British Expatriate Network

I happened to see Phil (Nike) Knight getting a bit of a dressing down on an old Michael Moore movie earlier this month, regarding Nike's usage of far eastern sweat-shops to make the shoes and clothing they sell.

Knight basically said that Nike are forced to outsource their labour to cheap countries because Americans won't do jobs like this. Moore then countered by telling Knight to build a plant in Flint, Michigan and the people would come to work there. Knight wasn't convinced but played along with Moore.

Moore proceeded to Flint and organised a meeting whereby anyone who was willing to work in a Nike factory should show up. He taped the rather large crowd of unemployed folks that showed up and took it back to Portland to show Knight.

Now this is where I got a bit irritated. Knight proceeded to say that Americans will say they want the jobs but when it comes down to it, they actually don't and won't do them.

Is this true? Are there really jobs that people of a particular country simply won't do? Is making shoes really that dull a job?

I personally think Knight and his ilk are wrong, are using this misconception as a basis for sending any work like this out of the country where it can be carried out excessively cheaply and methods can be used to work staff harder than any labor union would ever stand for here.

What do you think?

It comes down to business, and when you know that if you take it elsewhere, and can pay people in other countries less what you will pay someone in the west, then most people will do just that.

What about the repercussions though? True, Nike are probably enjoying their bottom line at the moment but how about companies that outsourced support for credit cards etc. and are now facing lawsuits when their "employees" sold the information on?

Does that increase their bottom line or reduce it as people leave for more secure, home-based companies? A lot of these chickens have not yet come home to roost. It reminds me of when ships switched flags to Liberia or Panama and then people wondered why their crews were of poor quality and many were involved in collisions or losses.

Cal a lot of IT companies, and you bound to get a person in the phillipines or India. There are now companies in India looking for staff from the west, kind of like a reversed outsource shock

I think people will work if the conditions are acceptable. I do believe, however, that both in the US and the UK, we are spoilt regarding working conditions and unions. So, if you get a company like Nike where in order for them to set up a factory in the US, they have so many rules to comply to, unions enforcing strict work to rule, coming in and telling employees that they should demand more money etc., then for companies like Nike, it is cheaper and safer regarding keeping the factory open, to go abroad where countries aren't as strict regarding their working conditions.

I'm not saying that Nike would be corrupt and not care if a worker was injured, but the repercussions of such an event would be far greater here, and in the UK, than it would be in countries such as China for example.

On the one hand I think it is wrong to go abroad when there are willing people here to work. But, on the other hand, I don't blame companies who feel they have to go abroad for their labor when customers continuously demand cheaper goods or they shop elsewhere, and the constantly high demand on companies to outperform each other and gain better prices on the stock market. I can't help thinking that if these other countries really cared about their citizens, they would do something about big companies coming in and using their labour. But it is to their benefit to keep these companies in their countries.

Why is gaining a high share price on the stock market like some sort of Holy Grail?

Companies make or lose money irregardless of share price. The only responsibility of the company is to the shareholder though and this culture strikes me as both misplaced and wrong. It has led us to outsourcing, false accounting (see Arthur Anderson/Enron et al) and the ultimate irony, closure of some plants or offices that actually contributed heavily to the profit and growth of certain companies.

Why is loyalty to employees or staff regarded as such a joke? What makes a shareholder more worthy? Would the ultimate shareholder not be an employee who owns stock in a company?

Regarding unions, they are something that has evolved and will probably evolve in those other countries sooner or later.

Sorry, I thought share prices fluctuated depending on the profits a company made (that is that more people will buy the shares if the company is making a decent amount of profit and sell them when they don't). :???:

I do agree with you, Pilgrim. But then we do live in a society that values capitalism above socialism. Profit margins dictate.

Yes, obviously that is the idea but it is based upon "reported" earnings etc. therefore, open to abuse which we have seen in the past few years.

The point is that the shareholders can swing company policy so that their share value rises in the short term but whether this is good for the company or not is another matter.

My mother worked for a company that Lord Hanson got his hands on in the late 80's and it was an absolute disaster after that. Hanson made out rather nicely of course but the company was gutted and basically had disappeared by the turn of the century. Perhaps the shareholders did well by selling to him at the outset but as far as that 200 year old company went, they sent it like a lamb to the slaughter.

I am not surprised many companies are buying back their shares nowadays.

It's all about money. The more you can make at a cheaper price and sell at a higher price the better.

In the case of Nike it may be true. But in general, in the corporate world, it is a policy that everyone has to do, a case of keeping up with the Jones, Incs. If you're the only corporation in the top 100 on the stock market who doesn't outsource, you won't be there for long. You're wasting money. You're losing shareholder confidence.

Never mind that the very people that would spend their extra money on shares in your company are the ones that are on a pile of 200 resumes for the only IT job in town this week.

And in a way that is similar to what I was saying, East, that if you have your prices higher than your competitors, you will lose costomers and therefore profits will drop. We, as individuals demand lower prices and companies provide them.

Was the film "Roger and Me"?

I think Phil Knight got a bit of a raw deal.
The film was mainly about companies oursourcing jobs from current US plants.
Nike never really had US plants, it was set up from the outset in Thailand or wherever.

However US workers will do jobs like that. In our small town we only have 1 factory. It refurbishes old altinators, re-assembles them and sells them.
nasty horrible dirty work. Yet people work there.

I've not seen that Michael Moore movie but have heard about it. He, as usual, takes a complex issue and tries to create a bad-guy' who he blames for the problem. It was the same story with 'Roger & me.' I was working in the car industry when that came out. The fact that the US manufacturers were being seriously challenged by Japanese tranplants and imports - who were making better cheaper cars and that Americans were buying them compeltely passed him by.

Nike is a global company and sells more stuff outside the US that inside the US. Americans have no right to 'own' production rights. It's true that the wages they offer are low - but in countries where these factories exist you sometimes hear of teachers or nurses wanting to work in factories because the wages are much better. That' not good for the countries infrastrucutre long term.

Nike, pressured by consumer groups and the threat of boycotts, has made a lot of strides to fix the problems they were previously turning a blind eye to. If these factories were closed in favour of America factories - the local workers would be out of work with no unemployment benefit or health and nowhere else to go. I'm sure they'd rather be working.

So I'm not in favour of keeping jobs in the US if they can be done more cheaply elsewhere. It sounds harsh but I think ''free trade' does more harm than good.

Shareholders and their demands for huge profits are another matter.

roll As someone said "its all about money", business does not care about the repercussions. It cares about short termism and profits. Gone are the days where a company has some loyalty to those it employs and employees show loyalty back.
Its a case of dog eat dog and false claims.

Pretty sad that our society has come to all that.

We look at the industrial revolution, but back when it first kicked off, the factory owner built his workers homes etc.

No, it was "The Big One" which was tied into "Stupid White Men"'s book tour.

"Roger and Me" gets picked apart at length but history does rather indicate that Roger Smith managed to waste millions of dollars, made by GM and given to GM by the Federal Government, whilst simultaneously closing plants that were still capable of production and relocating them to Mexico. Smith could probably claim he was "saving money" but what idiot put him in charge when it was basically down to him that they had lost the money in the first place?

"Roger and Me" also gave a good demonstration of how some shareholders are more equal than others, namely when MM gets kicked out of the GM Annual Shareholders meeting so that he can't ask Roger Smith a question. That's pretty much how it is in the land of the "free" and home of the chicken CEO/politicians.