but in the aggregate are beneficial.

With the exception of software, the government statistics for GDP pick up very little of these intangible investments. That is, they pick up the part of spending which supports current consumption, but not the part which benefits the future.

Okay, here are the charts you’ve been waiting for. They are based on three month moving averages, because the monthly numbers jump around too much.


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eng.gif


sci.gif


creative.gif


These charts appear to show that the plunge in employment has levelled off, but I'd like to see at least another month or two before I conclude that.


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Reader Comments

Ajay

May 14, 2009 06:23 AM

Eh, just goes to show that we're all affected by a recession. Also, there's been more foreign competition for intellectual work recently because of globalization and the internet. But the real structural issue is that plenty of capable people can't get jobs because they don't have a PhD or 5 years experience, the idiotic job requirements that most firms use to filter candidates. That will change because the creatives will be able to easily hang out a shingle online and all will be able to form temporary online groups for projects, like how a movie crew comes together for a film and then disperses. We're just behind in creating the environment for that, enabling technologies like micropayments among others, but we'll get there soon enough. The WSJ just announced that they're setting up a micropayments system later this year, so we're well on our way.

CompEng

May 14, 2009 11:19 AM

@Ajay,

Yeah, there's a serious problem with companies hiring very narrow skill-sets rather than people. You haven't worked for 5 years with the exact bizarre set of tools and languages we use on the specific chips that only our company makes or uses? Not qualified. Companies have been spoiled by the huge tech labor pool.


When demand goes down, those most directly related to production (present or future) will naturally suffer the most.

BIGWEEDS

May 14, 2009 08:18 PM

Folks,
Has not everyone heard about all of the shovel ready projects that are being financed by the big stimulus package that our leaders have passed into law? All one needs to do is to go to their local hardware store and purchase a shovel and head to the nearest construction company. The pay may not be great but hey one can really connect with nature in all of its summer glory like 100 degree plus days and muggy rain. Rain is good because it softens the earth and thereby makes shovling easier. Is it not the best thing one has ever heard about?
Regards

Kartik

May 15, 2009 01:45 AM

I thought Michael used to say that the productivity gains were overstated.

Now, he is saying that the high productivity gains are due to R&D workers being axed.

So which is it?

Joe Cushing

May 15, 2009 06:54 AM

Ajay,

I recently finished an MSF degree. When I search for Finance positions; I often find job postings asking for a level of experience that, if I had it, I would be looking for a promotion above the job advertised. I found a company advertising entry level jobs in another state yesterday. I don't want to move but I'm thinking of applying.

Hill

May 15, 2009 02:34 PM

I can empathize with you, Joe. The job market cooled off while I was in b-school and instead of getting to pick from several job offers at graduation, I found myself scrounging for anything, including entry level in other states like you. (I took a sales job for a year just so I could pay bills) Eventually things will get better. You just need to be active and agressive in your job search and networking. Work on your interviewing skills as much as possible.

Fed Up

May 15, 2009 03:31 PM

Assuming what Michael Mandel writes is accurate, what justification exists for continuing the H1B "temporary non immigrant" visa program? After all, the premise of H1B is that there are "skills shortages" requiring foreigners to fill the gap on a "temporary basis".

Vivek Wadwa reported this week that there are 1 MILLION H1Bs already on US soil.

This is an outrage!

As there are obviously no "skills shortages" now, H1B must be terminated!

ALL Einsteins, without exception, can still enter America via O-1 visas (which have no quota) for persons of "extraordinary ability".

All Americans, contact your Congressional representatives and DEMAND they support S.887--the Durbin/Grassley H1B/L1 reform bill.

Earthling

May 15, 2009 03:56 PM

If you want some stodgy corporation to hand you a regular paycheck, forget it. But it is a great time to start your own company and bring on top talent. The problem is that precious investment capital is being squandered on futile life support for zombie industries and corporations with political power, or tied up by the trillions in ultimately worthless government bonds that do nothing for economic development, but simply sustain ruinous government borrowing binges.

scott

May 15, 2009 04:01 PM

I agree that many companies are hiring based on narrow skills sets rather than proof of exceptional performance and talent in a general area. Both advertisements and interviews seem overly focused on having years of specific experience in a method. This is myopic and will result in missing out on talented people who have a slightly different skills set but incredible talent. Why are companies becoming this way? Is it the same reason that AIG went bankrupt? Too much narrow focus on profit and not enough on being a good business? Too much Harvard MBA and not enough ethics?

CompEng

May 15, 2009 04:13 PM

@Fed Up,

Would you rather have more jobs in America that you can compete for at slightly lower wages, or would you rather have many of those jobs overseas where you can't compete for them, but the few that remain are slightly higher paying. I think those are your choices.

For myself, I think it's economically in my interest to make employing "guest" workers as cost equivalent as possible to employing American citizens. Considering the costs of travel and education and the pain/risk involved in moving to a new country, that should leave Americans a slight advantage on an individual basis.

I'm confident I'm a better bargain, on average, than most such guest workers. But if we push too hard to protect American workers, human nature indicates we will be perceived as less valuable.

Karl

May 15, 2009 04:54 PM

There is PLENTY of work out there in America! If you can climb a ladder, & you're not afraid of getting dirty, then you can have ALL the work you want!!! However, most Americans want to sip on coffee all day long, eating junk-food, checking their e-mail, & making a six digit salary. Those days are GONE, & they won't be coming back!

Tim

May 15, 2009 05:27 PM

This makes it all the more incredulous that companies like Microsoft and Google are still asking for more H1-B visas. If these people really are "best and brightest", let them come in through O-visas for extraordinary talents. It really is time to put a stop to H1-Bs and L1s. I don't buy for one minute that these jobs will be outsourced if they are not taken up by H1-Bs and L1s. Not all tech jobs can be outsourced. Some will always remain because they need close client interaction.

Lord

May 15, 2009 05:27 PM

The notable feature about this is these areas, with the exception of Life.., are actually being hit harder than the economy as a whole. The limitedly educated are probably not even being hit as hard. These are areas to avoid in the future.

JC

May 15, 2009 05:35 PM

Wow Karl. You must not have many friends, live near any major factory or read the news much. I read a lot of blogs and posts so I see my fair share of idiocy. Thanks for taking it to a new level!

Fed Up

May 15, 2009 06:01 PM

@ CompEng

You present a false dichotomy. You assume that more guest workers means more jobs. You also assume that in the absence of H1B/L1 "temporary non immigrant" guest worker visas, that more outsourcing would automatically result.

What is the source of your implicit claims that more H1B/L1 "temporary non immigrant" guest worker visas means more US jobs? Surely you will not cite the "National Foundation of American Policy" (NFAP)?

The "National Foundation for American Policy" (NFAP) is a ONE-PERSON "foundation" run by H1B shill Stuart Anderson.

Stuart Anderson, aka "National Policy for American Policy (NFAP), claims that; "For each H-1b visa position requested, U.S. technology companies increase their employment by an average of five workers".

http://www.nfap.com/pdf/080311h1b.pdf

This "study" has been debunked by University of California Computer Science professor, former statistics professor, Norm Matloff. He does so by exposing the errors (fraud?) in Stuart Anderson's (NFAP) statistical regression analysis.

http://heather.cs.ucdavis.edu/Archive/NFAP2.txt

The Wall Street Journals Carl Bialik has also debunked the NFAP (Stuart Anderson) claim. He did so by sending the NFAP "study" to several statisticians, and most questioned the findings.

http://blogs.wsj.com/numbersguy/the-debate-over-h-1b-visa-numbers-652/

In short, you have NOT established that more H1B/L1 "temporary non immigrant" guest worker visas means more US jobs.

The second part of you claim is that without H1B/L1, more outsourcing would be the inevitable result. This is another dubious claim. After all, India commerce minister Kamal Nath calls H1B the "outsourcing visa".

India commerce minister Kamal Nath; "If at one point you had X amount of outsourcing," he said, "and now you have a much higher quantum of outsourcing, you need that many more visas."

http://www.iht.com/articles/2007/04/12/business/visa.php?page=1

Assistant professor of public policy at Rochester Institute of Technology Ron Hira has shown that H1B/L1 in fact FACILITATE outsourcing; "First, it facilitates their knowledge transfer operations, where they rotate foreign workers in to learn U.S. workers' jobs: U.S. workers are "transferring knowledge" often under duress. Second, H-1B and L-1 programs provide them an inexpensive onsite presence that enables them to coordinate offshore functions. Third, the H-1B and L-1 programs allows the U.S. operations to serve as a training ground for foreign workers who then rotate back to their home country to do the work more effectively than they could have without such training in the U.S."

http://www.prospect.org/cs/articles?article=how_guestworkers_promote_outsourcing

If curbing H1B/L1 "temporary non immigrant" guest worker visas would increase outsourcing as you claim, why is India Inc fighting curbs on H1B/L1 tooth and nail?

NASSCOM Chairman Ganesh Natarajan explained; "Last year, out of every three (H1B) visas applied for by a company, only one was issued. This year also the ratio was the same. The professional visa [proposed through WTO agreements] would have taken care of this irritant," said Natarajan. This visa restriction has forced IT firms to hire more American workers for onsite jobs. This pushes up their labour cost.

http://www.dnaindia.com/report.asp?newsid=1181807

NASSCOM will demand "service visas" instead of mentioning H1-B/L1 visas; "With the anti-outsourcing sentiment in the US touching all-time high owing to large-scale job-cuts, Nasscom, the apex body that represents the Indian IT outsourcing industry, has decided to change its strategy on the proposed H1-B, L1 visa legislation in the US Senate.

Nasscom has been quite vociferous against the proposed legislation introduced by senators Chuck Grassley and Dick Durbin. But now it does not want to talk about H1-B or L1 visa. Instead, what it wants is the "service visa".

http://www.business-standard.com/india/news/nasscom-changes-stanceus-visa-issue/357471/

Truth be told, some outsourcing and offshoring is inevitable. It's not even necessarily a bad thing. In fact, outsourcing/offshoring in and of itself is neither good or bad--and can be either. What is deleterious is flooding US labor MARKETS with H1B/L1 guest workers with the intention of skewing the natural interaction of supply and demand. (See quote from Alan Greenspan at bottom of blog post)

H1B was never meant for the "best and brightest" anyway. H1B is supposed to relieve "skills shortages" on a "temporary basis". However, as the author of this article shows, there are no shortages in this economy.

O-1 visas are designed to allow persons of "extraordinary ability" to take up residence in the USA as immigrants. O-1 visas have no quota. Hence, abolition of H1B/L1 would have has no effect on persons of "extraordinary ability" entering the USA.

Finally, the Durbin-Grassley H1B/L1 reform bill would NOT terminate these visa programs anyway. Legitimate "skills shortages" would surely be able to get past the core provisions of the Durbin-Grassley H1B/L1 reform bill. As such, the H1B/L1 guest workers would benefit because their claims of racism and xenophobia would have merit;

1) Require all employers who want to hire an H1B/L1 guest-worker to first make a good-faith attempt to recruit a qualified American worker. Employers would be prohibited from using H1B/L1 visa holders to displace qualified American workers.
2) Prohibit the blatantly discriminatory practice of "H-1B only" ads and prohibit employers from hiring additional H1B/L1 guest-workers if more than 50 percent of their employees are H1B/L1 visa holders.

As a parting shot, I quote ALAN GREENSPAN, former chairman of the Federal Reserve; "Our skilled wages are higher than anywhere in the world," he said. "If we open up a significant window for skilled workers, that would suppress the skilled-wage level and end the concentration of income."

http://www.boston.com/business/globe/articles/2007/03/14/greenspan_let_more_skilled_immigrants_in/

CompEng

May 15, 2009 06:06 PM

Tim,

Not all tech jobs can be outsourced. But do you really want the only jobs in the industry to be the ones that can never be outsourced? Is that really good for the economy or for our own competitiveness?

If Microsoft et all are unfairly biased towards H1Bs, you can bet it will cost them, because there are some competitive advantages to growing up in America. There are weaknesses too, but that's why you can't dictate these things. In this, I'm ok to let the market decide.

Scorpio

May 15, 2009 06:21 PM

Fed up,
First, you should change you're Screen name. ur not Fed up. BUT ur highly selfish, ignorant and greedy person. who wudn't think twice before throwing people off the sinking boat, to survive!!!

Offcourse, h1-b has issues and falws and offcourse it's not needed in this economy. I guess US govt still issued H1-B just to make money($3k per H1-B).
H1-B is exploited by the US companies, by the Offshoring companies and by the US Govt!!! and so are US middle class also getting into this dirt..its sttruggle of middle class Vs the Rich.

So, now you think, just coz 1million people are on h1-b and u dont have job(citizen) ..govt sud throw them out? US govt doesnt spend single PENNY on the,..no healthcare , no social.no unemployment..though they pay equal taxes..Like that was not enough..there r greedy dogs like u.who want to throw them out..just to save their ASS...wat kind of morality wud that be? what kind of humanity wud that be? and what kind of justice wud that be??
May be if ur still hungry then u wud request the Govt to attack other countries and snath their money..coz US economy is down??????????????

u need some soul searching dude!!!be a human first..don;t be so greedy that u bite urself.............life is too short!!

NJobserver

May 15, 2009 06:37 PM

Speak to congress, asking them to support S.887--the Durbin/Grassley H1B/L1 reform bill as FedUp mentioned. Become part of interest groups speaking to the H1B/L1 issue. Only in groups will your voice be heard.

It's time to come together in opposition to the trade deals making millionaires among the elites while leaving the rest of us to the hard scrabbled existence of competing in the race to the bottom of the wage and benefits scale. Americans simply cannot or will not compete with people willing to cram three generations of a family into a five room home (1 home in U.S. = 4 in Japan); or go abroad to sleep in shifts in an all night boarding houses. There's a lot of talent in the U.S. but it may be the myopic nickle and dimer autocrats running our corporations won't figure the outcome of all the outsourcing until we simply can't afford homes or education, or healthcare, on the nickles and dimes we're paid.

lark

May 15, 2009 07:42 PM

We've had a long run of the dominance of the 'consumer' during which we mostly forgot about the role of employment. We thought we had a 'consumer driven' economy. Of course we didn't! We had debt making up for stagnant and declining wages. Now we've hit the wall, and the decline is translating into lost jobs.

I think we are going to learn to emphasize jobs in policy and media coverage the hard way, through suffering, bankruptcy, and decline. We've been focusing on finance; next up, desperate measures to shore up employment.

SallyChicago

May 15, 2009 10:52 PM

I'm sick of coming to these boards and reading the debate about H1B or HB1 or whatever the h**ll it is. You guys need to get over it and go on with your lives. Get another occupation and stop obsessing about IT / engineering work. It's over. Go learn how to fix a car or train to be an electrician. Most of you guys on here are probably 50ish and yearn for the days when you made $100,000 just to hook up two computers. Anybody can do that, dude! Even 10 year olds can do that! Move on!

Zb

May 15, 2009 10:59 PM

Engineers have felt the effects of the downturn for years now, while Wall street, business consultants, and real estate agents led the good life on easy credit. Now everyone's suffering. But it is kind of nice to know that not every mediocre college grad will feel entitled to a good job. Also, for those who do okay or well even in this secular downturn, they will be living in a less prosperous society- one in which they need to watch their backs and not simply drive around in new beamers thinking that people admire them. Humility may actually become in vogue again...wouldn't that be nice.

I for one am not totally against H1B's though I have been victimized by their presence no doubt. I think nature will eventually weed out corporate America's short-term thinking...that is, hiring cheaper labor and not really cultivating the seeds of quantum-leap improvements. New innovators, either here or abroad, will emerge and the H1B's who come here will start to question why they are working like drones when they could be doing more exciting work or forming their own companies. For now, they are understandably just trying to put food on the table.

The crop of current executives who climbed the corporate ladder, only to sell out their countrymen to satisfy next quarter's profit targets, will be quickly forgotten. Most of them will never get their day of justice, but will simply be viewed as trash by the thinking class. Perhaps with the exception of some such as the Google founders and Steve Jobs.

Ansh

May 16, 2009 12:50 AM

@Fed UP

First of all,Mr.fed UP,I don't think you are a real professional and certainly not belonging to one of the STEM(Science,Technology,Engineering and Mathematics) fields because if you were one of them,you wouldn't be proclaiming wht u just said in one of your comments in this article and one thing for sure is that you're really afraid of the competition.The fact that large companies like GOOGLE,MICROSOFT,INTEL and ORACLE want the H-1B cap to be increased from 65,000 to 195,000 is enough to justify the need of skilled people in U.S.A.Its takes almost $3000-$4000 to sponsor an H-1B.Why would you think that big corporations are ready to spend such amount to hire someone on a work visa when they could hire an American worker for free???there has to be some reason,right??It's not necessary that every skilled worker has to be "Extra-Ordinary".I really feel frustrated when I successfully clear the technical rounds and at the end I am asked-"Are you a U.S citizen,permanent resident or Greencard holder? and when I say No,I hear that Big word-"SORRY"...And 2-3 months down the line,i see the same job posting on the company's website.Reason--They're not able to find an american worker who could do that job.Irony...GONE are the days when only a M.S degree from an American university could get you a good high-paying job anywhere in the world just like that.Nowadays,EXPERIENCE is what counts.Consider this,90-95% of the people pursuing M.S degrees in Engineering in U.S universities are International students and do you know how much money it takes to pursue M.S here???U.S universities earn BILLIONS of dollars from it and in return pay taxes to the government which the government utilizes to fund studies of the citizens.And after 2 years of slogging our ass,putting hard work,studying all those complex courses so that we could find a better job here to take some experience,contributing to the economy with our engineering expertise,we get to hear this from guys like you??????Naah,not fair dude...And it's not only corporate jobs where H-1B workers are hired...I give you an open challenge...Open the website of any good U.S university with an Engineering school and see how many professors are foreign nationals..Do it right now..any university and you'll come to know why U.S badly needs the H-1B program...There may be some discrepancies out there in H-1B visa program but if you say that the H-1B visa should be totally eliminated then I'm sorry,my friend,I ain't buying that crap...That's all I have to say...peace..

Jim

May 16, 2009 09:23 AM

Ansh - I am so glad that is all you have to say. Because I am so tired of some Indian telling Americans why it is so great that Indians are taking American jobs. And to say that we need Indians to support our Universities is sheer idiocy. The cost of an undergraduate degree is quickly outpacing the ability of Americans to pay for it. Why? Demand. Indians come here to take advantage of our government subsidized universities, driving up demand and thus tuition costs. Not only do you take our jobs for sub-standard wages, you leech off our government subsidized education system as well. Go build your own damn universities and take your professors with you.

CompEng

May 16, 2009 12:52 PM

Fed Up,

I don't quote NFAP. I was more speaking of my own field and experience. Matloff makes some good points, but most of the seem to be relevant to a very specific field, as well. Mainly, my reasoning flows from general economic principles, from my experience working with H1Bs as a technical contributor, and from my experience as an interviewer.

For multiple reasons, It's very difficult to hire truly qualified people in my field (microprocessor design and validation). The ability to generate and maintain critical mass in the needed skill sets dominates my ability to work in a given design site. If you took away all the H1Bs I've worked with, that would severely damage that critical mass. Replacing them with Americans of similar quality willing to move to the area and work for the same pay as I do (good enough to support a 4-person family in a suburb with a single income in the Boston metro area) is probably not impossible, but certainly difficult. How can I not draw the conclusion that my job partially depends on those H1Bs? IT services may be a different scenario, but I suspect there are similarities.

Yes, a larger pool of labor necessarily will reduce wages, but that pool of labor exists whether we use it or not. And if we don't, someone else will in some other country.

That said, I do think we should encourage any foreign labor we draw here to stay here and lure them into the American standard of living. :) We need much greater protection for the freedom of foreign laborers, and we should in fact penalize the body-shop temporary visas. More permanent visas should be cheaper, and easier to obtain. I'm not sure how to accomplish that, but I think that's a more productive line of attack than keeping people out of America.

Ansh

May 16, 2009 01:23 PM

@Jim

Jim,my friend,there's a lot of falsity in your facts there.I am really surprised that you think only "Indians" are responsible for the mess that has been created here.You have mentioned in youre response--"...Indians come here to take advantage of our government subsidized universities, driving up demand and thus tuition costs??????"
AND "...Not only do you take our jobs for sub-standard wages, you leech off our government subsidized education system as well??????" AND "...to say that we need Indians to support our Universities is sheer idiocy??????"...All these comments are simply baseless...The university where I pursued my M.S had 45 students enrolled in the program(all International students!!) and you know what was the course fee-$29,000...Multiply that by 45 and it becomes HUGE...And all this money is used in building new labs,buildings,scholarships that are going to benefit not only International students but any student who is a part of it,right??If you read my comment carefully,I have mentioned "International Students" which includes Indians,Chinese,Japanese,students from all over the world and not only Indians,buddy...Tell me how many of your American friends are pursuing M.S in any field of Engineering,,,1,3,5,6?? and I will show 50 of my friends pursuing their M.S in different universities here.

Now,I am not boasting about anything here but consider this...All of 'em are going to work for American companies after graduating...Some of 'em would be part of cutting-edge research,some would go ahead and pursue their Ph.D and teach in American universities,someone may invent the next Pentium Chip(Inventor--Mr.Vinod Dham[Indian]),someone would create the next Hotmail(Inventor-Mr.Sabeer Bhatia[Indian]) and some of 'em might work for NASA(36% of NASA scientists are Indians)...We all contribute in making this country run better..sometimes more than you guys..and you say--"Go build your own damn universities and take your professors with you"..Yeah,right...And,let me tell you,I love U.S.A as much as I love my country INDIA.I was pleased by the hospitality of this country and its people when I arrived here 2 years ago.But sadly,some people don't reflect the same anymore...peace...

Zb

May 16, 2009 06:09 PM

I must agree with Ansh with regards to the value of foreign students who come and stay here. Russians, Italians, Indians, Chinese, Japanese, etc. essentially be come part of the U.S. and contribute nicely to technology and other industries.

However, what I have a problem with is executives' outsourcing efforts that bring temporary workers here for essentially training purposes, only to eventually establish satellite organizations abroad. They would like nothing better than to run marketing houses here that employ worker-bee engineers abroad. However, those kinds of actions only destroy long-term prospects for the U.S. to continue to be the leader of innovation.

CompEng - you are right that as of today, foreign workers are probably critical to establishing the critical mass for successful design work. However, do you think this is a shortcoming of our educational system or a cultural shortcoming? Have you stopped to think that maybe policy decisions landed us where we are today? Doctors have been much smarter than engineers in lobbying to protect their high demand and high salaries.

I think a cultural shift toward instant gratification, along with the economics of the situation, determine why there are fewer Americans studying engineering these days. Finance, law, advertising, marketing, sales, medical services are fields that give a better return for your money and effort. Why, then, should American students study math, physics, VLSI, and computer architecture only to make 70k a year when a person of the same talent could be making double that with a few more years with an MBA or law degree?

CompEng

May 16, 2009 11:00 PM

Zb,

I'm not sure whether foreign workers being "required" for critical mass is a cultural or educational failing, per se. One of my managers has pointed out that the top 1% of all engineering students worldwide dwarfs the number of American engineering students. I think it's just become a global profession.

Of course, our culture gives more coolness points to singers, rock stars, and MBAs, so we tend to undersell science and engineering. But since many countries oversell it, what should we change? The AMA is a good part of why our health costs are too high: should the rest of us take a page from their book? Not sure. It's a complex world. Moving away from instant gratification is good, but we can't all move toward any one fad and call it a solution, either.

Zb

May 17, 2009 09:22 AM

CompEng,

I too have thought that perhaps engineering has just crossed all national borders due to its IP-oriented nature, and that it's just a leading indicator of the future of other fields. One reason is that the rudimentary or semi-advanced work in any fairly technical/quantitative field is easier to transfer since everyone speaks the language of numbers and logic, but it there are more barriers to entry into other fields (such as needing 12 years of certified medical training before being 'qualified' to check someone's lungs for emphysema).

I called doctors 'smarter' than engineers for protecting their interests, but maybe you're right in that this kind of protectionism doesn't make for a better society in the larger scheme of things. Ironically though, many are flying out to places like India for heart and other medical procedures to circumvent high costs here. But you can't exactly email yourself over to a foreign hospital when you're having chest pain on a Thursday night, so the AMA's protectionism continues to thrive...

Mike Mandel

May 17, 2009 02:53 PM

Kartik

"I thought Michael used to say that the productivity gains were overstated.

Now, he is saying that the high productivity gains are due to R&D workers being axed."

Hi Kartik,

It's both. The second half of the story is coming soon.


Tom E.

May 17, 2009 07:32 PM

In the 1980's, the factory worker (blue collar) was devalued.

In the 1990's the admin., back office worker was devalued (lower half of the white collar).

In the 2000's the skilled white collar worker was devalued.

In the 2010's it will be the certified skilled white collar worker (doctors, lawyers, etc.) who will be devalued.

Where does all this lead? I do not know. Certainly many people will be discouraged from spending the money and effort to learn skills and earn degrees that will not be worth much in the future. It is a deflationary spiral of the worth of work and skill.

If taken to the extreme, we could revert to a situation with a 1% aristocracy and 99% peasantry.

I am trying to think of what the upside to all of this will be. It seems like the only winners are the wealthy and those with political skills to please the wealthy (corporate managers, lobbyists, politicians and the military class). Like the old days of the aristocrats, their courtiers and soldiers (knights).

As people become discouraged, less skilled and lazy, they will lose political power, and rights to the few. Perhaps we are at the zenith of democracy. The pendulum has reversed and we are heading toward a more pyramid like society; monarchy, oligarchy.

These things run in long cycles, the industrial revolution devalued the skills of the masses and concentrated power in the hands of the few. Globalism and technology are the new devaluation tools.

Society has to move forward, but what will the future bring?

CompEng

May 18, 2009 01:28 PM

Tom E,

A co-worker of mine once pointed out that most productivity improvements don't come from a direct increase in the capacity of humans, but the complex machines we build. One could imagine a future where self-repairing, self-replicating robots do all or almost all of the real work to support a society. In such a world, the only economic factors of consequence would be: who owns the land, and who owns the robots?

I don't think capitalism in any recognizable form would survive in such a world. Whether we recognize it or not, we walk by degrees toward that world, with the economic juggling required to achieve a just society growing more complicated as we go.

Ming

May 19, 2009 03:36 PM

I'm a former software engineer, looking for work since last September, and this article agrees with my experience: the hiring in computer jobs seems to be way down. It's very frustrating to be very eager to return to work, to have a perfectly fine employment history of 30 years, and to sit here at home and wonder if I should put my home up for sale before I lose it to foreclosure in late 2010 (it appears that the housing market will do better than the jobs market in the near future). I really feel like I'm living in a third-world country: job and loan prospects are almost non-existent. I have plenty of equity in the home, but no bank will give me a loan if I don't have a job.

KB

May 20, 2009 04:15 PM

Flexibility, creativity, and hard work are what it takes. I saw my former field in trouble years ago, and decided to learn new skills to make myself more valuable.

I have had already had several careers and, and am only in my mid 30's. And I doubt my current one will be my last.

In the past year I have live in three states, been self-employed, done contract work, and currently have good paying full time job. It's not been easy, but I did it without going into debt, and without going back to school.

Wallstreet Banker

May 23, 2009 07:25 PM

Engineering and IT should ALL be outsourced. I would also add accounting to that list. Anyone that disagrees is a cry baby. I actually think 25% unemployment would be good for the country. Imagine how low wages would be! Next remove minimum wage; let the market decide the price of an employee. I can see a future where people work for pennies a day and I make billions. To dream, the impossible dream.

cm

May 23, 2009 09:53 PM

I'm perhaps late to the thread, but my perspective on the requirement and focus on high "skill" credentials (at least in the type of medium to large company that has been quoted) is this:

In many (tech) industries, after decades of steep growth, almost all of the low-hanging fruit is picked, further improvements come largely from interdisciplinary approaches and steeply increased complexity, the rate of "revolutionary" innovation stagnates, evolutionary improvement takes lots of effort for even small increments, and barriers to entry rise (in proportion to complexity, interdependence, and volume of the subject matter).

This leads to an environment with long(er)-lived legacy products or product platforms, and there is more demand for a "commodity" workforce army that is (1) enough qualified in the subject matter but (2) does rather mundane work to support the legacy products and execute all the bombastic business process that is now required to implement incremental improvements (remember, no more low hanging fruit).

By far the largest number of those workers does not need a PhD or similar credentials. The reason for artificially heightened credential requirements is that employers would prefer to throttle applicants as they are unwilling to pursue all applications, while at the same time trying to fish for the cream.

On a related note, I have seen some of the recent-coinage PhDs (or rather those that are willing and able to join my workplace), and I'm not too terribly impressed overall.

Ajay

May 24, 2009 08:00 AM

Cm, what you're essentially saying is that employers are either lazy or incompetent, so they hire PhDs or workers with 5-10 years experience with particular topics, rather than evaluating talent for their needs. An analogy for how ridiculous this is would be a construction company only hiring ballet dancers because they've spent years honing particular athletic skills. I'm not disagreeing with you, it's in keeping with what I've seen, just pointing out how ridiculous that common hiring process is. However, with the big changes that are coming, that I mentioned in my first comment, this idiotic hiring process will become irrelevant, as we move to a more project-based work environment online. Programmers will band together for various software programs, implementing features they think will be useful before moving on to other work online, similar to how open source projects work today. All writers, editors, podcasters, and online video producers will move to this project-based "movie" model, only online. One will be able to make a living doing multiple types of part-time work: programming 70 hours a month, writing 50 hours, and consulting for another 40 hours. Of course, one cannot completely banish the currently prevalent stupidity of overemphasizing dumb credentials, but in an online environment where entry and exit are easy and cheap and where there are better measures of capability available, that idiotic mentality will be marginalized. As for the other comments I've seen above, delusions of inevitable oligarchy or socialist utopia are too silly to bother with.

Tom E.

May 24, 2009 05:14 PM

If we decouple health care from employment, like a single payer system, then I think some of flexible bands of workers that Ajay talks about would work.

We should also decouple social security, Medicare and other safety net payments from an employee's paycheck and perhaps have a VAT tax instead.

Mike Reardon

May 24, 2009 07:22 PM

From Ajay above, "Eh, just goes to show that we're all affected by a recession." Japan’s export driven economy had its GDP contract 14.4% in the 4Q of 2008, and this year’s 1Q went down 15.2%. I see it as a world wide liquidity event, and until it plays out and the economy stabilizes it can't be fixed. Its what remains and restarts that will tell where employment can be found.

cm

May 24, 2009 08:47 PM

Ajay: To some extent the project-based paradigm is already here, but less so in a "free agent" form but as midsize to large companies switching from employees to contractors and temps where they can. This has already been the case in more "traditional" industries for the longest time. I'm not sure the movie industry is the right analogy, I'm thinking more of construction. But maybe movies is the same after all.

However, this paradigm largely only works for (literally) "commodity" projects that have limited scope, which is precisely the work that doesn't require ramp-up periods and "institutional knowledge". Projects beyond a certain relatively-trivial size cannot be done by matching a band of mavericks on craigslist.

So far nobody has figured out how to apply this to large, complex, and long-lived products/platforms that require 1+ year of in-house experience and continuous embedding within the organization to be effective. One aspect that I think has been attempted on occasion is replacing a small number of highly effective experts with a larger number of quickly brought in and superficially trained commodity staffers, but that usually doesn't work except for work that is self-contained (which means it's a project of the former category).

Once somebody figures that out (I don't think it's possible), this will be the end of professional careers as we know them.

cm

May 25, 2009 12:37 AM

An afternote, as little as I know about the movie industry, there are a lot of players, but the "big bucks" are probably dominated by relatively few "brand name" studios (whose names are familiar to us from all those mainstream titles) at the top of the movie production food chain, under whom you have multiple layers of production firms, brokers, agents, body shops, screen writers, technical contractors, special effects vendors, equipment/location rentals, etc. There is no dearth of stories of would-be actors, writers, producers, and a plethora of ancillary professionals hopping between part-time gigs and waiting tables in between (metaphorically or in actuality).

Doesn't sound like "banding together" to me. You?

Another thought in that context that is just popping into my mind -- a few years ago (during the ongoing SF Bay Area tech bust) I heard an anecdote about a UC Berkeley EE or CS graduate whose best shot at the job market was his dad through "connections" arranging a job retouching movie frames for some movie production firm. Well, at least it's a job.

Ajay

May 25, 2009 04:45 AM

Tom, nah, we'll decouple it by replacing it with private catastrophic insurance and actual prices, not costs made up to fool the govt.

Cm, contractors are the first step, but far from how dispersed it will be. Movies are not commodity products, the project model works for them. Institutional knowledge is largely a myth, what little is real can be saved online and paid for. Of course, you're not going to organize projects on a trivial website like craigslist, there will be a whole online market for matching people with projects, one of the other necessary changes I alluded to earlier. I think movies are an example of the large, complex projects for which you say it can't be done. Yes, the traditional professional career will be done, thank goodness. The movie studios are mainly distributors that don't make much of a margin, if any, while all those smaller markets you mention make a good living. As for would-be actors and writers, a lot of people want to be in the movies, hence they have to support themselves waiting tables while hoping to break in. Regarding banding together, I was just talking about coming together for isolated projects. You probably mean as a community and you're wrong in that sense too, they're highly unionized. That has been necessary because distribution was limited to a few channels, originally only theaters, then television and DVDs. With the internet now, those unions won't be necessary with distribution plentiful. As for the EECS guy, not all of the UCB guys are that sharp. Not that it matters, he wasn't hired cuz he had no experience so we'll never know.

cm

May 25, 2009 02:59 PM

Ajay: I think you misunderstood me (or I miscommunicated) in several places. Movies are not commodity, but much of the "technical" aspects of movie-making are. (Important point, "commodity" doesn't mean "cheap". It means (testable/observable) "standard qualities" of the subject matter. The most highly prized precious metals on this planet are commodities in various degrees of purity etc.) Yes, of course there are always innovations in e.g. camera tracking or special effects, and mastery of the art that goes beyond the average, but that exists in every profession.

As for banding together, I interpreted it as "grass-roots initiative", but that's apparently not what you meant. What I mean, and where you seem to agree, is that most business activity is driven top down and controlled by layers of middlemen whose major goal is to establish or maintain themselves as chokepoints, i.e. "corner the market". The way you are commenting on professional careers suggests you may be sitting on that other side of the fence (?).

Whether you are unionized or not matters only when you have leverage. Where unions and guilds were ever successful was where their members had enough aggregate leverage because the show wouldn't play without them. Union busting would never have been successful if there wasn't an oversupply of (qualified) labor.

As for institutional knowledge, I'm not sure you understand how it works, or how the difference between its presence and absence can be diagnosed. Much of institutional knowledge is tacit and situational. It's not just about observable, verifiable, or reverse engineerable facts, but also motivations and negative facts (something else has been tried and didn't work), and "gut feeling" - people having an internal representation of a complex subject matter and its dynamics, but without a formal model in which it can be categorized. That is, the only way to build this understanding is by "having done it" for an extended period and in depth and variety. Furthermore the "knowledge" can be distributed between several people who have to come together to reproduce it. Good luck extracting that out of people's heads and saving it "on a website", if they are even willing to share it with you. Such knowledge will never be built by a workforce of exchangeable transients.

As for that UCB guy, I don't know him and his degree of sharpness, and neither do sharpness and professional success correlate very much, in my observation. I have seen some ups and downs in software tech, and the successful people are overall those who get to build their initial career during the "up", not all of them being the sharpest. Whether you miss that train is mostly a matter of birth date. When you are not ready for your job during the up, you will easily fall through the cracks, simply by an aggregate lack of opportunity at the time you would need it. That window is only a few years wide, and you have little control of when it is open (but OTOH you know when it is).

Ajay

May 26, 2009 12:46 AM

Cm, I would define commodities as unvariegated product that usually have a well-known and understood production process, which usually drives margins and risk down (though not always, as with oil). Movie-making is the opposite of that, a highly complex process with many disparate intellectual workers, no matter how commoditized various elements are. As for banding together, it depends what you mean by grass-roots initiative, but I did mean that people would start various projects on their own, like open-source does today. I agree that a lot of business activity is top-down, not that that's necessarily bad, but while middlemen may try to corner markets, they almost never accomplish that, so such "choke points" are an insignificant factor. I've never had a job in my life, if that's what you're asking. The movie unions have tried to avoid the leverage issue by forcing people into their union: I've heard a SAG member complain that he was forced to join and his dues were extracted from his earnings, that it wasn't a real union as a result. Institutional knowledge is one of those nebulous topics that people can employ for all kinds of vague and specious arguments. If its presence cannot be diagnosed, I don't know how you can claim it as an advantage for any institution. If there's any value to such experiential but "gut" knowledge, which I don't necessarily concede, it can be reproduced by bringing together the same group temporarily. The only way you can argue that it can't is by claiming that the only way such gut feeling can be grown and then harnessed is by the same group working together for years, which is even more specious. However, the movie business puts the lie to your claim that such knowledge can't be built by transients. I agree that up-waves have a huge affect on careers, I've seen that myself during the last two cycles, but I think you downplay sharpness as a result. Obviously you have to catch an up-wave to get in the game, but intelligence still determines who goes the farthest within that group. As for those who fall in the down-wave, that's why flexibility and perseverance are such important attributes. If that UCB guy wanted or deserved to be doing EECS work, he'd keep plugging away and catch the next up-wave.

cm

May 26, 2009 03:20 AM

Ajay, it seems you are ridiculing my characterization of institutional knowledge, which is your privilege I guess. Perhaps the term "institutional" is unfortunate. If you have never worked for an extended period in an environment (or have at least observed one) in which different individuals or groups are dealing with different aspects of a complex or merely arcane subject matter, it could easily be unimaginable. You may want to check out the Wikipedia article on the subject. It is not very detailed but states the essence.

I don't find it fruitful to argue the movie industry any more, but I do know a bit about software tech, and one feature one finds in many organizations that either experience critical mass turnover and/or a breakdown of effective collaboration is that systematic and carefully considered work disappears and is replaced with hackery, kludges, people spending most of their time figuring out how something works (or why it doesn't), probing, and reinventing the same wheels over and over, and the big picture and the motivations underlying the structure of the product(s) being largely lost. Once you work in this mode, it becomes like medieval "magic" - sound reasoning and purposeful action is replaced by the programming equivalent of superstition, incantations, and following of more or less elaborate rituals.

Back to the issue of hiring "top talent", maybe the analogy of hiring wizards commanding the choicest credentials who can "make stuff happen" is not really that much tongue-in-cheek.

cm

May 26, 2009 03:25 AM

And on the subject of "plugging away", if there are no jobs there are no jobs (in your field). Of course there are never "no" jobs, but rather too few jobs for too many applicants. Somebody is going to be left with the short stick - probably those who don't persevere enough.

Ajay

May 26, 2009 05:58 AM

Aah, but nobody's arguing against "an environment in which different individuals or groups are dealing with different aspects of a complex or merely arcane subject matter," that's the future, only with your argument that the best way to create one is to "require 1+ year of in-house experience and continuous embedding within the organization to be effective." Even if one were to grant that, your assertion that this represents a not insignificant advantage to longer-lived institutions like a corporation is ridiculous. Regarding your experience in software tech, you seem to be positing that those listed obstacles can be overcome through incommunicable institutional knowledge, when the truth is that whether it's a long-employed group in a company or a constantly changing group of open source hackers, each has to consciously organize to combat that chaos, by clearly communicating with documentation and written plans. This tangible planning can equally well be done online. If hiring wizards isn't tongue in cheek, it's a honest assessment of the mess most codebases are in, which we both know is never admitted to publicly. ;) The point about too few tech jobs is that that cycle wanes and waxes: in 99-00, there were too few tech people. If you really want to do something, you keep after it. But I agree that the idiotic experience requirements that most companies use then screen somebody like the UCB guy out further, unless it's really the peak of a boom like 2000 was. My argument is that in the rapidly-changing online environment of temporary projects that will soon be mainstream, the effect of such vacuous credentialism will be minimized.

LAO

May 26, 2009 03:19 PM

Cm,

Don't be deterred from your concept too easily. I could not resist offering my opinion that I think there is a dearth of honest research into optimal organization size, structure, continuity and degree of isolation of the parts that might validate your view.

For instance, how did the last administration manage to increase the federal budget and employee count so much while decreasing agency funding and increasing outsourcing/privatization -- the war alone does not account for it, but nobody seems to want to look too closely. Within corporations, there seems to be a growing tendency to divorce specialization from industry/market expertise, and to me the results are mixed at best -- lack of innovation, accounting surprises, software tools that are obstacles to be worked around or worse yet are overly trusted and poorly understood facilitators of doom, etc.

A small businessman that I greatly respect flirts with industry organizations for one reason -- to find out whether his results are comparable to what the big players are achieving -- he outperforms them and attributes it to the efficiencies of optimal size and deep expertise -- otherwise he maintains as low a profile as possible as he is more than happy to let others think they are doing just fine relying on generic solutions and the blind leading the blind. I don't think the industry matters.

Any given project can be effectively accomplished by pulling together the right skill set, if the leadership has adequate knowledge of those skills and the larger context, but such unique super-heroes will surely cease to exist, or will deliver the same special recipe to competitors, if they are not grown within the business and tested in their specialization by the organizations that need them. Hollowing out the organization will only be effective to the extent that the crown jewels are not given away to achieve it. I suspect that corporate America is already pushing against that wall. I suppose this comment is really aimed at Ajay, and it is only an opinion.

cm

May 26, 2009 03:45 PM

LAO: What you are describing sounds familiar, and I would put it mostly on the phenomenon that success attracts careerists and financial types who are neither versed nor interested in the details of the subject matter, but at the very best take a "generic" approach to management.

There is OTOH the phenomenon that small and nimble organizations cannot do certain things at scale, e.g. taking on too many large projects or supporting a large customer base. (And many corporate players have "policies" not to deal with small players but only with "deep pockets" for risk control reasons - understandable.) As a consequence, the large players who are not nimble cannot do "small" things well, and large things only as well as any large organization where accountability as well as expertise and interest are heavily diluted.

In an automotive metaphor, you wouldn't look for max fuel efficiency, sprint acceleration, and small curve radius in a big rig. But a big rig will pull big loads.

Ajay

May 27, 2009 04:13 AM

LAO, that is an extremely confused and weak defense of the corporation. So large companies are divorcing "specialization from industry/market expertise" (what does that even mean?), their results are mixed, and small businessmen are eating them for lunch, yet corporations should grow talent and not hollow out? The coming online environment will be the death of any company that is big enough to not currently be considered a small business. Talent will do its thing regardless, the large corporation as nurturing mother is a myth.

Cm, the reason for generic management is that the companies are too big and the top executives have no ability to maneuver something so large, it's likely impossible. Look at a large corporation like Microsoft or one that's getting there like Google, their success attracts idiots who want to get in that boat and those companies' top executives have shown no talent to filter them out. The only behemoth that I can think of that continues to innovate and earn it's dominating position is Intel. But even Intel shouldn't be so big because there are no economies of scale at that size. Intel has multiple fabs, each fab may have some economies of scale but the collection doesn't. There's no reason why it couldn't be split up into several companies, each with its own fab, and be much more efficient. That's what we're seeing now anyway with the success of the Taiwanese fabs and how even Intel is using them now. Why should a small organization take on many large projects or a large customer base? We can have many small companies, each serving their small group of customers. As for corporate policies to not deal with small players, that'll be irrelevant when there are no large players. There is no reason for a big rig cuz there is no reason for big loads. Economies of scale is mostly a bullshit argument that has been vastly overused this last century, there is a Peter principle for concepts at work here. We will see it demoted in the coming decades, particularly when most work is intellectual work for which the argument cannot even be made.

cm

May 27, 2009 12:12 PM

Ajay: "their success attracts idiots who want to get in that boat and those companies' top executives have shown no talent to filter them out"

So this applies only to those who want to get into the lower charges?

"We can have many small companies, each serving their small group of customers. ... Economies of scale is mostly a bullshit argument"

You either don't know how industry works, or you are a contrarian who only takes opposing positions. Do you believe the big players, worldwide, all emerged only by conniving and and predatory business tactics?

Take the open source scene, which BTW I greatly value, but which I don't see as confirmation of "bazaar" business. For all the substantial achievement, almost all the money made "with" open source is in services (this idea was right in Stallman's initial screed) - maintenance and system integration (distros), the very things that are stong points of large corporations. Much of the (initial) software is created by hobbyists or in academia, and there is a significant body of software that was open sourced from academia, plausibly after failed attempts at commercialization. That goes to show that "bazaar" is superior, but not that it's a *business model*.

I wrote another lengthy response before LAO that the comment system apparently ate, so I won't invest much time into this here.

Ajay

May 28, 2009 12:46 AM

Cm, The idiots want to get in at all levels obviously; they just can't get in at the very top usually cuz the founders have a lock on that, like at Google. When you have a proven concept like Microsoft or Google, all the idiots want to get on that boat and history has shown us repeatedly that nobody can then manage such a big boat, particularly when it's replete with morons, which is why they decline quickly. I will however give Intel credit for doing a better job at this than most, not that they haven't taken a lot of idiots on too. If I don't know how industry works, it would be easy for you to state a single counterpoint rather than simply declaiming that I don't understand. As for just being a contrarian, that would make more sense if I were the one being inconsistent. You repeatedly bash large companies and yet claim that there are some magical, unnamed big loads that they need to carry. Whereas I say that economies of scale (EoS) is mostly a bullshit argument that has been overused for decades- it may apply somewhat to a single fab, but definitely not to a collection- and that the coming environment will destroy that argument, both because it will consist mostly of intellectual work for which you cannot even talk about scale and because we will finally realize that EoS has been mostly bullshit for a long time. The recent megabanks merged in the last decade because of EoS and are mostly dead or walking zombies today: did you accept their arguments about scale? I certainly think Microsoft and Intel using their tech standards and IP law to gain their monopolies qualifies as conniving and predatory business tactics. Giant oil companies that make shady deals with corrupt, third-world oil fields are even worse. However, I would posit two main reasons for the existence of large corporations today: one is the bullshit argument of EoS that has often convinced investors to let companies unnecessarily merge and get a lot bigger than they should have. The other is that there are a few isolated markets, like local newspapers, where it is possible to extract monopoly rents if one can kill off the competition. While there are very few markets like this, many investors get greedy and think their company can also be turned into a Microsoft, so they sign off on idiotic mergers. My basic claim is that these dumb arguments led to a lot more consolidation than there should have been and that the new online environment we're creating will be even more inhospitable to large companies, by dropping search costs to almost nothing for example.

Open source is not really an example of bazaar business because the purveyors are mostly economically illiterate. I only said that the working methods of open source would become widespread, I didn't hold them up as an exemplar of some new business model. Although, I do think it can be used for a better business model if they get the licensing right, as I've detailed elsewhere: http://hybrid.jaggeri.com What I'd use as an example of bazaar business instead is all the tiny software companies and ISPs that one can find online. For as much business and attention as the giants like Microsoft or Google attract, the software/online market is highly fragmented, with thousands of Operas and Godaddy's out there. That's the future, not the dumb consolidation we've sometimes seen in the past.

cm

May 28, 2009 03:46 AM

Ajay, I have not been bashing large companies, nor have I claimed magic. I remember one piece of email humor with an alleged quote of some executive: "teamwork is when a large number of people do what I say". There are some things that require a large and relatively-stable group of people to "execute" the life cycle of large products or projects, and those will always require large organizations. And some such things require deep specialized knowledge, even thought they look extremely mundane at the surface. Not everybody in the organization will require the deep knowledge as there are always generic ancillary tasks and job functions, but there has to be some critical mass of stable expertise.

Incidentally, this type of work doesn't shine a lot and doesn't get a lot of cool press. That's understandable, as these day the idea of cool jobs has moved to different "paradigms".

Ajay

May 28, 2009 04:34 AM

Really? Cuz I thought your statement that "most business activity is driven top down and controlled by layers of middlemen whose major goal is to establish or maintain themselves as chokepoints, i.e. 'corner the market'" was aimed at large orgs, among other such statements you've made. The magic is that you posit big loads but do not name a single example. A stable team does not imply a large organization: most open source projects have the same core contributors for any particular span of a year or two. The difference between this project-based online model and existing companies is how easy it is for an outsider to step in and contribute, online entry is easy as I mentioned earlier. I can always write a new kernel scheduler for FreeBSD and offer to merge it, not so with Apple or Microsoft. Nobody's arguing against relatively stable teams or deep expertise, only against your unsupported claim that a large organization is the best home for those. I agree that chip or OS designers don't get a lot of press, but that's because it's proven harder and riskier to build an online service that people want to use and that makes money, than it is to build an incrementally better OS or CPU.

cm

May 28, 2009 12:25 PM

Ajay, I'm running out of new stuff to say. As somebody remarked (Eric Raymond?) in response to a complaint to the effect that open source developers don't produce "real world applications" or "industry grade" software (whether true or not), "free" software authors make their contributions primarily based on how far their interest and needs carry them, and that in order to get them to do things that are not of their (or their "community's") immediate interest or requirement, one has to pay them.

Much of business is precisely about that, getting paid to do work that is (certainly after a while) not particularly interesting or exciting, and which one would rather not do on one's own. Not just in tech, but everywhere.

You may write a kernel scheduler, but you may not necessarily want to do industrial support or custom tweaks on it for corporate users, or you may not want to write software to control a manufacturing line or banking transactions in a "real time" (subject matter wise as well as work wise) environment with diverse and quirky legacy systems and arcane legacy rules of how things have to be done, and where you can't pick and choose the newest libraries and tools. Or how about programming the yearly changes for Turbo Tax like software?

Yet there are legions of people paid to do just that, not always in large organizations.

Maybe part of the miscommunication (?) is that we haven't defined what "large" means. For my purpose here that starts with about 100+ product people working on the same set of related things. I'm not talking exclusively about large MNCs with 5 or 6 digit numbers of employees. (Which usually don't all work on the same thing, but a few 100/1000 different things, or have large scale regional service organizations.)

If that's not good enough for you without a laundry list of specific examples, I'm sorry.

Ajay

May 28, 2009 12:54 PM

What is your point: there exist people who get paid to do work and they work in small and large organizations? What does this statement of the obvious have to do with anything? Large can obviously refer to various sizes but I've given a specific example of a single fab versus a collection of fabs. You continue to refuse to give a single example of large loads that require a large rig, meaning a large corporation because you claim a collection of small teams won't do, which is fine because that position is indefensible anyway.

prof

June 24, 2009 10:17 PM

FedUp, thanks for that post mister. You are getting a lot of shade from folks here, but there is some juicy information in what you posted. One sided to be sure, but a very good summary of that one side. Thanks.

Thank you for your interest. This blog is no longer active.

 

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