Just read a special issue of Electronic Design where a lot of attention is given to the issue of outsourcing.

Ten pages of the usual moans of how the country is deteriorating because of outsourcing, how young people just don’t know anything and how all engineering / r&d will be done in China Russia and India in 10 years.

But in the same issue, a salary survey makes me gasp. Average base salary: $84K, total (with bonuses/options): $92K.

I can’t help but wonder. Given that the price of living here (in Israel) and in the US is about the same, and that engineers get around $50K here on average and that’s considered a VERY GOOD SALARY, how can Americans wonder that so much outsourcing is going on ? Those salaries are outraging - and get this, 40% are not content and think that they deserve more !

This goes against the basic principles of economy, dear American engineers. How can you expect producing the same as Xi Ji Yang Li and making 4 times as much ?

The economic explanation of this phenomenon eludes me. Why do the wages stay so high ? Isn’t it more reasonable for the wages to go down, together with the outsourcing. It’s clear that the rate of outsourcing is very closely related to the average wage. If the average wages are $60K, there will definitely be much less outsourcing.

Related posts:

1. outsourcing is good - a thought experiment

This entry was posted on Sunday, March 13th, 2005 at 3:47 pm and is filed under Miscellanea. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.