Misplaced Tears Over Outsourcing

An acquaintance linked to this article about outsourced call centers in India, and since that’s a topic I know a certain amount about from a while back, I had to look despite the fact it’s at Mother Jones — not exactly one of my usual sources of news.

In facts, the article pretty well reflects the way things are, from what I know of the industry (more of that in a bit), but the editorial angle of the piece is so at odds, at times, with its content that the contrast become dizzying (unless you behave as Mother Jones perhaps expects their readers to and simply agrees to be outraged by whatever the author chooses to be outraged by.) For instance, read this section:

Every month, thousands of Indians leave their Himalayan tribes and coastal fishing towns to seek work in business process outsourcing, which includes customer service, sales, and anything else foreign corporations hire Indians to do. The competition is fierce. No one keeps a reliable count, but each year there are possibly millions of applicants vying for BPO positions. A good many of them are bright recent college grads, but their knowledge of econometrics and Soviet history won’t help them in interviews. Instead, they pore over flashcards and accent tapes, intoning the shibboleths of English pronunciation—”wherever” and “pleasure” and “socialization”—that recruiters use to distinguish the employable candidates from those still suffering from MTI, or “mother tongue influence.”

In the end, most of the applicants will fail and return home deeper in debt. The lucky ones will secure Spartan lodgings and spend their nights (thanks to time differences) in air-conditioned white-collar sweatshops. They will earn as much as 20,000 rupees per month—around $2 per hour, or $5,000 per year if they last that long, which most will not.

Is there any greater cruelty than capitalism? Aren’t you shocked by what companies are forcing these Indians to do? Why do they put up with this abuse. Oh wait, the next sentence says:

In a country where per-capita income is about $900 per year, a BPO salary qualifies as middle-class.

Maybe this explains why people flock in from all over the country to these business hubs in order to try for one of these graveyard shift “sweatshop” jobs: Instead of appearing in picturesque native garb while working outside in “Himalayan tribes and coastal fishing towns” they can slip on their business casual clothes, head to an air conditioned office, and make 5.5x the per capital wage of the country. This would be the equivalent of making $240,000/yr in the US. Will Mother Jones be publishing a heart-wrenching account next month of how young midwesterners are passing up the chance to work on picturesque farms and auto parts factories to come to New York and sell stocks for Goldman Sachs for a quarter million a year?

Or how about this clear sign of worker exploitation: They hold new worker’s wages for the first two months:

After an hour of waiting, our trainer entered. Lekha was tall and rail thin, with big doll eyes. Her accent was what BPO higher-ups would call “perfectly neutral”—her vowels soft and long, her Rs a benign compromise between flipped and rolled. “Training takes three weeks,” she told us. “It’s combined accent and culture training; we’ll assume that you come to us with the accent part pretty well taken care of.” In a playfully arch tone, she rattled off the rules: no mobile phones, eating, or drinking. And she would charge us a rupee, she teased, for every non-English word she heard in the classroom. “Any questions so far?”

“When do we get paid?” asked a young man wearing a Nike cap, yellow-tinted sunglasses, and carefully crafted facial stubble. In New York, I would have pegged him as a party promoter from Long Island City.

“Very funny,” Lekha said. “You’ll be paid for your time, including this training, but only after you’ve stayed two months. You know the drill: We wouldn’t want people taking off as soon as training is over.”

Except, it turns out that this is pretty well justified by worker behavior:

During our first cigarette break, Mr. Long Island City revealed that, indeed, his plan was to do precisely that—he’d already gone through this routine at some 15 BPOs around Delhi. “Who needs to stay for the actual work? Plus,” he added, flashing a salacious smile, “that way you meet more girls.”

Okay, think about this one for a moment: It’s not just that some of the employees are unreliable like this fellow and like hopping from one job to another — it’s that well qualified call center workers are in demand enough that companies can’t get away with refusing to hire people who are chronic job-hoppers. Surprisingly for a case of low-wage outsourcing, the power is actually resting with workers here, not employers.

Alright, one more snippet, this one a little longer:

Today, almost half of BPO employees are women, many of whom outearn both of their parents. Free-market cheerleaders, conflating rising wages with rising spirits, are quick to applaud India’s “maturing” markets. But the truth is more complicated: Studies show that once people move out of poverty, increasing wealth does not necessarily lead to happiness.

Call-center employees gain their financial independence at the risk of an identity crisis. A BPO salary is contingent on the worker’s ability to de-Indianize: to adopt a Western name and accent and, to some extent, attitude. Aping Western culture has long been fashionable; in the call-center classroom, it’s company policy. Agents know that their jobs only exist because of the low value the world market ascribes to Indian labor. The more they embrace the logic of global capitalism, the more they must confront the notion that they are worth less.

Growing up in Kolkata, Arjuna never got along with his parents. “In America, you guys move away from your family after high school or college,” he said, “but not here.” His family expected him to stay at home, work at the bank where his father worked, and marry his high school sweetheart. Instead, he shocked everyone by moving to Delhi. BPOs aligned with his individualist streak; culture training taught him about societies where young people lived as they pleased. He impressed coworkers with his American accent, and when he got his first paycheck, he tasted the liberating power of disposable income.

Soon, though, his hobbies began to feel hollow. He had lost touch with his family and made few friends. His high school sweetheart stayed in Kolkata and met another guy, but Arjuna had not found a girlfriend in Delhi.

In a long Facebook chat, he told me he was still stuck in the same customer-support job, still verging on depression, and still single. He never could figure out how to date casually, as Americans do; nor could he bring himself to use the matrimonial websites popular in India. “To me, arranged marriage is a joke,” he said.

In a sense, Arjuna is too westernized to be happy in India. He speaks with an American accent, listens to American rock music, and suffers from American-style malaise. In his more candid moments, he admits that life would have been easier if he had hewn to the traditional Indian path. “I spent my youth searching for the real me,” he says. “Sometimes I feel that now I’ve destroyed anything that is the real me, that I am floating somewhere in between.”

Alright, let’s try to parse through this for a moment. Working for call centers that take “outsourced” work from the US allows these college educated Indian young people to make 5x the national average, it gives equal opportunities to women in what has traditionally been a highly patriarchal society, and it allows people greater independence in a culture which has traditionally practiced arranged marriage. Yet, the Mother Jones author feels that this is probably mostly bad because… Well, he’s not really sure why, but it’s caused by Westerners and corporations, so it must be bad, right?

Look, as a conservative the last thing I want to do is suggest that abandoning traditional ways of doing things is without negative consequences, and there are real tensions created as people move from a more traditional society to a more modern one and figure out how to use newfound independence and wealth without destroying themselves and their social structures. (As Shikha Dalmia discusses in this brief clip, this one of the main sources of dramatic conflict in Bollywood movies.)

But the desire of the author to see all of this as somehow victimizing Indian workers and wrenching them away from their traditional occupations almost gives one the impression that he thinks Indians are best off as poor but picturesque workers in the fields — or perhaps more fairly that he would like picturesque National Geographic occupations to somehow result in a US middle class lifestyle.

As I said at the beginning, I was drawn to the subject matter because I actually dealt with call center outsourcing quite a bit at one point. Eight years ago, new to Texas, I landed a job at one of the local tech giants and the first thing I was assigned to do was to audit tech support and customer service calls being taken by their offshore call centers — mostly in India. Our team spent probably six hours a day listening to calls and recording our ratings of them, and the rest of the day writing up analysis on how different call centers were doing and talking with managers in those call centers about how they could do better. All of us on the team were people who’d done at least a little bit of call center work ourselves in the US, and during the year we worked on the project we got to know our Indian counterparts pretty well.

Some things talked about here I can attest to. The competition for these jobs is intense — mainly because they pay so very well by Indian standards. People also sometimes work fairly long hours. (Indeed, we were always trying to get the people we worked with to stop working overtime out of a misplaced desire to deal with all our requests or suggestions immediately rather than the next day.)

What the article doesn’t talk much about (or glosses over with seemingly unknowing references) is the level of pride that a lot of these call center workers have (at least, the one’s fielding tech company tech and customer support calls — probably a cut above people doing bill collection or selling vitamins) both in their work and in how far they’ve come in a short period of time. The ones who are good at what they do (which contra the article is not just a matter of having a good speaking voice, but of being sympathetic, understanding people’s problems quickly, and going out of one’s way to solve the customer’s problems) have a lot of chances for promotion or switching companies. At least at that time, American Express was known for having some of the most skilled and best paid call centers in Bangalore, and we were constantly losing good customer service agents to them.

As with anything, the effects of these kind of global changes are mixed. But portraying the world of Business Process Outsourcing as some sort of cruelty inflicted upon India by evil Corporate America requires ignores the real experiences of the people I got to know while I was working with Indian call centers.

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  1. Great article, Darwin. While I do appreciate that lost American jobs generate real hardships, the case for protectionism always seems to boil down to some embarrassing rationalization about why we really shouldn’t care about fellow human beings in genuine poverty — not the ersatz US version.

  2. The USA is Bankrupt(15 Trillion dollar debt fast aproaching) as are many large cities. Sending USA jobs be they industrial or internet type jobs over seas is economic Suicide. Destroy the USA middle class and a European meltdown ecomony wise is imevitable in the uSa cities and federal government.. We were told that Free trade would end indusrrial jobs but create high tech-internet jobs. Free trade -outsourcing was supposed to eliminate illegal immigration from third world countries. We had 3-4 million lillegal aliens given amnesty by the Reagan administration. Now there are 12-20 million illegal aliens here. Outsourcing is Treason which is why Red China gave money to Reagan and Clinton so much money after both left office and sent USA jobs out to Red China one of the most anti Christian, Bhuddist, Muslim and Vallagong persecution police states in the world.USA companies should be penalized not rewarded for shafting the USA middle class by outsourcing to India , Red China, Mexico etc..This is why cities like Waterbury Ct. USA has high property-small buisness taxes to make up for lost revenue when USA companies run to China , India etc..

  3. Mike Petrik, same for the case for “buying local” which annoys me to no end. The same people who want to give every possible advantage to poor illegal immigrants in the US, would rather enrich a well-off upstate-NY farmer than a poor Latin American laborer. They retort that the money is actually going to rich multi-national corporations, which goes back to DC’s point. Would they rather the evil corporations not provide the jobs?

  4. Forgive me for pointing it out but the suggestion that we have more responsibility to employ the desperately poor in India than our fellow citizens is rubbish. The man losing his home in Altoona, PA is every bit as entitled to my support as any refugee family in Sudan and there is absolutely nothing wrong – morally or rationally – with buying from my countrymen rather than from abroad.

  5. Forgive me for pointing it out but the suggestion that we have more responsibility to employ the desperately poor in India than our fellow citizens is rubbish. The man losing his home in Altoona, PA is every bit as entitled to my support as any refugee family in Sudan and there is absolutely nothing wrong – morally or rationally – with buying from my countrymen rather than from abroad.

    I wouldn’t say that there’s anything wrong with buying from other Americans rather from abroad, I think what’s being objected to is that it’s wrong to buy from abroad rather than Americans because of some idea that Americans are fundamentally more entitled to be supported by our purchases than foreigners.

    I think two others things might be somewhat at play here, at least in some people’s minds:

    1) People often feel that the first step is the most important. As such, some might feel that it is a greater overall improvement for someone in India to land a job which makes him $5000/yr rather than subsisting at $900/yr than it is to help someone in the US who is getting $14,000/yr in public assistance to make $16,000. From a development point of view, there are different ways to look at this, but I wouldn’t necessarily disagree with someone who feels that we should want to see people in far less fortunate parts of the world brought up to the US standard before we worry about certain US income and inequality issues. (On the other hands, there’s a good argument that the most local problems are the ones we have the most ability to deal with.)

    2) While this is by no means a moral argument, I think people may feel a lot more kinship with hard working people in developing countries who are making it into their country’s middle class by working for international firms than they do with many economically disadvantaged people — they may feel that they are more deserving poor. For instance, the call center experience that I had had which led to my being given this auditing job was managing a group of outbound fundraising callers at a call center in Wellsburg, West Virginia while I was in college. Potential hires at that American call center had a high school degree or were drop outs and many had trouble reading well enough to get through the three page script (pitch plus rebuttals). We had routine problems with drug abuse and absenteeism, and a lot of the workers there had kids out of wedlock and blew a lot of their salaries of drugs and/or alcohol. By comparison the Indian call center workers that I dealt with (making $3/hr compared to the US workers making $9/hr) were college educated and incredibly hard and conscientious workers. Rightly or wrongly, I very much tended to feel that they “deserved” success a lot more than many of the American call center workers that I’d dealt with, so I didn’t tend to feel bad about the fact that their jobs were over there rather than over here. This certainly isn’t to say that people in the US who are unemployed deserve it — some good friends who are hard workers have been chronically unemployed or underemployed over the last few years — but I do think it’s often the case for those who have dealt with the folks who are making a few dollars an hour overseas doing “outsourced” jobs that it often seems like those people are among the “deserving poor” while some in the US seem less so.

  6. I understand the frustration that many feel about this topic, but the reality is that a country must transition jobs quickly in such a competitive world, or face the reality of being on the side line. If American companies don’t take advantage of the less expensive labor now available in other countries, non-American companies will and there will be no American jobs at all, because the companies will cease to exist from not being competitive enough to survive. Unfortunately that leaves those who can not transition job fields easily somewhat in the lurch, but that is the reality of a shift to a global economy. It is best to embrace it rather than fight it, it is now the norm.

    Great article about the actual benefits, which is largely ignored when people focus on the negative results of overseas jobs.

  7. great article and awesome title…yeah these all facts are very true…Outsourcing has become the mantra of success for professionals throughout the world. Over the past few years, the business and corporate sector has undergone drastic change. This change is largely due to the expansion and growth of freelance services. The mighty impact of freelancing has forced companies of all sizes and shapes to outsource their services to offshore countries.

  8. To expand some on DC’s points,

    1. It’s hard for me to build up a desire to aid those who aren’t that much worse off than I am.

    2. I don’t feel a strong sense of kinship with anyone outside my social circles. Because of the diversity of America, I may have more in common with a foreigner than a random American.

    I don’t think it’s immoral or irrational to prefer those around you but I hate the self-congratulating that the anti-free-trade “buy local” types engage in as if they made the morally superior choice.

  9. I appreciate the clarification.

    There is a disconnect between the perceived and actual benefits of global trade though.

    For all of it’s cost savings to the consumer, goods that cost less are often not cheeper since they may be of poorer quality and their mass-production by a remote producer makes redress inconvenient. (The remoteness of production breaks the feedback from consumers that drives innovation and quality.). So too, the lax environmental controls oversees surely have a generalized but not cost captured impact on all of us. (While Pennsylvania streams may be cleaner for the movement of steel production to China, the non-existent regulations there destroy our air as much as theirs.)

    From a justice point of view, buying products made by children, that destroy rain forests, that enrich oppressive regimes, and that encourage the abuse of the poor by global companies with no more interest in local people’s than the use of their land and labor is, at best, morally neutral and, under the right circumstances, sinful.

    Buying local modifies the calculus in the consumer’s favor.

  10. For all of it’s cost savings to the consumer, goods that cost less are often not cheeper since they may be of poorer quality and their mass-production by a remote producer makes redress inconvenient. (The remoteness of production breaks the feedback from consumers that drives innovation and quality.)

    I think this is a valid point, and one that people do well to keep in mind. At the same time, sometimes cheap is all that will do for those who simply don’t have much money. In a lot of cases, people don’t have a choice between buying a cheap product and buying an expensive one — they have a choice between buying a cheap version or not affording anything. As such, the benefits of cheap overseas labor are particularly noticeable for the less-well-off. (Whereas those with money could afford to buy things either way, and often end up buying products made by higher-paid American or European workers anyway for reasons of quality.)

    From a justice point of view, buying products made by children, that destroy rain forests, that enrich oppressive regimes, and that encourage the abuse of the poor by global companies with no more interest in local people’s than the use of their land and labor is, at best, morally neutral and, under the right circumstances, sinful.

    However, not every foreign worker is a enslaved child being beaten by secret police with staves cut from the rain forest while pollution billows across the landscape — sometimes they’re just hard working people who look different from you and me who want jobs so they can provide for their families.

    It is wrong to assume that conditions are always great in overseas work, and that our purchasing dollars never go to prop up abuse and corruption, and to the extent possible we should seek to combat that wherever possible. At the same time, I find it disheartening when the response people have to this is a sort of righteous nativism where it is insisted that since we don’t know that every person in Indonesia or Vietnam is treated well, we should refuse to have anything to do with them.

  11. That is fair DC.

    The sinfulness turns, at least in meaningful part, on the knowledge one has of the circumstances. Buying stock in a company that one knows to be abusive must be sinful. Buying into a market account that holds such stock is certainly less so.

    Nativism isn’t always a bad reflex though. Natural concern for the welfare of those that one is directly connected to by geography has a certain self-preservation to it that is surely not morally questionable. It seems to me that buying gas from the convenience store that employs people in my town is preferable to buying gas from the Turnpike rest stop fifty miles away. Buying chairs made in my county is better than buying cheaper chairs at Wallmart if I can afford it. Buying lumber cut from US forests is better than buying lumber cut abroad too.

    As the circles get wider, my concern for and responsibility to diminishes. That is the practical reality and there is undeniably an unsavory aspect to it when one applies Christian principles of brotherhood and neighborliness. Like it or not though, it is natural to want to interact more with and aid more readily those whose health and welfare directly affect our own.

  12. I have not read the article, as it appears to be the usual 2c but I can tell you as an Indian, that the image of thousands embarking on a trek from the Himalayas to the Gangetic plain in the manner of Boers looking for the promised land is absurd. Most of these jobs are located in South India, in Bangalore and Madras where they have an advantage in that the locals have a facility in English. Do not be fooled by the pathos, the field is as cutthroat as any in India. Rampant globalisation as practised by the multinationals and their cronies benefits only a few, as the elements of the hoi polloi who are recovering from the drug of consumerism have understood for some time now.

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