IBM 'pulls out of US'

^^^ re:

You know that the Indian press will cover that story. I take for example of when a major auto maker wants to make a factory in your local area, it's always in the local news of where you live, whereas it may not be elsewhere in your Country. Jobs is what it brings & to a certain extent, may at least appear to give your area a little more clout or bragging rights if you know what I mean.

I'm in the southeastern part of the States, namely in Atlanta. Many companies move from states up north down here to where the tax rates are lower for their businesses. And by times, many of it's employees will love down here with the company. The state I happen to live in, Georgia, is #5 on the top states for businesses to succeed in according to Forbes magazine. On this list, anyone with any amount of business knowledge knows that all of the states within the lower half have high tax rates, not only for companies, but also for it's citizens.

You are 100% correct when you state that the operating cost for companies is cheaper when shipped out of the Country, so when this happens, I exercise my choice in not to do any business with them.

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You know that the Indian press will cover that story

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Wrong there.. Indian news media covers everything but news.. And I'm not joking :|

Guys did anyone watch spec's video link?

Two things
Labor costs
Unions

I **** you not. It is cheaper to chop down a **** load of trees in Washington state; Ship them to China where they are sliced and diced into whatever, then shipped to a factory in Michigan for final product assembly.

Union transportation costs across states;Washington to Michigan, is more than the boat ride to China.

Processing the trees in the states costs almost twice the cost of boat ride back. So labor costs on processing the wood are almost null.

The reason the the southern states have a higher success rate is they are right to work states. Michigan you MUST be in a union to work. So you can make $24 per hour without knowing how to read or write.

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Originally Posted by dinowuff

Guys did anyone watch spec's video link?

Two things
Labor costs
Unions

I **** you not. It is cheaper to chop down a **** load of trees in Washington state; Ship them to China where they are sliced and diced into whatever, then shipped to a factory in Michigan for final product assembly.

Union transportation costs across states;Washington to Michigan, is more than the boat ride to China.

Processing the trees in the states costs almost twice the cost of boat ride back. So labor costs on processing the wood are almost null.

The reason the the southern states have a higher success rate is they are right to work states. Michigan you MUST be in a union to work. So you can make $24 per hour without knowing how to read or write.

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yes another contributing factor in this is the unions.

When you mentioned southern states, that is not the whole truth to the matter. Virginia is #1 yet again, but this list varies. http://www.forbes.com/2008/07/30/vir...eststates.html
Utah is #2 and North Carolina #4.

Michigan & progressive states such as Massachusetts, New York and California did not fair too well.

High taxes + big labor = not good for business anywhere. Since you mentioned Michigan, I meet lots of people from there & places like New York that move here because of the lack of jobs. Michigan's local economy has been way down for a while now. I hope you guys get better up there.

Well, I wouldn't be in too much of a hurry to blame the unions, certainly not in the UK.

I look on it as "restrictive trade practices" which actually come from labour, employers and the government!

For example:

1. Labour. Typically the "closed shop" which is mandatory union membership; and "demarcation lines" where only certain workers (read union members) are allowed to do certain jobs.

2. Employers. They have cartels and quangos which basically set artificial price levels. This leads them to inefficiency, and their only remedy when things go wrong is to lay off workers.

3. Government..........they actually play a large part in it, particularly as we have EU regulations as well as our own. Factors would be:

(a) We have a minimum wage which is currently £5.73 [$8.18] per hour
(b) The maximum number of hours (on average) you are supposed to work a week is 48.
(c) The minimum paid holidays is 4 weeks/year plus national holidays. That means the EU averages 6 weeks per year.
(d) Statutory sick pay which the employer has to pay for several days and contribute to for 6 months or more depending on length of employment.
(d) Equal pay regulations. Employers are basically forced to pay the same for the same job.
(e) Employment tax. The employer has to pay a percentage of a worker's compensation up to a certain threshold.
(f) Certification. You seem to need an official certificate to wipe your a$$ around here these days. It increases labour costs no matter who pays for it, as the government certainly don't.
(g) Statutory redundancy compensation, which can be quite high, and still leave the employer with a pension liability.
(h) Job security regulations..........your employer can't change your terms and conditions without your consent. He would have to pay redundancy and possibly unfair dismissal compensation.

That leaves us with different economic environments, which is basically "cost of living".

In the UK the minimum wage is £230/week and the average around £470/week [$325/$670). I would expect that in cheaper countries people would be happy with a half of that?

Hell, even if you gave them similar benefits, I would expect the cost to be pretty much proportionate to the local compensation rate?

I can see the same sort of thing over here, so I imagine it must be far more obvious in the US? For me to maintain the same standard of living in London as I do here I would need around $20,000 a year more after tax and deductions.

EDIT:

Hey,

ByTeWrangler

I just heard that IBM had just laid off 700 Indian workers, and that these were new intake graduates/interns. That makes me even more suspicious that it was a political move by them.

It doesn't look good when you take on a crowd of kids from college and promise them a career with a major player, then let them go a few months later.

I bet they deliberately leaked the story to the Indian media, as it appears to promise that more jobs will be coming but they will be more senior and better paid. :cool:

It is fairly standard practice in a recession to lose temporary, part-time and trainee staff and consolidate with more experienced people.

Nihil good post. You are well versed on translating the pound into U.S. currency. I have no base knowledge on the currency there. Nihil>jamz

I got to get in these forums more often. I joined several years back but never really took the time to come here often enough. Before the other day, it was since the summer of '07 since I had last visited here. This site is too good to ignore.


Later & cheers!