Friday, December 05, 2003
Indian salaries for U.S. programmers
Everytime I hear about disgruntled U.S. programmers complaining about job flight to India, I have wondered why noone ever raised that possibility that these programmers had perhaps priced themselves out of the market. Maybe people got so comfortable with their $100,000+ salaries that they forgot to ask themselves whether they were worth that much or even whether the market would correct itself at some point and if it did, what the consequences would be. So, I read David Gumpert's column in Businessweek with a great deal of interest. What would happen if U.S. programmers were paid Indian salaries (very high end Indian salaries, ie)? Apparently, Jon Carson of cMarket decided to find out.
Jon had a brainstorm. What if he offered Americans the jobs at the same rate he would be paying for Indian programmers? It seemed like a long shot. But it also seemed worth the gamble. So Jon placed some ads in The Boston Globe, offering full-time contract programming work for $45,000 annually. (He had decided that it was worth adding a $5,000 premium to what he'd pay the Indian workers in exchange for having the programmers on site.)
The result? "We got flooded" with resumes, about 90 in total, many from highly qualified programmers having trouble finding work in the down economy, Jon says. His decision: "For $5,000 it was no contest." Jon went American. And the outcome? "I think I got the best of both worlds. I got local people who came in for 10% more (than Indians). And I found really good ones."
Even given that $40,000 is the salary level of a very highly qualified Indian programmer (meaning you could get Indian programmers for a *lot* less) and the addition of a premium, there are clearly some advantages to getting the job done close to home. And the anecdotal evidence from this case seems to suggest that a market does exist even at these reduced salary levels. Perhaps Lou Dobbs and his ilk should talk about this possibility as well when he starts off on his anti-free trade tirades?
Jon had a brainstorm. What if he offered Americans the jobs at the same rate he would be paying for Indian programmers? It seemed like a long shot. But it also seemed worth the gamble. So Jon placed some ads in The Boston Globe, offering full-time contract programming work for $45,000 annually. (He had decided that it was worth adding a $5,000 premium to what he'd pay the Indian workers in exchange for having the programmers on site.)
The result? "We got flooded" with resumes, about 90 in total, many from highly qualified programmers having trouble finding work in the down economy, Jon says. His decision: "For $5,000 it was no contest." Jon went American. And the outcome? "I think I got the best of both worlds. I got local people who came in for 10% more (than Indians). And I found really good ones."
Even given that $40,000 is the salary level of a very highly qualified Indian programmer (meaning you could get Indian programmers for a *lot* less) and the addition of a premium, there are clearly some advantages to getting the job done close to home. And the anecdotal evidence from this case seems to suggest that a market does exist even at these reduced salary levels. Perhaps Lou Dobbs and his ilk should talk about this possibility as well when he starts off on his anti-free trade tirades?
