Offshoring and Lowered Expectations

Computerworld - One of the best things about living and working in Silicon Valley is the quality of the people. I'm frequently the least-knowledgeable person in the
room, and probably the stupidest. I get to learn from the ultrasmart and creative folks I meet.
So why do I have an uneasy feeling these days about the place, even as an economic recovery for the technology industry starts to gather steam?
One factor abounds with irony. A few years ago, I wondered if the Valley was sowing the seeds of its demise by creating the communications and collaboration tools that would make it much less necessary to be there in a physical sense. The near-unanimous consensus at the time among the top people in the field was that the Valley had nothing to worry about.
I never entirely bought their faith, though the Valley has repeatedly shown an ability to rebound to new heights after deep economic downturns. The recent evidence, notably the surge of offshoring, makes me ask again -- about the Valley and the entire nation.
And I wonder if something is genuinely different now.
Intel CEO Craig Barrett put his finger on it a few weeks ago when he stopped by my newspaper for a long chat with some reporters and editors. What's new this time, he told us in a persuasive way, is the nature of the global workforce.
For the first time in human history, Barrett said, a truly gigantic pool of well-educated, technically adept and eager-to-please labor is being created. This pool of talent, which will include hundreds of millions of people in China and India (many of whom speak English fluently), has another characteristic: a willingness to work for a fraction of what Americans expect.
This is not because they like living poorly. It's because local conditions and currency exchange rates make what would seem like a pauper's salary here a highly attractive one there.
The U.S. largely came to grips with a similar crisis in low-end manufacturing. We moved up the value chain as a society, painful as this was for the less-educated, hardworking people who lost middle-class jobs and had to settle for lower-paid service employment.
How high can we move on the value chain now?
I travel widely. One thing I know for sure is that Silicon Valley and the U.S. have no monopoly on brains or energy. We do have an advantage in promoting a culture of risk, of entrepreneurialism. But other places are beginning to adopt even that value, too.
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