A couple of weeks ago, an article at the ABC made the point that if I can do my job lounging arounding on a beach in Australia, then so can someone living in a much cheaper overseas location and willing to be paid much less for it. Plenty of commentators hold that this has already happened to lower-skilled workers in rich countries, in the form of factories, call centres, information technology consultancies and the like moving to developing countries with lower costs of living. Should high-skilled workers like myself be afraid that the same might happen to us?
The conventional answer amongst developed-world politicians and economists seems to be that we work on developing even higher skills. In the medium term, at least, my own job isn’t likely to be replaced by someone from overseas because only a relatively small number of people have the same level of education that I do. But is it reasonable to suppose that Westerners will remain forever more skilled than everyone else?
Of course I already compete in some sense with millions of other software developers and academics across the developed and developing world. Yet, so far, I get by, because there’s so much software to be developed and so much teaching to be done that it takes millions of people to do it. But hoping that enough work exists to keep all of those millions employed leads to the apparently-perverse campaign to create work.
No doubt there is plenty of work that could be done to improve the lives of people living in developing countries: building infrastructure, improving health, raising levels of education, and so on. But not, apparently, enough of it to keep both developing-world and developed-world workers employed or at least paid at a rate that each party feels able to accept, if fears about offshoring are to be believed. In any case, development economics is far outside the scope of this blog.
Maybe I could move to a lower-cost country myself and accept a lower level of remuneration. Some people do indeed do this, freelancing out of Bali or the like, albeit in small numbers compared to the number of people who remain in rich countries. And of course there are reasons to remain in a rich country: better infrastructure, higher levels of education, a stronger rule of law, and so on, all of which cost money.
E-changers like me have in a sense settled for a minor version of the same by moving to lower-cost areas within our own countries. If it comes down to it, and I can no longer keep my job purely through being more educated, more experienced, and having better English than most people in those cheap developing countries, maybe I could get by through reducing my living expenses further. I’d like to think that the developing and developed world alike can enjoy great infrastructure and good health and so on, but would it matter if I had to get by without holidays to Europe, say, or luxury cars?
I’m not expecting people in developed countries to sign up to such a regime any time soon—I hear enough complaints about how “poor” rich countries are already. But having thought about it I’m at least a bit more comfortable that a palatable option exists.