Thursday, 8 September 2011

Talk Talk redundancies - 575 jobs go walk walk

It is pretty bad form when you find you are being made redundant through Facebook, but it seems that is what happened to workers at UK telecommunications company Talk Talk's branch in Waterford.  The company is simply upping sticks and taking its call centre operation to Asia, where people can afford to work for as little as €2,400 per annum.  Without warning.

No doubt Ibec will have words of non-wisdom to say on issues of "competitiveness", wage costs and all the rest.  The fact however, is that we in western Europe cannot compete with such salaries, as our cost of living is much higher.  I can't imagine much demand for €500,000 houses in Delhi, for instance.  I certainly didn't see much evidence of such during the two occasions I visited, anyway.

Talk Talk also cited Eurozone fluctuations  -  but such things are transient, and other companies that do not work through Sterling still manage to operate here.  And are the Indian Rupee or the Philippine Peso tied to Sterling?  

So really, you have to look at Ireland's over-dependent strategy of basing employment on the multinationals...  It might have worked in the past, thanks to the fact that we are mother-tongue English speakers and the avoidance opportunities offered by Ireland's corporate tax laws, but it is something other countries can do now - for far cheaper.

It is not multinationals alone, however.  "Outsourcing" is a buzzword these days, and indigenous Irish companies indulge too.  In Britain, even  those in jobs they might have considered immune to such a practice - journalism, for example - have been hit.   Reuters outsourced parts of its operation to Singapore in 2004, and the Daily Mirror did the same in 2006.

Indeed, if you think about it, it is hard to imagine any job which does not require a physical presence at the point of sale that could not, theoretically, be outsourced.

And where does that leave us all?  Companies end up cutting into their own domestic markets because we are all on the dole, our jobs having gone east.   Maybe companies that readily outsource might not notice the disappearance of their Irish markets, but they would if the same were to happen in the larger EU economies.

Countries like India widely use forms of protectionism, in the form of tariffs, to develop their own economies.   Perhaps it is time that we in Europe did the same for multinational companies operating within the EU, at least in the form of an obligatory code of conduct?

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john said...

History repeats itself again and again. In the 19th Century they "outsourced" cotton production to India from England and it started the union movement and events like the Tolpuddle Martyrs(do not teach this in Ireland). The TALK,TALK sitution is another expample of multinationls doing what THEY PLEASE.It shows how goverments who act as hand maidens to them. If anyone is interested, a good book dealing with how globalisation,Naomi Klein book called The Shock Doctrine, the book is an excellent detailed history of the rise and operation of globalisation and how it effects every person on this planet.

The Gombeen Man said...

Thanks for that, John. Sounds like an interesting - and instructive - read.

Dakota said...

Why are people surprised? It's the new capitalism and accountability is becoming a distant memory. Light touch regulation, in a tax haven.

As long as Ireland overly relies on Transnational Corporations for sustained capital inflows this will happen again and again. They are not here for the craic. Sadly the individuals that lost their jobs in Waterford are victims of a culture which does not care and a global market with easy capital movement.

What is the answer from the Irish perspective? Well an obvious one is to support Irish wealth creation through sustainable growth.

Up till now of course this country has shown itself to be incapable of doing so. This is not a new concept, why does it take job loses of this scale to momentarily jolt "the general public" out of their stupor.

Despite all the rethoric, collocial jibber jabbing, the miriad of polls which shout about Ireland being a FANTASTIC PLACE FOR U.S. MULTINATIONS (unfortunately a confict in terms there, which proves the point), Ireland when all is said and done, is not a good place to do business, for indeginous companies. Costs are too high, the entrepreneurial spirit is not there, no culture of genuine peer to peer support (individuals support one and other in cultures such as the U.S.), incentives are meager to non existant, no political will, no safety net (you get virtually nothing from welfare if your business fails), begrudery (in antiquity known as the evil eye), smallmindness etc......

Bottom line is, if the tax incentives for the U.S. Multis were not there (and again it's the psychological thing with the Irish) most if not all would walk. Could the Government and people support Irish idustry, hey and even support their fellow Irish without and political misgivings? Like heck they could.

The Gombeen Man said...

It's true D. What about upward-only rent reviews as an example of how indigenous business is crippled? Yet Irish business such as Eddie Rocketts are happier going after the pay lowly paid workers, rather than campaigning on rent costs and utility and insurance bills.

I think that seven shops were saved in Blanchardstown SC in a rare show of pragmatism when they finally allowed rent drops...

Yeah, we can only get so far by bending over for the multis.

Peadar said...

Places like Eddie Rocketts want to cut wages for their low paid staff because they are easy targets and they get the nod from goverment who also target the people on social welfare. It is much harder to take on the multi's with their massive resources. The multi's regard the Irish as their white english speaking Mexicans.

Dakota said...

GM If there was any rational basis for the decisions made in this country they would be noteworthy. That's all aspects of what passes for "society" here. The example you gave there GM encapsulates it perfectly, if only there was more basic sense used. It's not to be though, it is always the lazy and cowardly option in this country, always.