NYT: Financial Firms Hasten Their Move to Outsourcing

[DeepModem Mom]

Financial Firms Hasten Their Move to Outsourcing

By SARITHA RAI
Published: August 18, 2004


....seemingly a myriad of financial institutions including banks, mutual funds, insurance companies, investment firms and credit-card companies are sending work to overseas locations, at a scorching speed.

From 2003 to 2004, Deloitte Research found in a survey of 43 financial institutions in 7 countries, including 13 of the top 25 by market capitalization, financial institutions in North America and Europe increased jobs offshore to an average of 1,500 each from an average of 300. The Deloitte study said that about 80 percent of this went to India.

Deloitte said the unexpectedly rapid growth rate for offshore outsourcing showed no signs of abating, despite negative publicity about job losses. Although information technology remains the dominant service, financial firms are expanding into other areas like insurance claims processing, mortgage applications, equity research and accounting....

***

In a recent report "Offshoring, A Detour Along the Automation Highway," Mr. Haney estimated that potentially 2.3 million American jobs in the banking and securities industries could be lost to outsourcing abroad.

Girish S. Paranjpe, president for financial solutions at Wipro, a large outsourcing company in India, said, "Pent-up demand, recent regulatory changes and technology upgrade requirements are all making global financial institutions increase their outsourcing budgets." His company's customers include J. P. Morgan Chase, for which it is building systems for measuring operational risk, and Aviva and Prudential, the British insurers....


http://www.nytimes.com/2004/08/18/business/worldbusiness/18india.html

[cleofus1]

1. from what i understand....

The real bad thing is not losing these jobs. The horrible thing about this economy is that we are not creating new high paying jobs at a higher rate than we are losing them....

[Ruffhowse]

3. Any new high paying jobs would be just as vulnerable to offshoring as...

existing jobs. This is a process that is just snowballing at an alarming rate, absorbing all in its path. It's time to be afraid, very afraid. Jobs you never thought could be offshored are being looked at right now by the extremely aggressive offshoring firms. Don't think it couldn't happen to you. This won't change until we get leadership in Washington that cares more for the average worker and less for the "investment class" and corporate America's bottom line. I am not optimistic.

[tedzbear]

2. The writing's on the wall...

The USA is turning into a third world country with a huge military but little else. Our corporations no longer pledge allegiance to the US but are globalized instead. Most don't even pay income tax to the US!

[Skittles]

4. all the assholes quoted in this article

none of them care that we Americans CANNOT COMPETE WITH PEOPLE WHO HAVE SUCH A LOWER STANDARD OF LIVING. I would gladly accept a third of my pay IF I COULD FREAKING LIVE ON IT.

[NeoConsSuck]

5. Excellent point.

I truly believe the US military exists for one purpose only. As a protector and enforcer of capitalism and the free market system. You either let the corporations play their free market games, or we invade and disrupt. Hussein, Castro or Chavez saw what happens when you don't let corporations rule your country.

It's governement for and by corporations, the people are only there to foot the bill.

And the US military is there to protect and promote any corporation, whether that corporation is domestic or international.

I was reading an article that said other countries are happy to let America be the world's policeman/enforcer, since they can then use their tax revenues on social agendas like health care instead of military spending.

Americans get what they deserve.

[Veggie Meathead]

6. The high paying jobs that we seemed to take for granted if we

had the right qualifications are going to be a thing of the past.India and China have formidable talent being generated in the millions at their many fine universities.These graduates will work for a fraction of what we make.Because of satellite communications and computers they might as well be living next door,except they can live very well in India for $2000 a year.Try doing that anywhere in this country!.

I think we must have laws that do not allow unrestrained offshoring
without some penalties.Even if such laws are passed, it may be too little too late given the speed with which the process is taking place.

[Florida_Geek]

7. This could be read as very GOOD news

Maybe just maybe these firms see the handwriting on the wall and know President Kerry will try to stop all this outsourcing... so the time to do it is now.....

[tlcandie]

8. What I want to know is exactly what will Americans be doing down

the road without jobs? There are only a FEW richies while the majority are below them.

Are we talking sweatshop sewing factories and such throughout America? Another revolution errrr devolution of some kind. I just can't picture what we will be doing with our collective selves once all these jobs are gone.

Most of the farming land is gone. Most everyone is in debt up to their eyeballs. The government owns or controls everything.

[moondust]

9. And it's not just the loss of income and benefits.

It's the loss of skills and the loss of opportunities to use and further develop those skills.

And the loss of tax revenues.

They are creating the next Great Depression in the U.S.

[NeoConsSuck]

10. And why would a corporation care about that?

and since our government is subservient to corporations, why would the government even care?

[rfkrocks]

11. as springsteen said in "Youngstown"

"we made you rich enough to forget our names"
the social contract of this society is cracking-there should be major alarm bells everywhere-still the US public sleeps-how can there be so great a divide over voting when it is so obviuos that every thing shrub does is puttin the US in intensive care.
I agree with all the above posts-we are getting to be a third world country with a large military-the caste society is upon us and we need reform as soon as possible! Kerry/Edwards is a must.

[demon67]

12. Do these figures include

outsourcing jobs from Wall Street to Jersey City? Just wondering.

[DeepModem Mom]

13. I believe the article is limited to foreign outsourcing -- nt