Literally Offshoring

 

            The world continues to shrink at a breakneck pace, and cheap offshore labor is beginning to become more accessible than ever to American business.  But the problems with hiring people overseas can be daunting.  Managers have to endure almost a full day of flying coach to make it out to new data centers in India, and bringing Indian workers to the U.S. is encumbered by a lengthy and sometimes prohibitive visa-obtaining process.

            There is a new solution to this, offering yet another means of hiring inexpensive foreign labor and evading stringent U.S. labor laws, while at the same time keeping company interests close to home.  Get this – modifying a cruise ship to be a portable office campus.  Holy sea cow!

            Enter SeaCode, Inc.  No, it’s not a really large submarine captained by Roy Scheider and talking dolphins, it is a company that is proposing this very offshore office building.  They have adopted the moniker “hybrid-sourcing” to describe their new venture.  It envisions a large vessel with office space and living quarters for all of the employees, which remains almost permanently outside of the three and a half mile limit for international waters off El Segundo, California, and is thus immune to U.S. law.  Complete with full-service cafeterias and duty-free shops, they consider it to be the perfect distraction-free setting for engineers, with the option to keep their interests infinitely mobile.  This model is a windfall for not just SeaCode and kin, but for business writers who can come up with all kinds of clever headlines such as “C++faring Lads” and “Just Offshoring”.

SeaCode can pay engineers $21k a year (a savings of $40-$100k on American ones) as they toil away day and night on several shifts to create projects for American companies.  Under maritime law, the employees will be considered “seamen.”  The ship will only dock once a month to take on supplies and dispose of waste.  Rather poignant, that.

            The advantages to customers of this abominable company are astounding.  Besides the distance and the visas, another large problem for traditional offshoring has been the thirteen and a half hour time difference between a manager in California and an employee in India.  You would have to be on the phone at 10:30 PM to contact India at noon.  Now, you can have your cake and eat it, too – while your slave laborers are fastidiously banging away on your project, you can actually be sleeping for a change.

            Perhaps “slave laborer” is an unfair label.  $21k a year certainly trumps the income of a skilled engineer in India, which is a meager $6k.  But Americans just don’t have a prayer if they want to be competitive with that. 

Moving business operations into international waters to evade inconvenient laws is certainly nothing new – gambling boats have been doing it for ages.  But this is the other side of the coin.  Gambling boats use the international waters limit to amass wealth through giving people the things that they crave that are illegal onshore.  SeaCode is doing things that are perfectly legal onshore, but they’re giving themselves what they want, people who will work for poverty wages in America.  It’s an important distinction, and while gambling is certainly not the pinnacle of morality, I’ll definitely employ some relativism to say they’re on higher ground.

            SeaCode’s designs on the outsourcing market are not all bad for America, given the choice between SeaCode’s plan and that of other companies opening factories in India.  American workers are still losing jobs to lower-paid foreign ones at a sickening rate, but since they are only three and a half miles away from the U.S. coastline, they can take a water taxi onto our shores and spend their meager income on U.S. soil, rather than have American wealth siphoned off into another world economy.  So we’ll just ink that into the “pro” column.

            It remains to be seen whether SeaCode can get over some legal and political hurdles to do what they want to, but the fact that people are even considering doing this is further evidence that the golden age of American labor continues to rust.  Futile cries of condemnation do nothing to shake the business sense of offshoring.  But this just-offshoring idea could catch on to a number of different sectors, and in several decades we might see thousands of oceanborne factories.  It will be the new wild west of industry, a land of near-lawlessness.  Hell, will anyone even want to live on land anymore once the ocean becomes such a hip and swinging spot?  Obviously, the jurisdiction of the high seas will have to be completely reevaluated once the ocean itself becomes a de facto country.

Former General Electric CEO Jack Welch once said that the perfect factory would be one that was on a barge, and it could thus be moved to wherever the labor was cheapest.  Someone finally made it practical, only now the world is so small that you can just bring the laborers here (but not really here).  Until an equilibrium is finally reached in all world labor markets, there will always be someone willing to work for cheaper.  This veritable Death Star of labor is to be just another.

 

SourcingMag.com

Seacode:  www.sea-code.com

American Jobs Blog: http://www.gregspotts.com/