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JOB DESTRUCTION NEWSLETTER
by Rob Sanchez
June 04, 2004 - No. 1026

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The Forbes article below (on the MSNBC website) is one of the stupidest
articles I have seen in a long time - and that's quite an
accomplishment! They list 10 jobs that aren't likely to be outsourced.
The reason their list is so stupid is that every single one on the list
is being insourced with H-1Bs and L-1s. You can check that out yourself
by using the LCA database.

They also have a slide show of the jobs that are safe for outsourcing
that looks like something made for high school kids. Watch it for a few
laughs! The salaries they quote are a real hoot.

Just in case you see the list and decide to become a highly paid pilot,
don't even think about it! Case in point: Delta Airlines is telling
their pilots that unless they take a 30% pay cut, they will file for
bankruptcy.

Airline pilots are facing a classic "Race to the Bottom" that Alan
Tonelson describes in his book. The race in the airline business works
like this:

1 - An airline such as US Airways or American has financial problems
and demands salary concessions to cut costs. (Rising fuel costs
exacerbate their problems.)

2 - They file for bankruptcy to avoid going out of business.

3 - The courts force all employees, with the exception of the CEOs, to
take major salary cuts. These airlines can offer lower fares than Delta
not only because they knocked down labor costs, but they also can forgo
paying their debts. In addition they can get bailouts from the Federal
Government which they use to undercut Delta. After all of this, the
CEOs celebrate after getting big fat bonuses.

4 - Delta and the other solvent airlines have to lower their fares in
order to compete with the bankrupt carriers, but the fares are so low
they lose money on every passenger.

5 - After enduring billions of dollars of losses, airlines such as
Delta goes to step #1 - and the cycle downward begins all over again.


I recently talked to a Delta pilot and found out that the situation is
much worse than the articles I included below. That's because pilot
salaries are only 15% of the total costs of running the airline. If
pilots take a 30% pay cut, Delta will go bankrupt but it will take a
little longer. If the pilots don't agree to the pay cut, Delta will
declare bankruptcy and then the pilots will be forced to take an even
greater pay cut and the unions will have no power to negotiate.

So far Delta's union is at an impasse with management because the 9%
they agreed to is not enough to appease the beancounters.

Considering all the facts that are easy to find by using Google, the
reporter who wrote this story is either lazy and/or incompetent or was
ordered to write a feel-good propaganda story.


So, what job can you get that is safe from outsourcing? According to
the India Times, "Jobs Requiring Physical Contact" are the ticket to
economic security in the U.S. I thought those jobs have been safe for
thousands of years! (* See note below)

Other than healthcare pros, janitors, gardeners, dentists
are the jobs that will remain in the US . Foreign-born
workers may do them, but they'll have to move to the US.

Here is the really funny part, besides the fact that they listed low
paying jobs like janitors and gardeners. The India Times acknowledges
that these jobs can be taken by workers on guest-worker visas, but they
never admit that the most obvious of all jobs have already been taken
by H-1Bs.

The demand for database administrators is also expected to rise
by three-fifths. Among the top score of occupations that are
expected to see the highest growth, half will need IT skills.
As it is, between 1999 and 2003 (that is, including during the
recession) jobs were created, not lost, in a whole host of
white-collar occupations.


When it comes to articles about job security, the American and Indian
press are a laugh-a-second.

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( O ) ( O )
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>-. / /|
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* Note: Comment was supposed to by funny. My apologies if you didn't
think so. It's my birthday so I think I should be able to say anything
I want to.

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Articles Used for this newsletter:

http://www.msnbc.msn.com/id/5077435/
Airline pilots are one of the ten white-collar professions highly
unlikely to be moved off of American shores, Forbes.com says.

http://washingtontimes.com/upi-breaking/20040604-104812-1480r.htm
Analysts predict Chapter 11 for Delta

http://www.enquirer.com/editions/2004/05/11/biz_biz1delta.html
Delta ponders bankruptcy
Possibility is raised if cuts not made

http://timesofindia.indiatimes.com/articleshow/666989.cms
Jobs that the US will never shift to India

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http://www.msnbc.msn.com/id/5077435/

Airline pilots are one of the ten white-collar professions highly
unlikely to be moved off of American shores, Forbes.com says.

By Lisa Dicarlo

Updated: 3:43 p.m. ET May 27, 2004 Mark Hodges, chief executive of
outsourcing advisory firm Equaterra, has a sobering declaration:

"You're complacent if you think your job is safe from competition. If
you're worried about that you shouldn't live in a capitalist society."

Yikes.

Many white-collar jobs have shifted outside the U.S. in the past
several years, prompting fears that a broad swath of professional jobs
can be outsourced to lower-cost countries. But that is not the case.
There are plenty of high-paying professions whose employment numbers
are expected to grow sharply over the next decade, according to the
U.S. Bureau of Labor Statistics.

Ten jobs not likely to be outsourced

To see the slideshow, click here.
Job

• Chief Executive

• Physician and Surgeon

• Pilot, Co-Pilot and Flight Engineer

• Lawyer

• Computer, Information systems manager

• Sales Manager

• Pharmacist

• Chiropractor

• Physician's Assistant

• Education Administrator

That's not to say that outsourcing will slow. IBM and EMC, to name just
two, plan to add jobs in India and elsewhere. The pressure to cut
costs, coupled with the increase in quality and a skilled labor pool
outside the U.S. will drive the trend. Services companies like
Accenture, which has a large presence in India, will benefit by helping
U.S. companies set up shop there. Similarly, Hewlett-Packard is
stepping up its efforts to help customers outsource its business
processes in India, Spain, Singapore and China.

There are many jobs that, for obvious reasons, can't be outsourced.
Police officers, firefighters, waiters and plumbers would be in this
category. But there are white collar jobs that are very likely safe
from offshore outsourcing.

© 2004 Forbes.com

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http://washingtontimes.com/upi-breaking/20040604-104812-1480r.htm

Analysts predict Chapter 11 for Delta

Atlanta, GA, Jun. 4 (UPI) -- The promise of a boom this summer travel
season may not be enough to stave off Chapter 11 bankruptcy for
Atlanta-based Delta Airlines, analysts said.

The Atlanta Journal-Constitution reported Friday the anticipated
injection of cash this summer won't be enough to make up for low fares,
high fuel prices and labor issues.

In a report to investors Thursday, J.P. Morgan analyst Jamie Baker said
the firm expects Delta to file for reorganization under Chapter 11 by
the end of the year -- sooner than originally anticipated.

Cary Stanford, managing director of Saybrook Restructuring Advisors,
said his firm thinks it could come as soon as July or August if Delta
doesn't get concessions from its pilots.

Saybrook represents Delta creditors.

Delta did not comment on the forecasts but said the airline has been
seeking to cuts costs including pilot costs for more than a year.

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http://www.enquirer.com/editions/2004/05/11/biz_biz1delta.html

Tuesday, May 11, 2004
Delta ponders bankruptcy

Possibility is raised if cuts not made

By James Pilcher
The Cincinnati Enquirer

Delta Air Lines Monday indicated that it might file for bankruptcy
protection if the financially struggling company can't cut costs soon.

Without those cuts, "we will need to pursue alternative courses of
action intended to make us viable for the long term, including the
possibility of seeking to restructure our costs under Chapter 11," the
Atlanta-based airline said in its quarterly report to the Securities
and Exchange Commission.

Previously, company officials had been cautious when referring to
bankruptcy. Delta chief executive officer Gerald Grinstein categorized
it as undesirable at the company's annual meeting last month.

A bankruptcy court judge can make cuts to labor contracts, even if
union members have rejected such cuts in negotiations with a company.

Spokesman John Kennedy would not comment beyond what was in the report
and would not speculate on any future actions by the company.

Delta's stock closed at $4.54 on the news Monday, down 84 cents, or
almost 16 percent.

US Airways went into bankruptcy in the wake of industry changes after
the Sept. 11 terror attacks - and emerged with cuts in labor contracts.
United Airlines is expected to emerge from bankruptcy this summer.
American Airlines avoided bankruptcy last year only by threatening
bankruptcy, resulting in cuts for its pilots and other employees.

Delta, which operates its second-largest hub at the Cincinnati/Northern
Kentucky International Airport, lost $383 million in the first quarter
alone - and it has lost more than $3 billion since 2001.

Of equal concern to company leaders and outside analysts is that the
company's debt load is maxed out, meaning that it cannot borrow any
more. So Delta has turned to its lone major union, its pilots, for wage
concessions.

Management is seeking a 30 percent pay cut plus other productivity
increases along with a freeze on future pay raises. Delta employs
almost 8,000 pilots, including almost 800 based locally.

The pilots are the only organized unit at Delta, which has 8,000
employees locally (including employees of Erlanger-based subsidiary
Comair).

Grinstein and others have stressed that the pilot pay cuts are the only
way that the company can return to profitability.

The airline's branch of the Air Line Pilots Association has countered
with an offer of a 9 percent wage cut and freezing all raises. The
union just got the company to agree to gradually begin recalling 1,060
pilots who were laid off after the Sept. 11 terror attacks.

But pay-cut talks have stalled recently, with Grinstein saying the 30
percent offer was as good as the company could make.

The union "has attempted to engage Delta in negotiations aimed at
assisting the company in attaining an overall competitive cost
structure," spokeswoman Karen Miller said in a statement. The union is
prepared "to assist in every reasonable way in reducing the company's
cost structure and returning it to profitability and stability."

E-mail jpilcher@enquirer.com

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http://timesofindia.indiatimes.com/articleshow/666989.cms

Jobs that the US will never shift to India

ECONOMICTIMES.COM[ SUNDAY, MAY 09, 2004 11:54:18 PM ]

You’ve been hearing about the jobs that are being outsourced to India
and other low-wage destinations. Here are some that will never be
outsourced.

Software Architects: Yes, we know that after the low-end jobs, more and
more high-tech jobs are getting outsourced. But one job that no one is
willing to outsource is the software architects.

One of the main things that companies refrain from outsourcing is
proprietary knowledge that gives companies competitive edge

By 2008, the IT workforce situated in the United States will be 25
percent smaller than it is today, according to Gartner. But the workers
who remain will be more important to the business than ever.

System architects, technology experts and researchers who design and
build the company's most important and complex software are the ones
that are perhaps never going to be replaced.

"We will push some product development projects to India and China, but
the lion's share will stay where it is, because we think the best
workforce is here," Microsoft's chairman and chief software architect,
Bill Gates, said in an interview with CNET News.com .

Business Intelligence: Research from Gartner Inc. and other firms
suggests that it’s a very good time to be doing BI—at least, as an
alternative to working with other technologies. IT professionals who
are employed on a full-time basis and who are developing business
intelligence solutions should feel reasonably secure about their
prospects in the current environment.

Healthcare professionals: Include highly educated and trained
physicians; pharmacists and nurses (college degrees and specialty
training), dental hygienists (associate's degree) and home health aides
(relatively little training and no college degree.)

Jobs Requiring Physical Contact: Other than healthcare pros, janitors,
gardeners, dentists are the jobs that will remain in the US .
Foreign-born workers may do them, but they'll have to move to the US .

High-End Jobs: They'll be working on architecture, strategy, project
management and business processes.

Service-oriented jobs like financial planners, information technology
consultants, pharmacists, accountants, teachers. Though here also the
IT consultant and accountant jobs have started getting offsourced.

Sales jobs are also not liable to get offshored.

One Size Doesn’t Fit All

One of the rules offshoring is that if it can be codified, it can be
done remotely and supported by IT. If it is still tacit and requires a
lot of unstructured discussion, then it has to stay in the US .

An Economist article says that jobs will be created in America that
demand skills to handle the deeper incorporation of information
technology, and the pay for these jobs will be high. The demand for
computer-support specialists and software engineers is expected by the
Bureau of Labour Statistics (BLS) to double between 2000 and 2010.

The demand for database administrators is also expected to rise by
three-fifths.

Among the top score of occupations that are expected to see the highest
growth, half will need IT skills. As it is, between 1999 and 2003 (that
is, including during the recession) jobs were created, not lost, in a
whole host of white-collar occupations.

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