So with that said, here is my opinion for the week:

When the low level jobs for “low” pay get outsourced, the next level of jobs pay rates drop to fill the pay rates of those that are now outsourced. This pattern will eventually push the next level of jobs to be outsourced, and so on, and so on.

Now let’s get to the numbers.

Let’s assume we have five levels of workers all in the USA. (this is a very simplified example)

• Group A is entry-level and makes $20 per hour
• Group B is senior entry-level and makes $30 per hour
• Group C is intermediate level and makes $50 per hour
• Group D is expert-level and makes $80 per hour
• Group E is master-level and makes $100 per hour

Now, we outsource Group A positions to India for $6 per hour. Firms are now paying the following:

• Group A - $6 per hour (India)
• Group B - $30 per hour
• Group C - $50 per hour
• Group D - $80 per hour
• Group E - $100 per hour

Now, many of the Group A workers are fired from their jobs. These Group A workers will try to get positions in Group A type jobs, but some may apply for Group B jobs. When Group A worker applies for Group B job, they will request by default a lower wage. So over time, the wages now shake up like this:

• Group A - $6 per hour (India)
• Group B - $20 per hour
• Group C - $50 per hour
• Group D - $80 per hour
• Group E - $100 per hour

And the pattern continues. Group B workers are now replaced with well-qualified (and that is the key) Group A workers and slowly push out Group B workers from the Group B jobs due to the wage difference. After some time has passed, the chart looks like this:

• Group A - $6 per hour (India)
• Group B - $20 per hour
• Group C - $30 per hour
• Group D - $50 per hour
• Group E - $75 per hour

Of course, this example does not reflect that all Groups will be outsourced to India at some point thanks to corporate greed. So in my example, each group’s wage drops by 20% or more over time. I have seen this happen with HTML coding, general programming, network professionals, tech support, etc. Why has this model taken place in the IT field but not in other professional fields such as Marketing, Finance or Legal?

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