IS YOUR JOB GETTING OUT SOURCED

What is Outsourcing?

2010-01-10T23:20:00.000+14:00

Outsourcing refers to a company that contracts with another company to provide services that might otherwise be performed by in-house employees. Many large companies now outsource jobs such as call center services, e-mail services, and payroll. These jobs are handled by separate companies that specialize in each service, and are often located overseas.

There are many reasons that companies outsource various jobs, but the most prominent advantage seems to be the fact that it often saves money. Many of the companies that provide outsourcing services are able to do the work for considerably less money, as they don't have to provide benefits to their workers and have fewer overhead expenses to worry about.

Outsourcing also allows companies to focus on other business issues while having the details taken care of by outside experts. This means that a large amount of resources and attention, which might fall on the shoulders of management professionals, can be used for more important, broader issues within the company. The specialized company that handles the outsourced work is often streamlined, and often has world-class capabilities and access to new technology that a company couldn't afford to buy on their own. Plus, if a company is looking to expand, outsourcing is a cost-effective way to start building foundations in other countries.

There are some disadvantages to outsourcing as well. One of these is that outsourcing often eliminates direct communication between a company and its clients. This prevents a company from building solid relationships with their customers, and often leads to dissatisfaction on one or both sides. There is also the danger of not being able to control some aspects of the company, as outsourcing may lead to delayed communications and project implementation. Any sensitive information is more vulnerable, and a company may become very dependent upon its outsource providers, which could lead to problems should the outsource provider back out on their contract suddenly.

While outsourcing may prove highly beneficial for many companies, it also has many drawbacks. It is important that each individual company accurately assess their needs to determine if outsourcing is a viable option.

List companies that outsource and those that haven't.

2008-04-13T10:16:00.002+14:00

Here are a list companies that outsource and those that haven't.

Advertisements [?]
http://www.hireamerica.us / Is a new web site devoted to issues concerning jobs and Bush's* job-loss economic policies.

Some of the linked pages are still under construction, but I think this site has a lot of potential.

I don't now if this site was inspired by Lou Dobbs' list of companies involved in outsourcing, but I wouldn't be surprised if that turned out to be the case.

BTW, when BFEE 'experts' cite Germany's 10% unemployment, remember that they have been absorbing hundreds of thousands of refugees and the entire former East Germany during the last 15 years! They're actually doing an excellent job, IMHO!

Also, most countries have policies which demand that their citizens are hired FIRST. They only hire non-citizens if no citizen is either qualified or able to do the job.

Repuke arguments don't hold water.

http://www.hireamerica.us/

http://forum.noslaves.com/index.php?showtopic=81

Companies crow about keeping jobs in the USA

2008-04-13T10:14:00.001+14:00

By Stephanie Armour, USA TODAY

As concern over the loss of jobs overseas intensifies, some companies are promoting their decision not to hire workers in other countries to replace U.S. employees.

"No outsourcing" could become the latest twist on the "made in the USA" slogan. Now, consumers are compiling Web sites that track which employers outsource overseas, which means they hire workers in other countries to do jobs typically held by U.S. employees. And some businesses are letting clients request that work not be farmed out to overseas workers.

• TaxBrain, an online tax-preparation program, includes a sentence in its program that assures customers its employees are in the USA: "All TaxBrain assistance is served from our office in California; we don't outsource jobs to India or any other third parties."

• At First Health (FHCC), a managed care company in Downers Grove, Ill., clients come to tour the call center before signing up and receive assurances that the company won't outsource.

• Pleasanton, Calif., consumer direct lender E-Loan (EELN) discloses to home equity customers that some application work is handled in India — and then lets clients choose whether to participate or have the work done domestically.

• Alpine Access, a Golden, Colo.-based call center whose employees work at home, appeals to clients by offering to match operators with the type of customers who call. Says CEO Reg Foster: "We're not just keeping jobs in America, we're creating jobs in America."

Consumers are paying attention. Web sites such as Hireamerica.us list companies that outsource and those that haven't. Those that don't are dubbed "patriotic." U.S. employers will move about 3.3 million white-collar jobs and $136 billion in wages abroad, according to Forrester Research. That's up from $4 billion in wages in 2000.

Sentiment against outsourcing is building. At the federal and state level, legislators are considering bills aimed at discouraging companies from offshoring.

The push by companies to advertise that they haven't outsourced is so new that there are no studies on how many are doing so.

Many companies that do outsource jobs aren't worried. Just 11% believed it hurt their brand image, according to a 2004 survey by Hewitt Associates.

Tom Peters, author of Re-Imagine! Business Excellence in a Disruptive Age, says people may boycott companies as the issue heats up. But companies that don't offshore "will be at a disadvantage."

CA did it to me again !

2008-04-13T09:55:00.005+14:00

As you see a few post ago I was outsourced from CA by CANON Friday was my last day at CA/CANON .

I was told that CA need to save some money and didn't think they needed 5 people in the mail room. So they let me go.

God I though now that I worked for the OUTSOURCING company that I would save. God how wrong I was !!!

This is not wright and this is the reason why Corp America is going to hell !!

You want me to by thing from you like cars, food, t.v, ect. THEN KEEP JOB HERE IN THE USA !!!!

The thing that scares me is this is all a fad and Corp America will see ( The Hard Way ) that this will not work and they will not save the money they think they will and we will not stand for it !!

Boycott any company that OUTSOURCING !!!

Did you see sunday paper ? CA doing it again !

2008-04-10T01:35:00.002+14:00

Looks like deja vu all over again at CA Inc.

After the stock market closed for the weekend Friday afternoon, CA reported in a regulatory filing plans to eliminate 400 more jobs than planned as part of a restructuring program launched in fiscal 2007, and take an additional $75 million to $100 million in charges tied to the job cuts and consolidation of global facilities.

The original August 2006 restructuring called for 1,700 job cuts, at a cost of $200 million. But in its third-quarter report filed in February, CA quietly increased that number to 2,400. CA spokesman Dan Kaferle said the move was part of a plan to improve the company's expense structure and "increase our competitiveness."

Citing a quiet period in advance of a fourth quarter earnings release, he declined to say which regions, or job titles, would be impacted by the cuts, or specifically why they were needed now.

CA to sell last U.S. property, in Central Islip

2007-06-28T03:04:00.000+14:00

this what CA had to say to newsday, gee do CA know how man employees working for them, I guess not because thers mor then 10 people in the 1150 Motor Pkwy office.
well it show how much CA is on top of thing. mybe there get it right next time and yes there will be a next time there just geting started !

CA to sell last U.S. property, in Central Islip

An unassuming advertisement for a 100,000-square-foot warehouse at 1150 Motor Pkwy. in Central Islip might have blended in with those for other sale properties in western Suffolk, but this one will mark the end of an era.

The building, which was described in a Securities and Exchange Commission filing as a "distribution center," is the last remaining piece of North American real estate in the portfolio amassed by the former Computer Associates under the leadership of founder and former chief Charles Wang. When it is sold, all of the company's non-European properties will be leased, according to its most recent annual report.

CA Inc. spokeswoman Michelle Healy said the building, which was advertised in Long Island Business News, is no longer needed because the company is "outsourcing records management and print shop." She also said that only 10 employees would be "affected" and that the sale is part of CA's effort to become more efficient.

"CA is constantly evaluating its cost structure to ensure it is competitive with its industry peers and making the most effective use of its capital," she wrote in an e-mail. Part of that effort, she wrote, is "working to better align our real estate portfolio with our business needs."

As of March 31, 2006, the company owned 965,000 square feet of office and warehouse space in North America. The year before, CA's annual report read, "We own an approximately 850,000- square-foot corporate headquarters in Islandia, N.Y., as well as various facilities throughout the United States ranging from 15,000 to 235,000 square feet."

Healy declined to confirm information from a popular commercial real estate listings Web site that the asking price for the Central Islip warehouse is $9million.

She wouldn't comment on specific questions about longer-term plans for CA, many of whose top executives live off-Island, except to say, "We remain committed to Long Island."

CA against Wang

2007-04-17T06:43:00.000+14:00

Charles Wang, the co-founder and former chairman of Computer Associates, directed and participated in the massive $2.2-billion accounting fraud at the company, according to a blistering report issued late Friday by a committee of outside directors of the company now known as CA.

The report said the company should pursue civil actions for damages of $500 million against Wang and a small circle of former executives around him, claiming they were responsible for fraudulently inflating the company's profit margin to artificially raise the price of the company's stock.

The report also calls for Wang to repay the hundreds of millions of dollars in company stock he received through his management of the company.

The report, filed in Delaware, was prepared at the request of the CA board in answer to civil lawsuits in Delaware and in U.S. District Court in Central Islip against the company, and many of its directors and officers, seeking damages for stock fraud.

In addition to calling for the company to bring a civil suit against Wang, the report has another purpose. It amounts to a legal brief by the current officials of the company, arguing that the only people who should be held liable for damages in the civil suits are Wang and the circle of executives around him. Those executives include his longtime protege Sanjay Kumar, who recently was sentenced to 12 years in prison for involvement in the scheme.

The essence of the fraud was the so-called 35-day month in which the company would backdate some sales made in one month to the previous month to match the expectations of Wall Street analysts, the report said, linking the practice to Wang.

In a rare public statement, Wang said he was "appalled" by the report. "This fallacious report does not serve the best interest of shareholders, customers and employees," he said.

Suggesting the report was based at least in part on information from Kumar, Wang said he found it "hard to understand how the special litigation committee could believe the information they were given was credible, when their sources are those who perpetrated the crimes at issue and then lied about them to both internal company investigators and the government."

Sources familiar with the criminal investigation into the company by the federal government have said that whatever went on at the company, there was never any evidence to bring an indictment against Wang.

The committee's report said it "has uncovered credible and corroborated evidence that Mr. Wang both directed and participated in the 35-day month practice by ... instructing subordinates ... to obtain additional revenues after the closes of quarters to be counted in the prior quarter in order to meet analysts' expectations and ... negotiating and participating in deals he knew to be backdated."

"Indeed, it is the view that Mr. Wang was the direct cause of the 35-day month practice, both due to his actual conduct and the culture that he established, and that it existed for most, if not all, of his tenure as CEO," the report said.

Wang, who co-founded the company in 1976, left it in 2002.

The report portrays a company that for most of its history, according to one unnamed source, operated "as if he were running it out of his garage." In addition, Wang was assailed for establishing a "culture of fear" that brooked no dissent and in which inexperienced people were promoted to positions for which they were not qualified.

The report found the five outside directors of the company at the time of the fraud were unaware of the illegal actions and shouldn't be held liable, including former New York Stock Exchange president Richard Grasso, ex-Sen. Alfonse D'Amato, and current Stony Brook University head, Shirley Strum Kenny.

Wang for the first time acknowledged that during the probe he met with lawyers hired by CA and he said he "fully cooperated with the U.S. government at all stages."

More fundamentally, Wang said, "As the founder of CA, I am devastated by what has happened to the company and feel personally wronged by Sanjay Kumar and the management team he installed."

Meanwhile, dissident shareholder Sam Wyly celebrated. "It's a great day for us," said William Brewer, a lawyer for Wyly. "How do you say, I told you so."

tHIS IS ONE REASE WHY CA OUTSOURCEING BUT WHY SHOULD I THE ONE THAT NOTHING TO DO WITH THERE GREAD TO LOSE A JOB I WORKED SO HARD TO MAKE THIS COMPANY GET OUT OF TRUBLE ? I AM SO GLAD THIS GOING TO HAPPEN NOW " WHO WANTS TO WORK FOR A COMPANY THAT SO EVIL AND GREADY AS CA !! THIS COMPANY WILL FALL DON'T BY CA STOCK YOU WILL LOSE YOUR MONEY LIKE i DID !!

NEW CLIP ART

2007-03-14T07:19:00.000+14:00

we at CA thanks Sanjay Kumar for f$%k us all !

2007-03-06T05:00:00.000+14:00

Computer Associates Ex-CEO Pleads Guilty to Business Fraud
by The Associated Press4/25/2006 —

Sanjay Kumar, the former CEO of Computer Associates International Inc., pleaded guilty on Monday to obstruction of justice and securities fraud charges in a massive accounting scandal at the Long Island-based software company.

According to a 2004 indictment, Kumar was so involved with adding false revenue to a financial quarter even after it closed that he flew on a corporate jet to Paris in July 1999 to finalize a $19 million deal and signed a contract that had been backdated.

The indictment also charged that executives instructed salespeople to complete deals after the quarter had closed -- a practice known within the company as the "35-day month" -- and "cleaned up" contracts by removing time stamps from faxes.

"Your honor, my conduct was wrong. I take responsibility for participating in this practice, and I apologize for my actions," Kumar told the judge, referring to the accounting fraud.

The company's former head of worldwide sales, Stephen Richards, pleaded guilty to the same charges in federal court in Brooklyn. He and Kumar left the courthouse without speaking to reporters.

The guilty pleas "are a culmination of the government's successful investigation into a culture of corruption and fraud at Computer Associates," U.S. Attorney Roslynn Mauskopf said in a statement.

Five other top executives had previously pleaded guilty.

Kumar, 44, and Richards, 41, remain free on $5 million bond while awaiting their Sept. 12 sentencing. The law allows a maximum sentence of 20 years in prison for the offenses, but the term could be substantially less under federal sentencing guidelines.

Kumar also is a co-owner of the New York Islanders hockey team.

Computer Associates, which makes software and storage systems for large corporations, agreed in 2004 to pay $225 million to shareholders in a settlement letting it defer criminal prosecution. An outside monitor is tracking its financial reporting, and the company is reviewing past financial filings. Computer Associates would face no prosecution if it follows terms of the deferral agreement for 18 months.

Computer Associates restated its financial results from 2000 and 2001 to reflect $2.2 billion in revenue that was improperly booked.

During the company's fiscal year 2000, it "prematurely recognized" more than $1.4 billion in revenue from at least 116 contracts that had not yet been signed, the Securities and Exchange Commission said.

The Islandia, N.Y.-based company has said it had billions of dollars in annual revenue in the late 1990s. Reported revenues plunged after the company changed its accounting practices in the face of increased outside scrutiny.

After the FBI began investigating the company in 2002, Kumar and Richards orchestrated a cover-up that involved lying under oath about the "35-day month" and other frauds and trying to buy the silence of a potential witness, authorities said.

You can contact The about "Computer Associates Ex-CEO Pleads Guilty to Business Fraud" at editor@redmondmag.com.

HERE ARE SOME GREAT COMICS !!

2007-03-03T11:53:00.000+14:00

PLEASE USE THESE BANNER GET THE WORD OUT !!!

CA recently outsourced too ARINSO

2007-03-03T10:19:00.000+14:00

As previously announced, CA recently signed a contract with ARINSO International, a leading global provider of HR business solutions. ARINSO will provide HR Services worldwide including service center operations for HR-related requests, benefits and leave administration, end-to-end recruitment services in North America, tuition assistance and employee data and file management.

Over the next few weeks, we will be providing additional details including contact information for the new HRSC and ‘what you can expect' in the subsequent phases of our implementation. In the interim, if you have any questions, please contact your local HR representative.

What HR representative ?

CA selects ARINSO for global HRO & recruitment process outsourcing
New York, Brussels, December 19, 2006ARINSO International (Euronext Brussels: ARIN), a leading provider of HR Technology Consulting & Outsourcing Services, announced today that it has been selected by CA, Inc. ('CA') one of the world's largest information technology (IT) management software companies, to provide global HRO services and outsourced recruitment. ARINSO will support these administrative processes from its HR Shared Service Centers in the Americas, Asia Pacific and Europe.

The agreement with CA spans a period of five years and covers HR administration in over 30 countries globally and Recruitment Process Outsourcing (RPO) in North America. The agreement with CA has a total contract value of over USD $60 million and confirms ARINSO's position as a global HRO service provider. It also demonstrates ARINSO's expertise in key HR processes, such as recruitment and HR administration.The global HRO solution provided by ARINSO will serve over 15,000 CA employees and will enable CA to enhance the administrative and transactional services to internal customers by rolling out innovative self-service functionality. Services will be provided by four regional HR Shared Service Centers; the Americas will be serviced by centers in Atlanta (US) and in Buenos Aires (Argentina), the center in Katowice (Poland) will service the EMEA region, and the fast growing Asia Pacific region will be serviced by a center in Manila (Philippines)."CA selected ARINSO for its strong expertise with SAP and its ability to work with us to simplify and standardize our HR business processes globally," said CA's Executive Vice President of Human Resources, Andy Goodman. "This new HR model will allow us to maximize the strategic value of CA's HR professionals and provide more value-added services to our internal customers."The North America RPO solution will enable CA to outsource the annual processing of over 20,000 candidates and the recruitment of over 1,000 applicants, based on a unique concept of 'no placement, no payment.' ARINSO has partnered with the Professional Recruitment Outsourcing unit of Philadelphia-based CDI Corporation (NYSE: CDI) to support CA's recruitment activities in the U.S. and Canada. The recruitment solution from VURV Technology will be used as the technology platform for recruitment efforts."Offering the right technology foundation and the most efficient delivery services to support vital HR processes, on a global basis, that's what we are all about at ARINSO," said Ignacio Palomera, President of ARINSO US.
INFORMATION FOR EDITORS CONTACT:ARINSO InternationalMichael CustersMarketing & Communications

Managermichael.custers@arinso.comPhone: +32 2 558 06 70
About ARINSO International ARINSO International (Euronext Brussels: ARIN) is a global HR Services partner offering comprehensive HR business solutions to the world's largest employers. ARINSO is dedicated to HR Excellence through Strategic Consultancy, Outsourcing Services and Technology Integration Services.

ARINSO was founded in 1994 and employs over 2,500 staff in 25 countries, including Argentina, Australia, Austria, Belgium, Brazil, Canada, Finland, France, Germany, Italy, Luxembourg, Malaysia, Mexico, Morocco, the Netherlands, the Philippines, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, Thailand, the United Kingdom & the United States.About CA CA (NYSE: CA), one of the world's largest information technology (IT) management software companies, unifies and simplifies the management of enterprise-wide IT. Founded in 1976, CA is headquartered in Islandia, N.Y., and serves customers in more than 140 countries. For more information, please visit http://ca.com/.

America is Losing IT and Other Technical Jobs To Outsourcing At An Alarming Rate....

2007-03-03T10:16:00.000+14:00

THIS ISN'T A SHIRT OR A TOY, this is YOUR bank accounts, credit and personal information, in a foreigners hands.

How easy would it be for terrorists to get this information ?

Would a non-American think twice about selling this information to the wrong person ? Don't do business with companies that outsource....
Dump their stock, tell them you won't do business with them because they outsource.

Write to Congress, your state Senator, the President and ask them why companies are allowed to import cheap labor on L1/H1 Visa's when there is an American needing that job. Ask Why American workers are being forced to train their cheaper replacement and then laid-off.

Ask why your personal information; credit, banking and health info is in the hands of foreigners.

Billions in lost tax revenue, many livelihoods destroyed. So what can you DO ABOUT OUTSOURCING ?

http://www.nojobsforindia.com/

Bush economic report praises 'outsourcing' jobs

2006-12-30T10:28:00.000+14:00

Bush economic report praises 'outsourcing' jobs

Tuesday, February 10, 2004By Warren Vieth and Edwin Chen, Los Angeles Times

WASHINGTON -- The movement of U.S. factory jobs and white-collar work to other countries is part of a positive transformation that will enrich the U.S. economy over time, even if it causes short-term pain and dislocation, the Bush administration said yesterday.

The embrace of foreign "outsourcing," an accelerating trend that has contributed to U.S. job losses in recent years and become an issue in the 2004 elections, is contained in the president's annual report to Congress on the health of the U.S. economy.

"Outsourcing is just a new way of doing international trade," said N. Gregory Mankiw, chairman of Bush's Council of Economic Advisors, which prepared the report. "More things are tradable than were tradable in the past. And that's a good thing."

The report, which predicts that the nation will reverse a three-year employment slide by creating 2.6 million jobs in 2004, is part of a weeklong effort by the administration to highlight signs that the recovery is picking up speed. Bush's economic stewardship has become a central issue in the presidential campaign, and the White House is eager to demonstrate that his policies are producing results.

In his message to Congress yesterday, Bush said the economy "is strong and getting stronger," thanks in part to his tax cuts and other economic programs. He said the nation had survived a stock market meltdown, recession, terrorist attacks, corporate scandals and war in Afghanistan and Iraq, and was finally beginning to enjoy "a mounting prosperity that will reach every corner of America."

The president repeated that message during an afternoon "conversation" on the economy at SRC Automotive, an engine-rebuilding plant in Springfield, Mo., where he lashed out at lawmakers who oppose making his tax cuts permanent.

"When they say, 'We're going to repeal Bush's tax cuts,' that means they're going to raise your taxes, and that's wrong. And that's bad economics," he said.

Democrats who want Bush's job were quick to challenge his claims.

Massachusetts Sen. John F. Kerry, the front-runner for the Democratic presidential nomination, supports a rollback of Bush's tax cuts for the wealthiest Americans and backs the creation of tax incentives for companies that keep jobs in the United States -- although he supported the North American Free Trade Agreement, which many union members say is responsible for the migration of U.S. jobs, particularly in the auto industry, to Mexico.

Campaigning yesterday in Roanoke, Va., Kerry questioned the credibility of the administration's job-creation forecast. "I've got a feeling this report was prepared by the same people who brought us the intelligence on Iraq," he said. "I don't think we need a new report about jobs in America. I think we need a new president who's going to create jobs in America and put Americans back to work."

In an evening appearance at George Mason University in Fairfax, Va., North Carolina Sen. John Edwards mocked the Bush administration's economic report.

Edwards, also a Democratic presidential nomination candidate who also supports repealing tax cuts for the richest Americans and offering incentives to corporations that create new jobs in the United States, said it would come as a "news bulletin" to the American people that the economy is improving and the outsourcing of jobs overseas is good for America.

"These people," he said of the Bush administration, "what planet do they live on? They are so out of touch."

The president's 411-page report contains a detailed diagnosis of the forces contributing to the U.S. economic slowdown and a wide-ranging defense of the policies Bush has pursued to combat it.

It asserts that the last recession actually began in late 2000, before the president took office, instead of March 2001, as certified by the official recession-dating panel of the National Bureau of Economic Research.

The report repeats the administration's contention that the Bush tax cuts must be made permanent to have their full beneficial effect on the economy.

Social Security also must be restructured to let workers put part of their retirement funds in private accounts, the report argues. Doing so could add nearly $5 trillion to the national debt by 2036, the president's advisers note, but the additional borrowing would be repaid 20 years later, and the program's long-term health would be more secure.

Corporate America: The Land of the Greed

2006-12-30T10:23:00.000+14:00

August 31, 1998

One can get attached to wide open spaces living in the center of the United States. However becoming geographically challenged is a drawback if you stay too long. Over the last thirty years business trends have led to a disturbing fact; small town America is dying.

Case in point: Enid, OklahomaIn the late 1960's and early 1970's my parents would cram the family in the car and drive to the third largest city in Oklahoma; Enid. It was a modern city in many ways. Champlin refinery (and the oil business in general), Phillips University, Vance Air Force Base, Bond bakery and Gold Spot dairy all provided Northwest Oklahoma with a big city outpost and good jobs to keep the city a wonderful place to live and work. At one time Geronimo automobiles called Enid home (only one Geronimo car still exists and it is on display at a local museum.)

The Enid town square was visible from miles away as several skyscrapers surrounded and dwarfed the large county court house in the center of town. The Broadway Tower was the largest. Enid hosted another type of skyscraper; North of downtown stretched one of the top three largest grain storage complexes in the world.

Three railroads served the town and the grain complex with lines radiating out in ten directions (The Atchinson Topeka and Santa Fe, the St. Louis and San Francisco (better known as "The 'Frisco"), and the Chicago Rock Island and Pacific (better known as "The Rock Island").
In fact, the town still had passenger rail service up until 1968, although the Rock Island's Twin Star Rocket was probably not used frequently because it arrived in the early morning hours. An amusement park existed on the Southwest side of town.

As Enid FadesToday it is obvious that Enid is dying. The oil business has moved to Houston and overseas. In fact, the Champlin refinery has been dismantled and moved to Houston. Gold Spot dairy has closed after being merged with corporate conglomerate AMPI (American Milk Producers Incorporated).

While not a large dairy, Gold Spot did have an effect and local presence in the town. The milk tanks have been removed and a thrift store has replaced the corporate offices. Bond bread is gone. Geronimo cars were only produced for a short time because after the plant burned, no one bothered to rebuild. The downtown square looks like a ghost town. One expects a tumble weed to roll by at any minute.

Parking is no problem as it was in the 1960's and 1970's. Only three railroads still remain in town. Farmrail, the Burlington Northern Santa Fe, and the Union Pacific. The Union Pacific runs through town on a north south route. The Burlington Northern Santa Fe runs east west. Farmrail's deteriorating tracks run southwest of town. There are no local railroad offices remaining.

Many elevators sit empty while grain piles up outside other active elevators. The railroad no longer sees grain transport as a volume business in Enid so much of it is moved by semi trailers. Storage of grain is no longer seen as necessary in this town which is far removed from export grain sea ports. The oil business in Oklahoma has been dead for nearly fifteen years.
The result: Enid is collapsing. The loss of business has forced Phillips University to close its doors and liquidate its assets. The mall that was built to try and attract retail business is suffering. Even more the small businessman has changed. The Ma and Pa business have given way to national franchises. When was the last time you had a good Lotta Burger or Gold Spot hot fudge sundae?

Corporate AmericaWhat does this have to do with Corporate America? Corporate America has one goal; to please the stockholder. The customer and employee are left to suffer the consequences and, in turn, the nation suffers.

The big cities get bigger and the small cities die.

Corporate America is a silent invasion that takes families captive. These families are forced to move to the dangerous metro centers where gangs, crime and a general hectic pace of life prevail.

But that is another story.

The problem is that Corporate America has lost touch with general moral values upon which this country was built. Corporate America has become the Land of the Greed. Honesty, Quality, Company Loyalty to the employee and by the employee to the company, modest growth, customer satisfaction, and life-long careers all seem to be worthless in today's rat race. As a society we have become all too willing to purchase products that lack quality. Note the phrase "we live in a throwaway society."

What has caused this lack of quality? There are numerous reasons. Employees are forced to leave small cities like Enid and live in the traffic choked, family unfriendly, dirty "mega"tropolises. Mergers always loom on the horizon with the prospect of confusion and layoffs. Why go the extra mile when you are just running in circles?

The proposed four day week that was rumored in the 1970's has become the six day 70 hour work week for many of us and unemployment for others. Salaries have not kept pace with business growth so both household heads have to work. Employees suffer burnout as a record pace. Did someone say stress? All of this is caused by one trend.

Empires Over SatisfactionCorporate CEO's are more interested in Empire Building than Customer Satisfaction. Merging Corporations seems to be the new goal of the "head cheese." I know of some businesspersons who have left the same company several times only to return when the latest merger is announced. These major corporations are located in tier one cities for the most part and therefore good jobs are being sucked out of small cities at a record pace. This is why Enid is dying and the "mega"troplises are choking on their own consumption.

This devouring of the small town spirit is why gangs are becoming more violent as jobs in the heartland disappear and reappear in big cities. Mergers cause mass confusion on a corporate scale. People are displaced from their niche on both sides; buyer and buyee. The company expends resources on assimilation and consolidation rather than competition and quality. Mergers are sometimes a necessary evil. However, our government leaders seem blind to the effect on society as their approval is only a rubber stamp away.

ConclusionI would urge any politician reading this to think twice and read the facts before signing on the dotted line the next time you review a merger request. Stockholders beware: Not every merger is good. Consumers... drive past that national burger franchise and eat a Lotta Burger if you can find one.

Corporate Greed in America

2006-12-30T10:11:00.000+14:00

The Issue: Corporate Greed in America

The Facts:

$ While the average worker in America makes $25 thousand per year, the average CEO salary is $14 million and climbing.

$ These same, overpriced CEOs have shifted millions of American jobs overseas, where child labor, worker coercion and slave wages are the rule.

$ Due to tax cuts Republicans have doled out to their Big Business friends, corporate tax receipts are now only 7.4% of overall federal revenue.

$ In 2002, the CEOs of the 50 U.S. companies that laid off the most workers got an average pay raise of 44%.

$ In 2002, CEOs for the 30 companies with the biggest shortfalls in employee pension funds were paid 59% more than CEOs at other companies.

What Republicans Claim:

$ They say that agencies like the Securities & Exchange Commission should be controlled by the same corporations they are supposed to be regulating.

$ They say that taking huge “campaign contributions” and then writing laws that benefit those same “contributors” isn’t really legalized bribery.

The Truth Of The Matter:

$ Corporate compensation for all executives must be reported as a separate item in all financial statements.

$ Even though shipping jobs to countries with low wages is good for CEO stock options and bonuses, it’s bad for America and just plain wrong.

$ Corporate campaign contributions must be reined in and regulated.

Fun Facts To Know And Tell:

$ Until Enron went bankrupt and Ken Lay’s crimes were exposed in the media, Mr. Lay was extremely influential with the current administration.

$ Bush’s pet name for Ken Lay was “Kenny Boy!”

The great overpaid CEO debate

2006-12-30T05:45:00.000+14:00

Get Real

I don't mind CEO's making more than I do. What gripes me is when their salaries are in the millions and they are getting annual bonuses while at the same time I am being told that the highest annual pay raise I can receive is 4%, which is less than the cost of living increase. What planet do you live on?

Are CEOs overpaid? Many people think so.

Many potential causes of overpayment have been identified: CEOs with too much power, inattentive boards of directors, conflicts of interest by compensation consultants, the use of stock options--the list goes on.

Some studies show the average CEO was paid $10 million to $15 million in 2005. This includes their salary, bonus, stock option gains, stock grants, and various executive benefits and perquisites.

Are rank-and-file workers underpaid? Everyone, I suppose, feels a little underpaid. Some data sources indicate the average American worker was paid about $40,000 in 2005. Anyone working in the technology sector knows this average pay level would barely hire a below-average administrative assistant in any of the technology hot spots in the U.S. And the average CEO pay has been earned by more than a few average technology company workers who had stock options in the right company at the right time.

So, are CEOs overpaid compared to rank-and-file workers? If you read the media stories this year, and in previous years, you might conclude that they are. Some interest groups have determined that the ratio of CEO pay to average worker pay is an appropriate measure of this problem. Some Web sites allow you to calculate how underpaid you are compared with your CEO. According to these sources, chief executive pay is between 250 and 500 times that of the average worker.

If there is an excessive CEO pay problem, we won't fix the problem by measuring the wrong things and then misinterpreting flawed calculations.

Who are these CEOs who are purportedly paid hundreds of times more than the average worker? In most analyses, they are CEOs managing the largest public companies in America--usually the top 200 to 500. These are largest of the thousands of public corporations in the country. Given that executives typically earn more pay for managing larger organizations, we might expect these individuals to be at the top of the pay hierarchy.

It's more difficult to determine the relative value of the individuals in a job. Most CEOs I've dealt with are highly intelligent, have advanced degrees--often from one of the top universities in this country or elsewhere in the world--and have worked 70 or more hours per week for most of their career. Even if they weren't CEO of a public company, people with a background like that get paid much more than the average person.

Measuring worker pay If we want to understand the pay level of the average worker in America, we would have to ensure we included all forms of their pay--wage or salary, shift differential, overtime pay, bonuses, tips, commission, stock-based compensation, hiring bonuses, retention bonuses, and so forth. Without digressing into which data sources do and do not capture all of this (hint: none do), this would provide a good portrayal of how much the average worker is paid for his work. We would assume that this data reflects average performers with average levels of education, and so forth. But that's not the data that's being used in these comparisons.

I can't recall seeing a comparison of how much software engineers are paid compared with postal workers, or database administrators compared with bank tellers. This might mean that no one believes these would be relevant comparisons, because different jobs with different educational requirements and different levels of responsibility should be paid differently. We don't always know or agree how differently, but differently.

It still would be completely meaningless, however--just like comparing CEO pay to average worker pay.

I am in no way trying to serve as an apologist for high executive pay levels. After more than 20 years in the field of executive compensation, I have seen numerous examples of inappropriate pay for executives--not only in amount, but in reason and in form. Billions of dollars have been paid to thousands of executives who have destroyed companies and ruined workers' lives. I have seen executives join a company shortly before a takeover and get millions in "change in control" payments.

I also have seen numerous examples of inappropriate pay for nonexecutives--the so-called average worker. I have seen software sales representatives who made far too much commission due to a flawed incentive plan; a receptionist earning more than double the market rate because she had been with the company for decades, and there was no pay cap for any position; software engineers who joined a company at just the right time, and cashed out their stock options just before the stock price crashed and the company went out of business, due to a poorly developed software product.

Fixing the right problem If there is an excessive CEO pay problem, we won't fix the problem by measuring the wrong things and then misinterpreting flawed calculations. That only will encourage misguided legislation, and we've had plenty of that. It also might encourage big shareholders and their advisors to begin bullying companies into change using arbitrary standards, and we've had plenty of that, too.

Disclosure and publicity of pay allows us to identify the egregious situations and apply pressure to fix them, but only when the data seem accurate to reasonable people.

I just read that U2 made $260 million in gross receipts on their 2005 tour. That's $3 million per show (about $1 million per hour)--far above Motley Crue's $33 million for a similar number of shows (a paltry $400,000 per show, well under $200,000 per hour). I don't think most Americans want to impose an arbitrary cap on CEO pay any more than we want to impose a cap on U2's concert tour receipts because we know U2 would stop touring, and good CEOs would stop CEO-ing, and neither of those is to our benefit.

Let's focus on the real problem and not on concocted metrics rooted in sociopolitical sentiments. There is a lot of fixing needed in executive pay practices, and these average worker pay ratios have the potential to send us in the wrong direction.

Why Departing Executives Don't Deserve Lavish Deals

2006-12-30T05:41:00.000+14:00

Despite a rash of new corporate-governance guidelines, chief executives are still reaping huge severance deals, even when they are forced out.

Richard H. Brown, 55 years old, who was ousted in March as chairman and CEO of Electronic Data Systems, Plano, Texas, will receive severance totaling more than $32 million in cash and stock. The package will require the computer-services company to take a charge of six cents a share in the first quarter. EDS's share price, meanwhile, has fallen 75% in the past year as a push into the now troubled airline and telecommunications industries went awry. In addition, the Securities and Exchange Commission is investigating EDS's financial dealings and disclosures.

Milan Panic, 72, founder and decades-long CEO of ICN Pharmaceuticals, Costa Mesa, Calif., resigned in the summer of 2002 after his slate of directors was defeated in a proxy fight. He is still wrangling for a richer severance than is in his contract.

Under that agreement, he is entitled to receive a $5 million lump-sum severance payment and a $670,000 annual consulting fee for the remainder of his life. That is on top of the $33 million bonus Mr. Milan received in April 2002 after completing the sale to the public of a 20% stake in ICN's Ribapharm unit, which holds rights to a valuable drug used in treating hepatitis C.
Richard J. Kogan, 61, departing CEO of Schering-Plough, is entitled to receive $13.2 million in severance and $26.4 million in retirement payments when he steps down soon, despite a slumped share price and a pending SEC investigation at the pharmaceuticals company.
J. Harold Chandler, 53, fired recently as chairman and CEO of UnumProvident, the nation's largest disability-income insurer, will receive severance of $8.5 million and pension benefits of $8.5 million. Share price of the company, based in Chattanooga, Tenn., has plummeted in recent months as regulators question its claims-handling practices and investment portfolio.
Many of these severance deals, to be sure, were negotiated years ago when the CEOs were first recruited or promoted to the corner office, and can't be rescinded without a legal battle. "They are the residual effects of the boom years when CEOs were treated like star athletes and celebrities," says Carol Bowie, director of governance research services at the Investor Responsibility Research Center in Washington.

Yet corporate directors still haven't put the brakes on runaway executive pay and the practice of guaranteeing CEOs golden parachutes even before they prove their worth. They are out of step with investors and employees, who are angry over watching big payouts for sometimes inept performances, while their investments shrivel, their jobs are cut and they must leave their work with no package at all.

Their anger is showing up in a spate of shareholder resolutions aimed at restricting lush severance deals and seeking the right of investors to vote on golden parachutes.
Recently, Hewlett-Packard's shareholders narrowly approved a proposal urging directors to seek investor approval for any severance package valued at more than three times the executive's base salary plus bonuses. H-P said its board would "duly consider" the nonbinding recommendation, which is all it is required to do. CEO Carly Fiorina had opposed the proposal on the grounds that it could put the company's recruitment efforts at a "competitive disadvantage."
In March, shareholders at Tyco also passed a resolution seeking the right to vote on executive severance deals. Similar resolutions will be voted on soon at United Technologies, Citigroup and Alcoa. Ms. Bowie says she and her colleagues at the Investor Responsibility Research Center are monitoring such resolutions at a total of 18 companies this year. "It's a sign that boards are under more scrutiny -- but we're not yet out of the environment that anything goes when it comes to executive pay," she says.

More than limiting lush severance deals for executives, it's time to do away with them altogether. "If a prospective CEO on the way in to the job demands this, he or she may not be the right person to begin with," says Charles Elson, director of the University of Delaware business school's Weinberg Center for Corporate Governance.

He disagrees with Ms. Fiorina that eliminating severance will hurt companies' ability to attract executive talent. "I don't believe someone will turn down a top job offer because there is no guaranteed multimillion-dollar severance," he says. "Very few of us are assured that we will be paid for failure -- and directors have to start saying no, which takes some strength and independence."

That is what he and other directors at Nuevo Energy in Houston found when they recruited James L. Payne, 66, to become chairman, president and CEO two years ago. Mr. Payne, former vice chairman of Devon Energy, agreed to the take the job at Nuevo Energy without a severance agreement or other special perks. He also received Nuevo common stock, rather than cash, in compensation in 2002, equal to about $400,000 in salary and $200,000 in bonuses.

How Overpaid CEOs Can Hurt Employees !!!

2006-12-30T05:39:00.000+14:00

Too many chief executives still don't understand how they undermine investor trust and employee morale when they negotiate steep compensation deals for themselves, regardless of performance. And too often, directors go along with them, despite the current focus on corporate governance.

That is what dozens of readers said in response to my recent column on rich severance deals for recently fired CEOs. They offered thoughts on what must be done to restore trust in corporate management.

Here are some of their views.

All board directors know that the "necessary to recruit" argument (to justify executive compensation deals) is really bogus. There are lots of good managers, and a CEO's job is highly sought after.

There needs to be a serious effort to reverse the runaway growth of executive pay and pension schemes and, particularly, severance payments. It is just greed.
Who really deserves to earn more than a million dollars a year while their shareholders are getting poorer? A good start would be to ban interlocking directorships. Mutual back-scratching at our expense.

How do CEOs of big U.S. banks get away with paying themselves excessively while pleading "no contest" and paying hundreds of millions in fines for offenses that occurred while they were in charge? We, the shareholders, pay the fines and we should be able to penalize the management accordingly.

Charles BowenRetired CEOWilliamsburg, Va.

Are CEO's overpaid?

2006-12-30T04:50:00.000+14:00

Are CEO's overpaid?

Tyler Cowen has a NY Times column supposedly offering a "contrarian" take on the issue (also see his blog post).

Cowen's viewpoint is that CEOs are paid according to their value, and I don't see why that's contrarian because it's the standard line spouted by pro-free market people.

The proper way to understand CEO pay is to look at it as a winner-takes-all market. A small increase in ability, or luck, results in massively greater earnings. So whether or not CEOs are overpaid depends on how you define "overpaid." Winner-takes-all markets happen to be a naturally occurring phenomena, but if you define "overpaid" as meaning someone makes far more money than someone else without actually contributing any additional value to the economy, then yes, CEOs are certainly overpaid.

As I explained in my post about baseball and Atlas Shrugged, the loss of the world's top baseball players would have little effect on the economy, and the same would apply to the loss of the highest paid CEOs. Other people would step into their roles, and it's doubtful that there would be any noticeable ability difference between the two.

We don't even know how good the selection criteria are for CEOs. Maybe the skills and abilities needed to get hired are not the same skills and abilities need to do the job? In fact, it seems likely to me that in order to make the really big bucks as CEO one must focus on self-promotion at the expense of the interests of shareholders. So by the very nature of the selection process, the highest paid CEOs are inevitably not the best people for the job.

Tyler Cowen explains that CEO pay has risen with market capitalization of companies. Some commenters to his blog have asked why the CEO pay should rise based on external factors (such as the increase in the P/E ratios of all publicly traded companies) which the CEO has no contol over? If CEO pay is based on their contribution to the economy, then they shouldn't get any more money for doing the same job they were doing before. But in fact, CEO pay is not based on what they contribute, but rather what's available in the pool. So rising market capitalizations increase the amount of money available for CEOs to take from the pool. In the same manner, increased profits for baseball enable the best baseball players to earn more money even though their batting average hasn't changed. Increased box office revenues enable the most popular actors to make more money even though their acting skills remain constant.

It's certainly understandable for the average worker to feel that winner-takes-all compensation schemes are unfair, because the people at the top are gettinging paid for all the hard work of the people at the bottom who receive little benefit from the increasing fortunes of their employers.

Who's the most overpaid CEO? The most underpaid?

2006-12-30T04:48:00.000+14:00

Boston Business Journal - August 26, 2004

by Tom Witkowski

Boston Business JournalWe list the highest-paid CEOs and rank them according to how their company performed compared with their peers'

During the past three years, as Cognex Corp.'s annual revenue dropped 19 percent then climbed back to above its 2001 level, CEO Robert Shillman went home without a paycheck.

Shillman forfeited his salary for two of those years as Natick-based Cognex, which sells machine vision systems used in making semiconductors -- suffered through a chip industry slowdown, putting him among the five most underpaid CEOs in Massachusetts.

In a study of CEO compensation, the Boston Business Journal examined the 100 highest-paid CEOs in Massachusetts and ranked them according to the performance of their companies. The result appeared in our CEOs of Massachusetts supplement to the BBJ. It showed which CEOs were paid handsomely while running companies that did poorly last year -- landing those CEOs in the category of overpaid executives -- and also showed which CEOs were more modestly compensated while leading their firms to stellar heights, becoming the region's "underpaid" CEOs.

The criteria for the rankings compared each CEO's pay against that of the other top 100 paid CEOs. Then we ranked their companies' performances against each other. To determine whether a CEO was relatively overpaid, fairly paid or underpaid, we subtracted each CEO's pay rank from his or her company's combined performance rank to find a resulting pay/performance figure. See the chart below.

For example, Shillman's compensation put him among the top five underpaid chief executives in terms of pay vs. company performance: His company's performance was 30th out of 100 companies, but among the highest paid execs, Shillman was listed at 97 -- a differential of 67, a gap bested by only four other execs on our list.

The Cognex CEO's compensation last year totaled $574,295, most of it coming from exercised stock options. He also received a $21,450 bonus from the company. Shillman's most recent annual salary, $89,190 in 2001, is low compared to the six- and seven-figure standards set by his peers. His decision to go without that salary also sets him apart from his local corner-office colleagues.

Likewise, Candela Corp. CEO Gerard Puorro's compensation put him at the bottom of the list among the 100 highest-paid chief execs, yet his Wayland-based laser company's performance was near the top, ranked fourth in our performance index, which took into account revenue growth, return on equity and stock appreciation.

With comparatively low compensation in a year his company did so well, at $649,939, he was (relatively speaking) the most underpaid chief executive in Massachusetts. In 2002, Puorro recommended his salary be lowered as a cost-cutting measure. His salary was restored to its previous level last year as the company became profitable again. Exercising options

Exercised stock options were a portion of the compensation of many underpaid and overpaid CEOs in Massachusetts in 2003. Despite possible changes in corporate accounting that would mandate expensing stock options, executive pay experts said that those options remain part of companies' compensation plans for now. And in a year when the public markets were on the upswing, as in 2003, option grants from earlier years gave some CEOs the extra fuel to make it to the top of the pile of overpaid CEOs.

Vertex Pharmaceuticals Inc. CEO Joshua Boger went home with $2.1 million in total compensation, ranking him 34th on the list of top-paid CEOs. His Cambridge-based drug company, however, finished last as No. 100 in terms of performance. Boger realized $1.5 million from the sale of stock, on top of his $525,000 salary. But Boger also asked not to receive a bonus for the year, even though the compensation committee of his company's board of directors evaluated his performance as "excellent" for the year, according to the 2003 proxy statement.
"The committee and the full board of directors' subjective view of Dr. Boger has consistently been that he is an outstanding scientist who has demonstrated exceptional ability to guide the company and to manage well not only the company's scientific progress, but its strategic business efforts," the committee said in the filing with the U.S. Securities and Exchange Commission.

Arnold Zetcher, CEO of Hingham-based clothing retailer Talbots Inc., went home last year with $7.4 million in total compensation, $5.3 million of it from options exercised and $809,000 of it in bonus. When you consider the company's performance, that pay scale stamps Zetcher's ticket into the overpaid club.

When a significant portion of an executive's compensation comes from exercising options, the argument can be made that the return is partially compensation and partially a return on investment, said William Caporizzo, co-chair of the tax department with William Cutler Pickering Hale and Dorr LLP.

"The new accounting rules would argue that if we're going to expense options based on the value on the day it was granted, that's the compensation. Anything beyond that is more investment," Caporizzo said, referring to yet-to-be implemented rules.

Larry Liebenow, the chief executive of textile manufacturer Quaker Fabric Corp., has the distinction of being the most overpaid CEO in the state, according to our rankings, with the bulk of Liebenow's 2003 compensation coming from $2.2 million in exercised options.

Among the companies of the 100 top-paid chief executives, Fall River-based Quaker ranked No. 92 for its 2003 performance. Liebenow's pay, however, came in at No. 23 on the compensation list.

Boston-based State Street Corp.'s David Spina, with $7.1 million in compensation, was the No. 8 highest-paid CEO, and Boston-based Nstar's Thomas May, with $4 million, was the No. 14 highest-paid CEO. When the performance of State Street and Nstar is taken into consideration, both Spina and May were also overpaid: State Street's performance ranking was 67th out of the 100 and Nstar's ranking landed at No. 71, according to our research.

Despite the potential changes in how they account for options, companies are in a holding pattern and not making any sudden moves to eliminate stock options. Under today's accounting rules, options are not considered an expense, and thus, are a long-term incentive for an executive and still considered free for the company, experts said.

"Make the expensing happen and I think you'll end up with a more rational compensation environment that allows boards and executives to really evaluate the strategic usefulness of each instrument, without the problem that one of the instruments is free and all the others aren't," said Joseph Rich, Marlborough-based vice chairman of Pearl Meyer & Partners, which counsels boards of directors on compensation.

Change is coming, however. The current trend is toward offering executives a mix of stock options and restricted stock. An analysis of 2004 proxy statements by Pearl Meyer showed that executives last year took home 23 percent more in cash and restricted stock, although their total compensation fell.

CEOs are paid too much for what they do; too much more than their average worker

2006-12-30T04:43:00.000+14:00

CEOs Are Overpaid

From F. John Reh,Your Guide to Management.FREE Newsletter. Sign Up Now!

CEOs are paid too much for what they do; too much more than their average worker
Pay for Performance According to Business Week, the average CEO of a major corporation made 42 times the average hourly worker's pay in 1980. By 1990 that had almost doubled to 85 times. In 2000, the average CEO salary reached an unbelievable 531 times that of the average hourly worker.

"Pay for performance", tying executive compensation to the financial success of their company, has become very popular in the past decade. In the face of the largest bull market ever, that isn't surprising. It also isn't realistic. What CEO honestly believes that all or most of the appreciation in value of their company is due to their own talent?

ZD Net's Total Compensation Vs. Total Return To Shareholders chart (no longer online), shows that total return to shareholders was higher for many companies whose CEO compensation was under $500,000 than for companies who paid their CEOs multi-million dollar compensation.
Workers Unite The AFL-CIO Executive Paywatch site gives people a lot of information about what they consider "the excessive salaries, bonuses and perks of the CEOs of major corporations".

The site features a calculator that shows how your salary increase over the past five years compares to that of a CEO. They also give you tools to "take action to stop runaway CEO pay."
Is It Justified? John Mariotti, president and founder of The Enterprise Group, asks "CEO Pay: How Much is Too Much?" and answers the question himself. Citing Derek Bok, he points out that as business becomes more complex, the demand for top executives increases and thus they command greater and greater pay. He also noted that such huge awards do little to motivate these outstanding performers, who are generally more motivated by challenge.

Mike Hughlett, Staff Writer for PioneerPlanet, thinks the reason why CEO pay soars so high is that CEO's pay generally is set by the compensation committee, usually comprised of other chief executives.

Graef Crystal, writing for the San Francisco Business Times, Uses Steven Jobs, co-founder of Apple Computer to prove his point on CEO compensation: the composition of a CEO's pay package has nothing to do with his future performance and the CEO may not make all that much of a difference in whether the company is a success or a failure.

In her article "Lowering the Bar", WSJ writer Joann S. Lublin notes "Pay for performance? Forget it. These days, CEOs are assured of getting rich -- however the company does."
So Why Bother? CEOs are paid too much. It has minimal effect on their performance. It has no quantifiable effect on the performance of their companies. The only measurable effect is to drive an ever widening gap between the CEOs and the people they depend on to produce results.
It is up to us as Management Professionals to return some equity to compensation of upper management and the individual contributors while trust and respect between the two parties still can be salvaged. If we don't, worker motivation, and resultant innovation, will plummet.

The great overpaid CEO debate

2006-12-30T03:44:00.000+14:00

The great overpaid CEO debate

By Fred Whittlesey

http://news.com.com/The+great+overpaid+CEO+debate/2010-1014_3-6078739.html

Are CEOs overpaid? Many people think so.

Many potential causes of overpayment have been identified: CEOs with too much power, inattentive boards of directors, conflicts of interest by compensation consultants, the use of stock options--the list goes on.

Some studies show the average CEO was paid $10 million to $15 million in 2005. This includes their salary, bonus, stock option gains, stock grants, and various executive benefits and perquisites.

Are rank-and-file workers underpaid? Everyone, I suppose, feels a little underpaid. Some data sources indicate the average American worker was paid about $40,000 in 2005. Anyone working in the technology sector knows this average pay level would barely hire a below-average administrative assistant in any of the technology hot spots in the U.S. And the average CEO pay has been earned by more than a few average technology company workers who had stock options in the right company at the right time.

So, are CEOs overpaid compared to rank-and-file workers? If you read the media stories this year, and in previous years, you might conclude that they are. Some interest groups have determined that the ratio of CEO pay to average worker pay is an appropriate measure of this problem. Some Web sites allow you to calculate how underpaid you are compared with your CEO. According to these sources, chief executive pay is between 250 and 500 times that of the average worker.

If there is an excessive CEO pay problem, we won't fix the problem by measuring the wrong things and then misinterpreting flawed calculations.

Who are these CEOs who are purportedly paid hundreds of times more than the average worker? In most analyses, they are CEOs managing the largest public companies in America--usually the top 200 to 500. These are largest of the thousands of public corporations in the country. Given that executives typically earn more pay for managing larger organizations, we might expect these individuals to be at the top of the pay hierarchy.

It's more difficult to determine the relative value of the individuals in a job. Most CEOs I've dealt with are highly intelligent, have advanced degrees--often from one of the top universities in this country or elsewhere in the world--and have worked 70 or more hours per week for most of their career. Even if they weren't CEO of a public company, people with a background like that get paid much more than the average person.

Measuring worker pay If we want to understand the pay level of the average worker in America, we would have to ensure we included all forms of their pay--wage or salary, shift differential, overtime pay, bonuses, tips, commission, stock-based compensation, hiring bonuses, retention bonuses, and so forth. Without digressing into which data sources do and do not capture all of this (hint: none do), this would provide a good portrayal of how much the average worker is paid for his work. We would assume that this data reflects average performers with average levels of education, and so forth. But that's not the data that's being used in these comparisons.

I can't recall seeing a comparison of how much software engineers are paid compared with postal workers, or database administrators compared with bank tellers. This might mean that no one believes these would be relevant comparisons, because different jobs with different educational requirements and different levels of responsibility should be paid differently. We don't always know or agree how differently, but differently.

It still would be completely meaningless, however--just like comparing CEO pay to average worker pay.

I am in no way trying to serve as an apologist for high executive pay levels. After more than 20 years in the field of executive compensation, I have seen numerous examples of inappropriate pay for executives--not only in amount, but in reason and in form. Billions of dollars have been paid to thousands of executives who have destroyed companies and ruined workers' lives. I have seen executives join a company shortly before a takeover and get millions in "change in control" payments.

I also have seen numerous examples of inappropriate pay for nonexecutives--the so-called average worker. I have seen software sales representatives who made far too much commission due to a flawed incentive plan; a receptionist earning more than double the market rate because she had been with the company for decades, and there was no pay cap for any position; software engineers who joined a company at just the right time, and cashed out their stock options just before the stock price crashed and the company went out of business, due to a poorly developed software product.

Fixing the right problem If there is an excessive CEO pay problem, we won't fix the problem by measuring the wrong things and then misinterpreting flawed calculations. That only will encourage misguided legislation, and we've had plenty of that. It also might encourage big shareholders and their advisors to begin bullying companies into change using arbitrary standards, and we've had plenty of that, too.

Disclosure and publicity of pay allows us to identify the egregious situations and apply pressure to fix them, but only when the data seem accurate to reasonable people.

I just read that U2 made $260 million in gross receipts on their 2005 tour. That's $3 million per show (about $1 million per hour)--far above Motley Crue's $33 million for a similar number of shows (a paltry $400,000 per show, well under $200,000 per hour). I don't think most Americans want to impose an arbitrary cap on CEO pay any more than we want to impose a cap on U2's concert tour receipts because we know U2 would stop touring, and good CEOs would stop CEO-ing, and neither of those is to our benefit.

Let's focus on the real problem and not on concocted metrics rooted in sociopolitical sentiments. There is a lot of fixing needed in executive pay practices, and these average worker pay ratios have the potential to send us in the wrong direction.

4 ways you can fight greedy CEOs

2006-12-30T03:40:00.000+14:00

Don't just fume about grossly overpaid execs and other corporate scams. You can make a concrete difference. Here are the people to contact and steps to take to get reforms under way.

By Michael Brush

The boss has always made a bundle. In 1940, U.S. corporations paid their chief executives 48 times as much as the average worker, on average. No small gap.

But that doesn't come close to today's great pay divide. CEOs earned $11.3 million on average last year, a 27% increase from the prior year and a huge 262 times more than the average worker. Barry Diller, the chairman and chief executive of the IAC/InterActiveCorp (IACI, news, msgs), took home $295 million last year, including pay, bonus and options cashed in, according to the Corporate Library.

What's worse? The CEOs don't seem to see anything wrong with that type of compensation. Diller recently said critics of his pay and similar packages are "birdbrains."

The momentum of CEO pay, obviously, isn't headed in the right direction. But you don't have to be a Democrat to appreciate that the party about to take power may give the little guy a bit more say in how much the big guy gets paid.

In a minute, I'll give you a set of four steps you can take to help get executive compensation back under control. First, another quick look at why such action is needed.

According to the Corporate Library, a corporate governance research firm, here's what the five highest-paid CEOs made last year:

1. IAC/InterActiveCorp's Diller got $295 million.

2. Capital One Financial (COF, news, msgs) CEO Richard Fairbank got $249 million by cashing in options.

3. Nabors Industries (NBR, news, msgs) CEO Eugene Isenberg got $203 million in pay, bonus, cashed-in options and restricted stock.

4. Yahoo (YHOO, news, msgs) CEO Terry Semel pocketed $183 million in pay, cashed-in options and restricted stock.

5. KB Home (KBH, news, msgs) chief Bruce Karaz got $156 million in pay, bonus, cashed-in options, restricted stock and incentive grants.

If these kinds of giveaways to CEOs tick you off, you don't have to just sit and fume about it.
Congress, regulators and companies themselves are considering a slate of reforms that would go a long way to correct the problem -- and you can take several concrete steps to support these changes.

Here's a list of whom to contact (click a name to send an e-mail):
SEC Chairman Christopher Cox's office. (Click the name to send an e-mail to Cox.)
Your representatives in the U.S. House and Senate.

Rep. Barney Frank, D-Mass., who will chair the House Committee on Financial Services, and Sen. Chris Dodd, D-Conn., who will head up the Senate Committee on Banking, Housing and Urban Affairs next year. (Please, e-mail MSN Money a copy of whatever you send to any member of Congress.)

And here's my quick list of reforms that you can try and do something about:

Boot the directors The real culprits behind enormous salary increases for CEOs are boards that approve these egregious pay packages in the first place. So it's important to vote against board members on pay committees that let these bloated pay packages through. "Unless you boot off directors who agree to these outrageous pay plans, there is no way to stop it," says Nell Minow of the Corporate Library.

"Don't just discipline board members, change them," says Patrick McGurn, special counsel for Institutional Shareholder Services. Shareholders may soon get more power to do so -- but you'll need to support reform efforts aimed at getting greater "proxy access" for shareholders, as the reform effort is called.

The Securities and Exchange Commission recently sided with a company that rejected a shareholder proposal which would have given shareholders holding more than 3% of its shares the right to nominate board candidates. But a federal court has told the SEC to reconsider its ruling, which may give shareholders more say in policing boards that play too loose with corporate checkbooks.

Get a clearer view What you can do -- Step #1: Contact the SEC and tell them you support the rights of shareholders to use the corporate proxy machine to propose changes in the rules on how board members are elected. "This should be on top of the list," says McGurn. Tell your representatives in Congress, too, since they have the power to influence SEC policy. The case involves American International Group (AIG, news, msgs) and the American Federation of State, County and Municipal Employees (AFSCME), which wants the bylaws change.
The good news is that it will be much easier to see how much executives make come springtime, when companies file proxy materials -- the documents containing details of executive pay.
The SEC recently adopted rules calling for better clarity, and pay experts are expecting some big surprises. "That in and of itself will have a chilling effect," says Minow, "although these people seem incapable of embarrassment."

But there's still room for improvement in disclosure. One shortcoming is that the SEC doesn't require companies to reveal the targets (such as company profits, revenues, etc.) executives have to hit to receive performance-based pay. This is a problem, since options often account for the lion's share of bloated pay packages.

Outgoing UnitedHealth Group (UNH, news, msgs) CEO William McGuire racked up an awesome $1.6 billion worth of exercisable options and $174.9 million out-of-the-money options during his tenure at the helm. That's on top of a salary, bonus and "other pay" package worth $10.6 million in 2005 alone, according to the Corporate Library.

Unmask the consultants What you can do -- Step #2: Tell the regulators and your representatives that you want more detail about what targets CEOs have to hit to increase the size of their paychecks.

Companies hire compensation consultants to help determine how much to pay their executives. The question is whether that advice is objective. For instance, those same consultants try to get business from the companies to advise on their employees' retirement plans. If they give the CEO a healthy pay raise, does that help them land or keep other consulting jobs?
What you can do -- Step #3: Ask the SEC and your representatives to require disclosure of all relationships between compensation consultants and the companies whose executive pay packages they design.

Fantasy shareholding If you hold just $2,000 worth of a company's stock for over a year, you have the right to submit votes to fellow shareholders. "For $2,000 you get a seat at the table with the board of directors and the CEO," says McGurn. "It's like fantasy baseball."

You can't force companies to ask shareholders to vote on anything (see Step #1). One area that's strictly off limits: votes that would constrain management on day-to-day business decisions. (That's fair enough. You wouldn't want shareholders micromanaging companies.)
But you can get proposals that ask shareholders to vote on several changes that can improve the quality of boards and help reign in executive pay, says Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware.

For several years, for example, Bristol-Myers Squibb (BMY, news, msgs) shareholder Dundas Flaherty filed proposals that asked shareholders if they wanted the office of chairman and chief executive to be split. Having the same person in both roles, some critics say, compromises board independence. About 40% of shareholders approved the proposal each time, says Cornish Hitchcock, a Washington D.C.-based attorney who helped Flaherty. In 2005, Bristol-Myers Squibb agreed to split the jobs.

What you can do -- Step # 4: As a shareholder, ask companies to put pay-related reforms to a vote -- or at least be sure to look for pay-related proposals from other activist shareholders and vote "yes."

For example, watch for proposals asking you to vote against excessive golden parachutes, excessive pay packages and the compensation committee reports that justify them, says Hitchcock, who also advises Amalgamated Bank's LongView index funds on how to use shareholder proposals.

Elson says proposals that require majority voting for directors are crucial. This change means that directors have to get a majority of all votes cast to win -- not just the largest number among several candidates. This makes it harder for boards and managers to get a rubber stamp on their favored candidates when the broader shareholder base is apathetic.
There are, of course, other steps to take. And anytime you go head to head with a corporation, it can be an uphill fight. But with the political winds swinging toward shareholders' favor, now's the time to give it a try.

At the time of publication, Michael Brush did not own or control shares of companies mentioned in this column.

Overpaid CEO? Here's how to find out

2006-12-30T03:34:00.000+14:00

Is the chief of a company collecting a treasure he doesn't deserve? Here's how to peek at his paycheck -- and a standard to guide you.

By Michael Brush

Few injustices tick off our readers like corporate bosses who make too much money while their shareholders go bust.

One of my columns on the subject, "The 5 most outrageously overpaid CEOs," brought in a torrent of mail.

"No one person is worth several hundred times what the average worker makes," wrote one reader. Another likened juicy CEO pay packages to "legal theft from the shareholders."
But many readers had a more practical bent. "Thanks for your article! Not because we love to hate these guys, but because it gives us another tool to check before we invest," wrote one reader.

Whether you're simply interested in checking what your employer pays its chief or you're using executive pay as a variable in your investing strategy, there's a fairly easy way to discover what a CEO makes. Below, I'll give you a step-by-step guide in how to use that tool.

Who's watching the boss? Here's why investors should care: Corporate governance experts say that when boards dole out excessive pay to top execs, it is a sure sign that those boards aren't working hard enough for shareholders.

"The decision of what to pay a top executive is one of the best indicators of what a board is doing and thinking," says Ric Marshall, chief analyst at The Corporate Library, an independent research firm that provides corporate governance analysis. "A board that can't say no to top executives, or feels executives should be entitled to some level of compensation that is far above the median, is an ineffective board."

A recent study by Moody's Investors Service confirms Marshall's analysis. The study, called CEO Compensation and Credit Risk, found that excessive pay packages are linked to credit-default risk and credit-ratings downgrades.

Out-of-line bonuses and options grants were more telling than excessive base salaries, says Chris Mann, an author of the Moody's study. This makes sense, because highly paid CEOs tend to get most of their pay in the form of bonuses and options. So that's where you're likely to see the excesses, too.

A CEO with too much influence over a company's board has little incentive to work hard or make smart decisions, because he or she will be raking in millions regardless of how the company performs, concludes the Moody's study.

Do your own detective work As an investor, how do you gauge whether a board is overpaying a CEO? A complete analysis seems tough, since boards compensate execs with a dizzying array of base salaries, bonuses, options, severance packages and retirement plans. And then there are the perks, such as access to the company jet for personal use, or payments to cover pet grooming.

The good news is that you can get at a lot of basic information on a CEO's pay package by checking a single document companies file with the U.S. Securities and Exchange Commission. This is the proxy statement -- which is meant to update shareholders on the state of a company prior to its annual meeting.

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Finding the proxy is easy. Just go to the "company search" page at the SEC Web site, type in your company's name or ticker, and look for the Def 14A form -- the code name for the proxy.
Once you've opened the proxy, find the section titled "executive compensation." Here, you'll find a table laying out the pay packages for the five highest paid execs for the past three years.
As an example, let's take a look at the proxy for Cendant (CD, news, msgs). Cendant is a travel and real-estate services company whose Chief Executive Henry Silverman regularly comes under attack for getting paid too much as the shares of his company lag the market. Over the past two years, Cendant shares are up 10%, compared to gains of 20% for the S&P 500 ($INX). The stock price is roughly where it was in 1998.

On page 21 of the company's most recent proxy statement, filed on March 2, 2005, you'll find a table with all the major components of Silverman's pay package: base salary, bonus, options, restricted stock grants and "other" compensation.

You'll see that Silverman earned a base salary of more than $3 million each of the past three years, bonuses in the $7.8 million-to-$15.2 million range and "other" compensation -- like retirement plan and insurance payments -- of anywhere from $3.3 million to $5 million each year.

How much is too much? It seems like a lot, but how do you know for sure?

There are no hard and fast rules. But one way to size up a pay package is to compare it to what others in the industry got. Silverman received total direct compensation of $23.9 million last year, compared to a median of $4 million at 12 similar companies, says Institutional Shareholder Services, which advises institutional investors on proxy voting and corporate governance matters.

Since individual investors don't have access to industry averages, here's a basic rule of thumb. The Corporate Library gets suspicious whenever CEO pay packages are more than 20% above the median for similar size companies. "We have found that companies that pay more than 20% above the median are consistently the ones that end up in scandal, in an investigation or in bankruptcy," says Marshall.

To help you make the calculation, see the box below for a breakdown of the median level of pay -- including base pay, bonus, restricted stock grants, options and "other" pay -- at companies based on their market capitalization, thanks to Moody's.

Median CEO pay levels at U.S. companies, by market capitalization
Company market cap
Total Compensation
Bonus
Options
$250 million to $1 billion
$1,843,000
$254,300
$717,000
$1 billion to $3 billion
$3,133,000
$550,000
$1,419,000
$3 billion to $5 billion
$5,372,000
$850,000
$2,345,000
$5 billion to $10 billion
$6,199,000
$1,030,000
$3,155,000
$10 billion +
$9,389,000
$987,000
$6,176,000

Source: Moody's Investors Services

To be fair to Cendant, the board at that company has trimmed Silverman's pay package and taken steps to better link pay to performance. But ISS still thinks the package is excessive because pay-for-performance hurdles are too low, and his pay too high. "Over the past year, Cendant underperformed both its index and its peers. Yet, the company's CEO is one of the highest paid in terms of salary and in terms of bonus," says ISS. Cendant declined comment.
Watch the perks Though they don't cost as much as lavish bonuses and pay packages, excessive perks are another red flag. Perks are typically, but not always, summarized in a footnote to "other compensation" in the proxy.

The Corporate Library, for example, chides American Express (AXP, news, msgs), Cendant and Honeywell International (HON, news, msgs) for giving their CEOs from $100,000 to $200,000 a year to subsidize personal use of corporate aircraft. At Dominion Resources (D, news, msgs), Chief Executive Thomas Capps recently got $385,510 in tax reimbursements.

Sometimes, companies slip top execs nice perks but you can't find them in the proxy statement. The Corporate Library, for example, takes Colgate Palmolive (CL, news, msgs) to task for releasing its "Above and Beyond" perk plan as part of a quarterly statement in November 2004, even though most investors expect to find such information in the proxy. The plan offers 800 executives anywhere from $2,000 to $11,500 a year to spend on personal services including housekeeping, fitness center membership dues (plus the cost of personal trainers and running shoes), tickets for entertainment events, club membership, and even pet grooming.

Chief Executive Reuben Mark said that Colgate is frugal when it comes to perks -- forgoing extravagances like corporate aircraft or subsidized housing for top brass. He says the Above and Beyond plan was part of an overhaul of company perks that reduced spending on such goodies by over 50%. The $2,000 to $11,500 annual Above and Beyond payments to 800 execs is too small to warrant a mention in the company's proxy statement, says Mark.

Other companies mentioned in this column declined to comment.

Advance detective work Corporate-governance experts also like to dig into the details of severance packages and retirement plans -- often a back door way for boards to hand CEOs sweet reimbursement packages.

For severance packages, generally anything more than three times annual compensation is out of line, says Patrick McGurn, special counsel for Institutional Shareholder Services. Institutional Shareholder Services also dings companies if they offer top brass severance packages even when they are terminated for poor performance.
Special Coverage

MSN Money exposes bloated CEO salaries and compromised corporate ethics. Read about what impact it has on your finances and join the discussion in our message board. Click here to go to our special coverage.

It's a lot harder to figure out what's going on with executive retirement packages like deferred compensation or supplemental benefit payout programs. Some details are in the proxy statements, but they are "extremely sketchy," says McGurn. "It takes someone with a lifetime of experience to estimate what the potential payouts would be. We were hoping to get some rules from the SEC to force greater clarity, but we haven't seen them yet."
McGurn would also like to see the SEC force companies to provide what he calls the "holy cow" numbers. That's a simple set of figures that would make it easy for investors to understand the sometimes stunning total pay and benefits package. "We are not seeing a lot of companies provide that on a voluntary basis," laments McGurn. "We would love to see the SEC require it."
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column.

The 5 most outrageously overpaid CEOs

2006-12-30T03:30:00.000+14:00

Here’s the pantheon of execs whose paychecks soar while their companies suffer. Also: 5 who produce stellar results for a comparative pittance.By Michael BrushAll's fair, they say, in love and war. Not much is out of bounds when it comes to executive pay, either.Consider Michael Ovitz. Although stockholders sued, the one-time Hollywood superagent gets to keep the $140 million he was paid for 14 months of work as president at Walt Disney (DIS, news, msgs). A Delaware judge ruled in mid-August that Disney's board didn't breach its responsibilities in awarding the huge severance package.While the Ovitz payout may have been legal, it's the type of corporate behavior that costs investors millions of dollars every year. And it's not just a few spendthrift companies throwing good dollars after bad leaders. We scoured corporate regulatory filings and found plenty of examples of overpaid underachievers in executive suites. Ultimately, we came up with a list of the five most overpaid bad chief executives, and another of the five most underpaid good execs.

Start investing with $100.Explore ournew ETF center.Our goal was more than uncovering a few egregious examples of corporate largess. This was an exercise in finding out which boards are working for shareholders and which have lost sight of that mission.Fat pay, thin performanceRather than focus on single-year offenders, we rounded up -- with help from Standard & Poor's -- the worst performing stocks in the S&P 1,500 over the past several years. Then we looked for the CEOs with the fattest compensation packages -- including base pay, stock grants and the value of options awarded the chiefs, as calculated using the Black-Scholes model, a common tool for valuing options.We also asked S&P to help us find the CEOs who collect the least pay in exchange for the best performance.
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The worst offendersThe upshot: Some boards award breathtakingly large pay packages to CEOs even as the executives trash their shareholders’ investments. The worst:

Top honors go to Gary Smith at Ciena (CIEN, news, msgs). His shareholders have been virtually wiped out -- losing 93% in the past four years. His compensation over that period: $41.2 million.
Jure Sola, the CEO and chairman at Sanmina-SCI (SANM, news, msgs) collected $26.4 million during the past four years while Sanmina shares fell 78%. The bulk of Sola's pay came in the form of a performance bonus of $19.9 million, paid for hitting one recent quarter's targets.
Sun Microsystems (SUNW, news, msgs) paid Scott McNealy, its CEO, chairman and founder, $13.1 million a year over the past four years, even as Sun's shareholders lost 76% of their money.

Shares of supermarket chain Albertson's (ABS, news, msgs) fell 39% over the past four years. Despite this dismal record, Albertson’s CEO and Chairman Larry Johnston collected a total of $76.2 million in that time.

Under CEO Peter Dolan’s watch at Bristol-Myers Squibb (BMY, news, msgs), shareholders have seen the stock decline by 48% over the past four years. Dolan took home $41 million.“I feel nothing but contempt,” says Don Hodges, president of the Hodges Fund (HDPMX). “They pay themselves like they are rock stars.” Particularly irksome to Paul Hodgson, an analyst at the Corporate Library, an independent research firm that provides corporate governance analysis, was the bonus paid by Sanmina-SCI. Hodgson’s complaint: Performance pay should reward long-term results. But the Sanmina-SCI board handed out a huge bonus just because of good results in one recent quarter -- even as long-term investors suffered. Hodges thinks egregious pay packages may have more to do with oversized egos than any real challenges that come with occupying the corner office. He points out that Sun Microsystems’ McNealy, for example, earns 32 times President Bush’s annual $400,000 salary. “Their pay doesn’t have anything to do with the level of responsibility. And it doesn’t seem to have anything to do with how well they run their companies, either,” says Hodges. It’s getting worse, by some measures. The ratio of CEO compensation to pay for the rank and file was roughly 200-to-1 in the early 1990s. Now it's more than 450-to-1, says David Lewin, a professor at the UCLA Anderson School of Management. Worse, many average workers are now paid partly through bonus systems and stock options, meaning their livelihoods are tied to often-volatile company stocks. Many executives have similar incentives, but at a vastly greater scale. They win almost regardless of how their stocks fare. Boards gone badDoes this really matter to investors? You bet. The Hodges fund is up 35% a year, annualized, over the past three years. Hodges chalks up his good results in part to the fact that he deliberately avoids companies where there’s little connection between CEO pay and performance. There is some logic to this. “When you have a breakdown in the executive compensation process in which CEOs are receiving undeserved pay, it is an indication that there is a power imbalance in the boardroom,” says Brandon Rees, a research analyst with the AFL-CIO Office of Investment, which keeps a close eye on executive pay. “When you have a weak board of directors, that is where you have broader corporate governance breakdowns which can include accounting fraud," says Rees."The problems at Tyco International (TYC, news, msgs), Enron and WorldCom were all preceded by excessive executive compensation packages. They were a red flag for investors.”Weak governanceNo one is suggesting the companies on our top-five overpaid execs list are committing accounting fraud. But a few companies on our list get weak to lousy grades for corporate governance. Unfortunately, all but Bristol-Myers declined to talk with us.

Sanmina-SCI's corporate governance is worse than 93% of other companies in the S&P 500 ($INX), according to Patrick McGurn, special counsel for Institutional Shareholder Services, which advises institutional investors on proxy voting and corporate governance issues. Sanmina-SCI gets low grades for having a poison-pill anti-takeover mechanism. That protects management and the board, taking away an important shareholder tool -- the threat of an outside buyer -- for trying to fix problems like excessive pay.

Bristol-Myers’ board gets an “F” from the Corporate Library -- in part because of excessive pay that is not linked to performance, but also because groups of board members get voted on as panels in different years. Known as a “staggered board,” this makes it harder for shareholders to quickly kick out a board they don’t like. Bristol-Myers says it is taking steps to link executive pay to performance. The corporate governance watchdogs at ISS agree. But the company still has a long way to go, says Hodgson of the Corporate Library.

Ciena has lousier corporate governance policies than 95% of the companies in the S&P 500, says ISS. The company gets low grades for excessive options to top execs, a poison pill and a staggered board. Albertson's and Sun Microsystems are more friendly to shareholders, but you can’t really say they are shining examples. Each has better corporate governance than about half the companies in the S&P 500, says ISS.ISS gives Sun Microsystems credit for paying McNealy a minuscule base salary of just $100,000 from 2002 to 2004, at the low end of the scale for CEOs. It also says the board has done a commendable job of structuring McNealy’s compensation to focus on annual bonus and long-term incentives. Even so, last year McNealy took in over $7 million by exercising stock options, and the board granted him another $1.5 million in options.A better wayCan investors do more than vote with their feet? Activist shareholders sometimes fight overly generous pay. The AFL-CIO, for example recently submitted a proposal to Albertson’s shareholders asking for more performance-based pay. Another approach is to simply look for companies that have great performance and reasonably paid leaders. That’s a sign that boards and top managers feel a responsibility towards shareholders. Some examples:

Ceradyne (CRDN, news, msgs) paid CEO Joel Moskowitz an average of just $766,000 over the past three years, while Ceradyne's stock shot up 924%. The company makes ceramic components used in technology.

Whole Foods Market (WFMI, news, msgs) paid CEO John Mackey an average $645,000 a year over the past four years, while the stock gained 308%.

Jo-Ann Stores (JAS, news, msgs) paid CEO Alan Rosskamm $1.6 million a year over the past four years. The stock jumped 611%.

Hibbett Sporting Goods (HIBB, news, msgs) paid CEO Michael Newsome $969,000 a year over the past four years as Hibbett shares soared 553%.

Digi International (DGII, news, msgs) paid CEO Joseph T. Dunsmore $744,000 a year over the past three years while the stock advanced 320%.One sign of these companies' investor-friendly nature: Ceradyne, Whole Foods and Jo-Ann Stores use performance-based options and stock grants, says Hodgson. Jo-Ann Stores, he says, "is an example of a company that has so much faith in its executives, the board is willing to tie their long-term compensation even closer to performance.” Many of these companies are much smaller than the five on our worst-paid CEO list. So you might expect CEO salaries to be lower. But from an investor’s point of view, does that really matter when you are making 500% on a stock in four years instead of losing 93%?

At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column.

Unemployment Benefits

2006-11-18T08:05:00.000+14:00

You might be able to get unemployment benefits if you don’t have a job or work less than full-time.
What are unemployment benefits?Unemployment insurance is a program paid for by employers and your tax dollars when you’re working. If you lose your job and it’s not your fault, you could qualify for these short-term benefits.

How much can you get and for how long?The amount of benefits you get depends on how much money you made in the 12 months before losing your job. When you’re approved, you’ll get a check once a week while you’re looking for work.

How do you qualify?

What’s a base period?

How do you apply for benefits?

Can your benefits change?

Can you lose your benefits?
Do you pay taxes on unemployment benefits?

Job Loss Support Group

2006-11-18T08:03:00.000+14:00

Job Loss Support Group

This site will allow you to network with other people in similar circumstances as you, and find referrals to outplacement consultants, financial analysts and counselors. You can also download an e-book called:

A GUIDE TO: Coping with Job Loss for Smarties

The Emotional Aspects of Job Loss and How To Take Back Control of Your Life

Do you have COBRA Insurance Questions? We have the answers. Know Your COBRA Rights.

2006-11-18T07:50:00.000+14:00

Do you have COBRA Insurance Questions? We have the answers. Know Your COBRA Rights.

Is your COBRA insurance too expensive? Looking for a COBRA alternative? We have several options for you to quote and purchase online. Plans begin at $25 per month.

Between Jobs and need COBRA alternative?
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COBRA Insurance is a valuable tool in the COBRA insurance transition. We strive to make the COBRA Health Insurance process as smooth as possible, by offering alternatives, and education to every party involved.

Online Job Hunting Tough

2006-11-18T07:47:00.000+14:00

Most companies with Web sites allow people to apply directly for jobs online. But do those applications ever get anywhere?

Dan Zarling has doubts. Since being laid off in November from U.S. Bancorp Asset Management, the 40-year-old former senior equity analyst has applied for jobs through six company Web sites -- and found it frustrating at best, he says. The applications can be so complex that "it's almost like you're applying for credit," Mr. Zarling says. The feedback from companies, meanwhile, is spotty.

"Some of them you get zero response back from, and you kind of wonder, what did I just do?" he says. "There was no acknowledgment that you spent a half hour trying to get your information to them."

The unpleasant truth, according to job seekers, career counselors and even some companies, is that applying for jobs on corporate Web sites is often a complicated and frustrating process. A few companies do a majority of hiring via their online systems. J.P. Morgan Chase & Co., in New York, says 77% of its hires so far this year started on the corporate Web site, and that includes entry level jobs up to some vice-president positions. But the process tends to be cloaked in mystery for job seekers themselves, who often shoot their credentials into cyberspace without ever hearing anything back.

Mark Mehler and Gerry Crispin, who run CareerXroads, a Kendall Park, N.J., recruiting-technology-consulting firm, set out to test what the typical experience is like. They invented a fictional job applicant named Vinnie Boombotz (a long-time joke name favored by comedians). Posing as Mr. Boombotz, the two men recently applied to nearly 400 large companies.
Mr. Boombotz's resume was patently ridiculous. It described him as a C.P.A., or "certified protection associate" at "Bad-a-Bing Corporation," and stated that in his current capacity as a collections supervisor he had "eliminated turnover and competition." It was balanced with some plausible work experience, however, and was designed to slip past a computer without a sense of humor. Because of the specifications at individual companies, not all parts of the resume were submitted to each company.

It's unclear how many companies caught on. More than half spat out a curt but encouraging automated e-mail to Mr. Boombotz thanking him for applying. At least six suggested that he apply for specific openings. J.P. Morgan, for instance, identified Mr. Boombotz as a possible match for an opening for a fraud hotline analyst, while Merck & Co. informed him of an opening for a merchandise analyst in a similarly worded e-mail. Mirant, a global energy company based in Atlanta, saw him as a possible candidate for a payroll accountant's job and a senior accountant position, among others. Several companies rejected Mr. Boombotz for the positions he originally applied for, but encouraged him to apply for other openings in the future.

Applicants to corporate Web sites are met with silence for many reasons. The competition is often stiff, since automation allows job seekers to flood the systems, leaving many companies facing the task of wading through thousands of resumes a month, and making it all but impossible to provide any individual feedback. (Merck, for instance, gets 30,000 resumes every month.)

Job listings themselves are sometimes out of date. While the Internet originally promised more efficient connections, "where it does not live up to the hype is with actually connecting with the hiring managers with openings," says Nancy Collamer, a Greenwich, Conn., career coach and author of "Layoff Survival Guide."

Many companies use automated systems to scan resumes for certain key words to weed the ranks, but the systems are imperfect at distinguishing among candidates. Some targets of the Vinnie Boombotz hoax insist their automated recruiting systems work well and provided the right feedback -- even in the case of Mr. Boombotz.

"In Vinnie's case, he bid on a job and he was rejected by a recruiter," says Michael DeAngelo, manager of staffing programs at Merck. Mr. DeAngelo has tracked Mr. Boombotz's application and determined that three e-mails were sent to him: one acknowledging his interest in Merck; another rejecting him for a staff accountant position; and a third telling him that his profile, based on his career interests, matched another opening. Merck kept the resume in its database because it was a version that didn't contain some of the more humorous aspects and therefore wasn't instantly recognized as a hoax, Mr. DeAngelo says. The resume sent to Merck listed Mr. Boombotz's address as Greeneyeshade Place in Lotsamoola, N.J.

Mr. Boombotz received a similar string of e-mails from J.P. Morgan. "The technology did its job," says Marion Dino, a national staffing executive at J.P. Morgan. Candidate profiles are based on job skills and experience listed by candidates during the online-application process, Ms. Dino says.

"This guy was not offered positions," says James Peters, a Mirant spokesman. "The system is working, because eventually the human element would come into play."

Automated screening tools are a necessity today, say all three companies. More than 500,000 people have entered the J.P. Morgan candidate database alone during the past 18 months. For some sales positions, Merck can receive as many as 2,000 resumes, according to Mr. DeAngelo. "You can't run a business and try to fill that job and talk to everyone that wants a job," he says.
Indeed, all three companies' systems performed better than the dozens of others that didn't send Mr. Boombotz any acknowledgment at all (although it's impossible to know if any of those companies figured out the resume was a hoax).

Maintaining candidate profiles, as each company does, enables them to alert job seekers to fresh openings and allows company recruiters to build long-term relationships with highly qualified candidates, they say.

Some job seekers, however, complain that real-life recruiters don't enter the hiring process often enough. The black hole that eats up resumes sent to corporate Web sites has become a cliche of job seeking during the past few years.

Laura Levitan, 45, says she has applied to positions through 25 corporate Web sites since she started her job search in January. After receiving nothing more than an automated reply in each case, she has given up hope of ever landing a position online. "I've stopped," Ms. Levitan says. "If there's a company that I really want to work for, I will just network into it."

Automated systems aren't going away anytime soon, however. By allowing companies to staff their recruiting teams more leanly and make more hires without paying for ads or expensive search firms, the systems are incredibly cost-effective. Mr. DeAngelo says Merck has saved "several million dollars" over the past year by relying more on its corporate Web site to find candidates.

Mr. Boombotz is likely to suffer an indignity in comparison with his real-life counterparts: Candidates generally remain in company databases for six to 12 months, but Mr. Boombotz won't be so lucky.

"Since we now know that he's not a real candidate, we're rubbing him out," says Peter Kelly, a staffing relationship manager at J.P. Morgan

Take this job and shove it

2006-11-18T05:44:00.000+14:00

Take this job and shove it

I ain't working here no more

My woman done left and took all the reasons I was working for

You better not try to stand in my way As I'm a walking out the door.

Take this job and shove it I ain't working here no more

Ive been workin in this factory From now on fifteen years All this time I watched

my woman Drowning in a pool of tears And I've seen a lot of good folk die Who had

a lot of bills to pay I'd give the shirt right off of my back If I had the nerve to say

Take this job and shove it I ain't working here no more

My woman done left and took all the reasons I was working for You better not try

to stand in my way As I'm a walking out the door.

Take this job and shove it I ain't working here no more

Well that foreman, he's a regular dog The line boss, he's a fool Got a brand new

flat-top haircut Lord, he thinks he's cool One of these days, I'm gonna blow my top

And that sucker, he's gonna pay Lord I cant wait to see their faces

When I get up the nerve to say

Take this job and shove it I ain't working here no more My woman done left and

took all the reasons I was working for You better not try to stand in my way As I'm

a walking out the door. Take this job and shove it I ain't working here no more

Take this job and shove it

Learn how to negotiate your salary and benefits.

2006-11-17T10:22:00.000+14:00

Salary Negotiation Clinic

Learn how to negotiate your salary and benefits.

Everything is Negotiable
Be Your Own Agent
The Job You Want
Your Dream Deal Salary History
Negotiating Benefits Negotiating
Incentives
Raises and Promotions
The Performance Review
The New Salary Negotiation

The Job You Want

2006-11-17T10:20:00.000+14:00

The Job You Want

If you're looking for the perfect job offer, you might as well stop right now: there's no such thing. But armed with the right information, you can get a good deal in a good place. Negotiating the job you want begins after you’ve learned how to be your own agent - after you’ve answered the tough personal questions and researched the company thoroughly.

Listen and answer first, ask questions later

Like the salary negotiation that follows it, the interview is a two-way process. The interviewer is gathering as much information about you as you are about the company. And a good interviewer will allow you to do most of the talking, so learn the difference between a quick question and one that requires a longer answer. In addition to listening to your answers, the interviewer may also be paying attention to how you budget your time in the interview.

In leading the conversation, the interviewer will cover essential information about the company, the responsibilities of the job, and other relevant material. Assume that the interviewer will answer most of your questions before you ask them, but ask your own questions at the end if anything is left hanging. Feel free to take notes and refer to them later.

Whatever you do, don’t talk about money until the prospective employer puts a job offer on the table. Until then, you have to convince them that you’re a hot commodity. Once they’re convinced, they will pay the fair amount it costs to get you. Let them make the first offer. Some interviewers will put pressure on you to disclose your current earnings, in the interest of determining whether they’re in the right range. As your own agent, you should just keep stalling - remember that you are never required to give a salary history. Money talk is the subject of Part 4.

Steer toward a better job offer

If, in the middle of an interview, you realize the job isn’t right for you, you have a choice. You could continue the interview, wasting both the interviewer’s and your time. Or you could cut the interview short, leaving halfway through, and going home wondering "what if."
There is a third alternative. You could always try to steer the conversation toward something closer to the job you want, or encourage the organization to restructure the job so that it will appeal to you more. You have nothing to lose, especially if your skills are highly in demand. Companies with an entrepreneurial culture are especially likely to be receptive to this kind of win-win maneuver.

Focus on your contribution

As the agent of your own career, keep your focus on the contribution you can make to an organization. In the selling stage of your conversations with a prospective employer, you have an opportunity to show how your work will help create more value for the company and its shareholders. Your contribution will stand out if, in addition to meeting the basic criteria for the position, you also have added skills or experiences. Examples include a well developed network of contacts, direct industry experience, and specific technical expertise.

Check the fit

You might want to do research to find out what a company is like. You can also see for yourself, once you get to the interview, whether the company walks the way it talks. One way to judge what kind of candidate a company is really looking for is to ask some pointed questions, like:

* What kind of management style is most rewarded in this environment?
* How can I be sure I'm achieving the company's objectives here, as well as my own?
* How do you view work/life balance?
* Why is this position open? What happened to the person who previously held the job?
* What is the turnover rate for the position or department?
* How does the company communicate to its members? How often?
* When can I expect a performance review? What is the process?
* What professional qualities are most valued in team members?

Turn them into a buyer

The goal of the interview process is to make the prospective employer conclude not only that they want to hire you, but that you are exactly the candidate they are looking for. Every answer that creates this impression - every point you score in an interview - makes you more valuable to that employer, and thus more expensive. The interview not only sells your candidacy, but also lays the groundwork for the salary negotiation.

Also check out our job offer assessing tool, The Job Assessor, in order to compare job offers.

Everything is Negotiable

2006-11-17T10:17:00.000+14:00

Everything is Negotiable

It's all negotiable. Every new job - every performance review, in fact - is an opportunity to negotiate base salary, various kinds of bonuses, benefits, stock options, and other incentives that add to job satisfaction and provide financial security. Taking control of your job search before your job offer and conducting a smart search that takes into account more than just financial considerations can also lead to that elusive condition called happiness.

Are you prepared to negotiate for happiness? The negotiation process is an opportunity to define, communicate, and achieve what you want out of your job offer. But to get offered the right job that pays what you deserve, you'll need to do your homework. The first step in the
negotiation clinic is to understand the negotiation basics.

Negotiation requires gathering information, planning your approach, considering different alternatives and viewpoints, communicating clearly and specifically, and making decisions to reach your goal. In her book, Job Offer! A How-to Negotiation Guide, author Maryanne L. Wegerbauer describes how each party in a negotiation can fulfill specific needs and wants of the other party, a concept called "relative power." According to Wegerbauer, understanding your strengths and resources; being able to respond to the needs of the other party; and knowing your competition enable you to assess your bargaining position more accurately.

Learn the power factors

What is your power over the other side of the table? Relative power, Wegerbauer says, is a function of the following.

Business climate factors

- Overall state of the economy and the industry in which you compete
- Overall unemployment rate and the general employment picture
- Demand for industry- and profession-specific knowledge and skills
Company factors
- Profitability
- Position in the business cycle (startup, growing, stable, turnaround)
Hiring manager factors
- Urgency of the company's need to fill the position
- Decision-making authority
- Staffing budget
Applicant factors
- Other opportunities in the job offer
- Technical expertise, unique knowledge/skill set
- Resources (financial depth, networks, etc.)
- Level of competition/availability of other candidates
- Career risk of the job offer

Plan and communicate

A negotiation is composed of two major steps: planning (research and strategy) and communication (information exchange and agreement). In the planning step, get as much information as you can up front and, using both the company's written and unwritten signals, map your skills against what the company values.

Give it time

Timing is also important. Remember that the best time to negotiate is after a serious job offer has been made and before you have accepted it. Once you are clear about the initial offer, you can express interest and even enthusiasm, but ask for more time to consider the job offer. Wegerbauer suggests that this request is made "in light of the importance of the decision." Sometimes you can split up the negotiating session into two meetings: one to firm up the job design and responsibilities and the second to go over compensation and benefits. The key message here is not to make an impulsive decision. If they really want you, there's time.

Consider the alternatives

You should be prepared with a rationale for everything to strengthen your position. Counteroffers are an expected part of many negotiations, so be sure to remain flexible. Keep in mind that different companies can give negotiations more or less latitude. Smaller companies may be more flexible than large, bureaucratic companies. Unionized companies usually have very little room for individual negotiations.

Negotiate for a win-win

Remember that the negotiation is not about strong-arm tactics or win/lose. It is a two-way process where you and your prospective employer are each trying to get something you need. In a negotiation, you're both designing the terms of a transaction so that each of you will receive the maximum benefit from the final agreement.

Also check out our job offer assessing tool, The Job Assessor, in order to compare job offers.

Leave the khakis at home

2006-11-16T10:31:00.000+14:00

Leave the khakis at home

Today's job hunters must schmooze, glad-hand--and don business suits

By Joellen Perry

During the heyday of the "new economy" in the late '90s, job hunting took little effort. With unemployment at record lows and desperate firms wooing candidates with sky-high salaries and absurd perks, "anyone who could breathe, basically, could find a job," says Kirsten Watson, CEO of tech recruiting site HireTopTalent.com. Now, with a recession and a layoff-scarred labor force, job-search basics--from pounding the pavement to wearing a business suit--are back in vogue. The following rules can give you an edge in finding a job in today's crowded market:

PREPARE FOR THE WORST. About 2.5 million workers were laid off in 2001, the largest number since the government began tracking mass layoffs seven years ago. Even if your firm appears sound and your job secure, a shaky economy could spur unexpected cuts. "Accept that your job may not be safe," says Nancy Collamer, author of The Layoff Survival Guide, an E-book. "The reality is, very few people are indispensable."

Facing that truth can help you mitigate the mental and financial shock of getting the ax. For example, you might want to discreetly investigate your firm's severance policy and start padding your savings account to cover a potentially lengthy job search. And keep in mind that current business contacts are invaluable resources. "After you've been escorted out the door, all your files may be sitting in a desk you no longer have access to," says Collamer, who suggests keeping copies of contact lists at home.

MAKE NEW FRIENDS. Networking has always been the gold standard of job hunting, says Neal Rist, a senior consultant with career management firm Manchester Inc., who credits some 70 percent of successful job searches to personal contacts. Amid a jam-packed labor pool, says Rist, face-to-face meetings with folks who are hiring--as well as with friends, family members, and business associates who might know of openings--have never been more important. Expand your circle by joining professional organizations, attending industry trade shows, or doing pro bono work in your field. In November 2000, Ernie Villanueva, 43, a systems engineer in Mission Viejo, Calif., was laid off by Cisco Systems. Recently, a former Cisco colleague introduced Villanueva to a friend launching a traffic monitoring firm. Two months later, Villanueva was hired. "Even though I'd spent months applying to jobs, in the end it came down to who I knew," says Villanueva.

STOP SURFING. With thousands of employment Web sites boasting seemingly infinite job openings, it might be tempting to spend all day online zapping out resumes. But the proliferation of sites--and users--has created a resume glut for many employers, some of whom receive thousands of responses to each posting. A report last year from technology analysis firm Forrester Research showed that just 10 percent of job hunters who culled cyberspace leads found positions. So "you should spend 10 percent of your job-hunting time online," says Richard Bolles, author of the world's bestselling career guide, What Color Is Your Parachute?

REINVENT YOURSELF. Be open to career changes and new industries. "A controller is a controller," says Jim Boone, a top executive of recruiting firm Korn/Ferry International. "Many of the skills of that job are readily transferable to other industries." Highlighting such talent can help you make the transition from an ailing industry to, say, the thriving healthcare sector. Marketer Andrea Preziotti, 30, survived two Web site layoffs. By playing up her writing skills, Preziotti, of Brooklyn, N.Y., recently snared a temporary gig developing content for the Winter Olympics Web site. The job not only won her a trip to Salt Lake City but also supports her new goal of becoming a freelance writer. "It never would have happened if I hadn't expanded my idea of the kinds of jobs I was qualified for," she says.

BE YOUR OWN BOSS. Losing a job can give you the freedom to pursue a dream. Brian Orner, 41, and Frank Vallone, 39, former Nortel Networks marketers in Rochester, N.Y., who were laid off last year, decided to take the entrepreneurial plunge after months of fruitless job searches. Last October, using money from their savings, the two introduced PennyPlanes.com, a site that capitalizes on their childhood passion for aviation by selling model-airplane kits. "Business is going better than we ever could have hoped," says Orner.

DO YOUR HOMEWORK. The dot-com collapse and the recent Enron debacle illustrate the importance of researching a potential employer's background. Bone up on a company's financial health by reading newspaper articles on the firm and studying annual reports; call colleagues in the industry to suss out a firm's reputation. Start-ups require special scrutiny. "Take a close look at the firm's funding, at whether its board of directors is reputable, and at whether there's actually a market for their product," says Watson. Bonus: Armed with such intelligence, you'll easily ace the interview.

WHEN IN ROME. While many firms still deem Friday a dress-down day, "there is a bit of a backlash going on" against the anything-goes attire that characterized the dot-com crowd, says John Challenger, CEO of outplacement firm Challenger, Gray & Christmas. Don't be afraid to call ahead and discuss the appropriate garb for your interview to avoid a fashion faux pas.
TAKE WEEKENDS OFF. Finding a job should be considered a full-time endeavor, but don't underestimate the emotional and psychic strains of unemployment. "Job searches are loaded with rejection," says Manchester's Rist. "They're illogical, inefficient, and people are not always courteous to you." Choosing to while away a sunny Saturday morning can help you develop the thick skin a search will require.

STAY CONNECTED. Last July, Villanueva and fellow layoff survivor John Pollock, 49, decided to meet each week for a cheap lunch in Mission Viejo, Calif., to share job-hunting tips and travails. Word spread fast, and 80 people now attend their "Taco Tuesday" lunches. The atmosphere is deliberately casual--though recruiters sometimes show up--with many sporting Hawaiian shirts and shorts. "The job-search process is fraught with so much pressure and isolation," says Pollock. "But I leave every Taco Tuesday feeling renewed and ready to begin again."

How can you avoid wasting your time with an unprofessional recruiter?

2006-11-16T10:28:00.000+14:00

How can you avoid wasting your time with an unprofessional recruiter?

A recent college graduate has repeatedly run into such recruiters during his four-month job search. The 27-year-old May graduate from University of Notre Dame's Mendoza College of Business in Indiana has encountered several so-called contingency recruiters who claim assignments they haven't landed yet or pressure him to lower his expectations. (Retained recruiters partly get paid in advance of filling posts while contingency recruiters, who often fill lower-level openings, earn a fee only if their prospects get hired.)

Amid hard times, "a lot of companies aren't going to recruiters to place people, so the recruiters are struggling," observes the Hoboken, N.J., resident. "These people are commission-based, and sometimes I get the impression that they're lying the minute they start talking to you."
Many career experts say you can calibrate recruiters' level of professionalism by asking them a host of questions, such as: Is this a contingency or retained search firm? Do you have this search exclusively? How long have you had the search? Whom are you dealing with at the client? Do you have a "spec" or position description? How did you get my name? How long have you been in the search business?

Recruiters sometimes display unprofessional behavior during their initial approach. Mark Jaffe, president of Minneapolis retained search firm Wyatt & Jaffe, says some recruiters fish for information before deciding whether an individual should be a candidate or a source of prospects. "That communicates a lack of professionalism to me," he adds.
Be wary of disclosing too much personal information until you obtain concrete information about the pending hunt, warns Gary Kaplan, president of Gary Kaplan & Associates, a retained search firm in Pasadena, Calif. A contingency firm "might not really have a job order. But if they collect enough resumes that match the parameters, they have a better chance of getting a placement and a fee."

It isn't just contingency firms that fail to exhibit professionalism, however. There's "a certain amount of arrogance" among retained firms, too, says Mr. Kaplan. "I hear all the time from individuals that they never get feedback from a retained search firm and are left to dangle in limbo. It's unconscionable and not good business sense."
Even if a recruiter lacks an appropriate opportunity, you can still figure out whether he or she has your best interests at heart. Steven P. Cohen, an executive coach who teaches negotiation skills in Pride's Crossing, Mass., suggests asking about a vacancy better suited to your background or for an introduction to a fellow recruiter more knowledgeable about your field. "It's a sign of good faith," he says.

But any time a recruiter's style makes you uncomfortable in any way, "it's best not to waste a lot of energy trying to figure out what's going on and just move on," advises Nancy Collamer, a career consultant in Old Greenwich, Conn. "It's just best to find a few recruiters you can establish long-term relationships with."

Email your comments to cjeditor@dowjones.com.

Career Consultant

2006-11-16T10:24:00.000+14:00

Nancy Collamer M.S. - Career Consultant

Nancy Collamer, M.S. gained a nationwide following as the online Career Transitions Expert for the Oxygen Media Network. As the founder of Collamer Career Consulting, based in Greenwich, CT, she has built a clientele assisting clients through telephone coaching, workshops and publications.In addition to her appearances on Oxygen TV, Nancy’s advice has appeared in Redbook, US News and World Report, Ladies Home Journal, Fortune, Working Mother and the Wall Street Journal. Nancy’s workshop, “Part Time Careers for Full Time Mothers” was the subject of a feature story in the December,1998 issue of Working Mother magazine.She holds a M.S. in Career Development from the College of New Rochelle and a B.A. in Psychology from the University of North Carolina/Chapel Hill. Prior to establishing her private practice, she was the co-owner of an employment agency and worked as the Director of Human Resources for Air Express International Corporation, and as the Assistant Director of Personnel for Saks Fifth Avenue. She is a member of Working Mother Magazine’s Reader Panel, the Career Masters Institute, The Alliance of Work Life Professionals, the Career Coach Institute and the Westchester Career Counselors Network.

To learn more about Nancy's telephone consulting option - CLICK HERE

JobVent is the web site for anyone who has ever said 'I hate my job

2006-10-20T09:27:00.000+14:00

JobVent is the web site for anyone who has ever said 'I hate my job', or 'I love my job'. JobVent is the web site for people who are about to start a new job, and want to see what other people think of working there.If you've got anything to say about your job, post it on this web site. Try to keep vulgarities to a minimum. DO NOT call people out by name. Speak your mind, but please, do it tactfully. All postings on this site are anonymous, and will remain that way. So start writing reviews (there's nothing to worry about)!

I LOVE MY f*&%$#G JOB !

2006-10-20T09:20:00.000+14:00

THE LOST DR SEUSS POEM " I LOVE MY JOB "

2006-10-20T09:10:00.000+14:00

I Love My Job!

The Lost Dr Seuss PoemI love my job

I love the pay! I love it more and more each day.I love my boss, she is the best! I love her boss and all the rest.
I love my office and its location, I hate to have to go on vacation.I love my furniture, drab and gray, And piles of paper that grow each day!I think my job is really swell, There's nothing else I love so well.I love to work among my peers, I love their leers, and jeers, and sneers.
I love my computer and its software;I hug it often though it won't care.I love each program and every file. I'd love them more if they worked a while.I'm happy to be here. I am. I am. I'm the happiest slave of the Firm, I am.I love this work, I love these chores. I love the meetings with deadly bores.
I love my job - I'll say it again - I even love those friendly men.Those friendly men who've come today, In clean white coats to take me away!

New Offering from Off the Top: Offshore Politicians!

2006-09-01T08:46:00.000+14:00

We've listened to the voice of ordinary Americans, we've felt their pain, and we have an answer. Millions of you are frustrated with overpaid politicians who seem more interested in helping foreigners than in helping Americans. Your politicians seem to be looking out for the interests of illegal immigrants, Arab sheikhs and oil barons, third world nations, and so forth, and it's costing you billions of dollars, lots of US jobs, and even American lives. Some of these politicians take huge bribes from foreign groups like the government of Red China or Arab sheikhs, serving as middlemen between the United States and foreign interests. And we're all sick it! We must put an end to this wasteful and corrupt practice of politicians as middlemen for foreign powers!
Now, with Off the Top's exclusive Offshore Politicians service, you can CUT OUT THE MIDDLEMEN and GET THIS CORRUPTION OFF OUR SHORES! When your state, city, or nation signs a contract for our Offshore Politicians service, we will immediately downsize the targeted politicians and replace them with low-cost offshore politicians who can directly represent the same foreign powers "in broad daylight" without the need for corrupt shenanigans and secretive deals.

Your offshore politicians will work less than a tenth of what onshore politicians demand, and will still feel filthy rich. We eliminate the wasteful and distracting election process, and instead simply appoint qualified representatives on the same relatively random basis that we use to select offshore executives for companies.

Plus, there is an added bonus! Because your offshore politicians will be scattered over the globe, communication between politicians will be hindered--not to mention the language barrier that comes from their puzzling varieties of English (though you can receive fluent English speakers for an extra fee, if you really need it). Communication barriers means less conniving among politicians, less corruption, and less tinkering with federal law. If enough states use our service, Congress may never be able to raise taxes again! This means more money in the pockets of every American!

Off the Top, Inc. proudly offers placement for offshore executives and offshore politicians. Working together, we can make the world a better place by taking a little off the top. Take a load off your company and keep a load in your vaults by taking a little "Off the Top."

OffShoreExecutive.com - New! A sister organization working closely with Off the Top to save your bottom line. Other businesses would denounce the competition, but since there is more than enough executive offshoring waiting to be done, we welcome it.

Pointless, Inc. - an example of a misguided company that resfuses to offshore their CEO.
Beam back to Jeff Lindsay's planet

The Information Technology Professionals Association of America - a group concerned about exporting of US jobs.

Zazona.com - interesting materials about the H-1B visa program and the loss of American jobs.
List of J.L.'s humor pages

Index to all of J.L.'s pages

Save Big Bucks with a Little "Off the Top"!

2006-09-01T08:45:00.001+14:00

For years US companies have learned the benefits of exporting jobs overseas. It is now standard practice to "off-shore" positions such as technical support, customer service, manufacturing, computer programmers, and even lawyers, allowing high-paid employees to be replaced with employees who are virtually free, sometimes being paid just pennies an hour more than actual slave labor. It's a bonanza of economic prosperity for those who boldly offshore, and financial ruin for those who do things the old-fashioned way.

Now offshoring has come to the ranks of senior management, even CEOs! That's right, with Off the Top, Inc., your company can slash costs like never before. Why pay $10 million for an executive, even an honest one, when you can hire an offshore CEO for as little as $1 a day--and get somebody who knows what he's doing and does it well! No secret deals to enrich a pal on the board; no insider trading--just honest, hard-working professionals. Fire that CEO and hire a replacement from India, Pakistan, Outer Mongolia, or Burundi--just a few of the many countries who provide offshore CEOs for our exclusive service.

We know our service is not for everybody. Some CEOs really do earn their pay. But for hundreds of corporations, like all the would-be Enrons of America, executive offshoring might just be the best business decision you ever made.

Offshore Executives:Cheap as They Can Be!

Senior executives! CEOs! Make your company more lucrative than ever before by taking "a little off the top"! Off the Top, Inc. brings the financial beauty of "offshoring" to the ranks of executives! Let us show you how to save your company millions of dollars, improve Corporate performance, and gain the respect of all your employees.
No more guilt over trashing the jobs of your loyal employees: now you can save REAL MONEY by trashing your own job and getting a low-cost overseas employee who may do your job even better than you. The offshore executives we provide are bound to be hardworking and honest, because if they are not, they'll be executed. Maybe their entire family. Simple as that!

Cutting Costs by Offshoring Top Executives

2006-09-01T08:42:00.000+14:00

JeffLindsay.com, through its partnership with Off the Top, Inc., is proud to be the first major US corporation to adopt "executive offshoring." This is bound to be the hottest new trend in business: exporting the jobs of upper management to low-cost developing nations to cut costs AND (in many cases) improve the quality of executive performance.

Because we were so impressed with the premium "Offshore Executive" service we obtained with Off the Top, Inc., JeffLindsay.com is pleased to provide a little publicity for Off the Top in the form of this Web page. (We also get 30 cents a day taken off the salary of our new offshore CEO.)

Our former overly compensated CEO, Jeff Lindsay, explains his impressive and trend-setting decision:

After years of futile cost-cutting efforts, I realized that my salary as CEO of JeffLindsay.com was more than the combined salary of all my programmers, customer service specialists, technical support staff, artists, humorists, and custodial staff, all of whom I had worked valiantly to offshore or simply downsize. But it was not enough. Then I ran into the good folks at Off the Top, Inc. during a cost-cutting/downsizing workshop in Hawaii. They were happy to help, and charged a lot less than you might expect (half the going price for outside consultants: about 25% of our revenues for the next five years). I saw that if I really wanted to cut costs and be fair about it, my own job had to be put on the chopping block of offshore placement.

But could an offshore candidate be found who would be willing to take on the stress of an executive lifestyle, make the myriad decisions demanded of my job, and achieve the same levels of success that I had? The good folks at Off the Top gave it to me straight, and I'll never forget their words:

"Sure, why not? Frankly, you haven't done much for your pathetic corporation, Mr. Lindsay. A crash dummy could have done better. But we can find someone willing to work hard, someone willing to take risks, someone who can inspire others with his stories of adventure, and someone with even better looks than you could ever hope for. And all this for just $1.50 a day!!"Ouch! The truth can really hurt, but in the end, it healed. (I'm still not convinced that a crash dummy could have done better - but to be safe, we added a couple to our board of directors.)
The leaders of Off the Top then flew me to Nepal, where I met the ideal candidate for my job, Jeferu "Shep" Linsee, a mountain climber, indigenous accountant, mystic, and local business man who raised goats and occasionally helped haul supplies up the sides of Mount Everest during the tourist season. He had more inspiring stories to tell than any overpriced motivational speaker we had ever brought in to our corporate activities. He could even speak some English. And with those dashing good looks and rugged manliness, I knew the press and the analysts on Wall Street would love him.

Training my future replacement was hard, but I knew it was the right thing for my company. My life as a CEO was over. Fortunately, I was able to find work with another local company, and while my salary is only a tiny fraction of what a typical CEO makes, I feel good knowing that "Shep" is doing better than I ever did and doing it each day for less than the cost of a hamburger with fries. And there you have the story of JeffLindsay.com, the first major US corporation to adopt Off the Top's fair, humane, and cost-effective practice of offshoring its senior executives. And now, we present some information prepared by our friends at Off the Top.

Workers asked to train foreign replacements

2006-09-01T07:42:00.000+14:00

Workers asked to train foreign replacements

By Stephanie Armour, USA TODAY

When computer programmer Stephen Gentry learned last year that Boeing was laying him off and shipping his job overseas, he wasn't too surprised. Many of his friends had suffered the same experience.

What really stunned him was his last assignment: Managers had him train the worker from India who'd be taking his job.

"It was very callous," says Gentry, 51, of Auburn, Wash., a father of three who is still unemployed. "They asked us to make them feel at home while we trained them to take our jobs."

More cost-cutting companies are hiring workers in other countries to do jobs formerly held by U.S. employees. But in a painful twist, some employers are asking the workers they're laying off to train their foreign replacements — having them dig their own unemployment graves.
Almost one in five information technology workers has lost a job or knows someone who lost a job after training a foreign worker, according to a new survey by the Washington Alliance of Technology Workers. The study is the first to quantify how widespread the practice is.
Here's what typically happens: U.S. workers getting pink slips are told they can get another paycheck or beefed-up severance if they're willing to teach workers from India, China and other countries how to do their jobs. The foreign workers typically arrive for a few weeks or months of training. When they leave, they take U.S. jobs with them. The U.S. employees who trained them are then laid off.

Employers say they need workers to train replacements to ensure a seamless transition, but the practice is coming under fire.

In a congressional hearing in February, some lawmakers denounced the training of replacements as "unconscionable."

Seven in 10 information technology workers say they would support legislation requiring companies to inform local officials if they plan to use U.S. workers to train foreign replacements, according to the survey by the Washington Alliance of Technology Workers, known as WashTech.

"This is the global economy hitting home," says Marcus Courtney, president of WashTech, a union representing technology workers. "It raises serious moral issues. Maybe we need to look at banning this practice outright. For American workers, it's a terrible situation to be in."

Transferring knowledge

Some employers say they're hiring workers in other countries — a trend known as "offshoring" — because they can pay lower wages, providing a much-needed competitive advantage. They say U.S. workers aren't forced to train replacements (known as "knowledge transfer"), but are given the choice whether to participate.

At WatchMark-Comnitel, a telecommunications software company in Bellevue, Wash., 17 employees in quality assurance were laid off in 2003, and replacements in India were hired. Sixteen U.S. workers helped train their replacements. Company officials say no workers were forced to do the training, but those who did got extra incentives.

"It was a voluntary choice they had to participate," says WatchMark-Comnitel spokeswoman Sherry Toly.

"Separation packages were offered whether they participated or not. We've been very happy (with the offshoring), and we feel we have a better product. Lower costs have transferred to an improved product."

But workers such as Myra Bronstein aren't convinced.

On a Friday in 2003, the former WatchMark software tester was part of a team of workers summoned to a meeting. There, she says, managers handed out letters explaining that the testing staff was being laid off. Managers then told the group that their replacements would be workers in India, she says. The workers were flying in and would be in the office Monday. She says she was instructed to train them.

Bronstein felt trapped. She says she believes that if she refused, she would have probably been fired without severance and would have been ineligible for unemployment benefits. If she quit, she says, she wouldn't have received severance or been eligible for unemployment.

The next week, she and the other employees facing layoffs were introduced to the workers who were taking their jobs. The workers from India, she says, would be earning a sixteenth of what she had been paid.

"I was staring hard at my shoes and trying not to cry. It was hideously awkward. I felt forced," says Bronstein, 48, of Mercer Island, Wash. She is still unemployed. "It was very deflating and dehumanizing to train your replacement. I felt sucker-punched. It was as if they handed us a shovel and said, 'Here, dig your own grave.' "

Is issue overblown?

While some economists and policymakers say there's no question that training replacements is difficult, they also say attention to the issue is overblown. Because this is an election year, they say unions are focusing on the issue as public sentiment turns against the loss of U.S. jobs overseas.

"Training your replacements is a pretty crappy thing to have to do. But it helps personalize the issue. It makes people empathize," says Bruce Bartlett, a senior fellow at the Dallas-based National Center for Policy Analysis. He says fears about job loss are "grossly overblown. It's always easy to blame foreigners."

Starting March 24, the AFL-CIO took workers who've felt the impact of unemployment on a "Show Us the Jobs" tour from St. Louis to Washington. The workers arrived last week in Washington to meet with members of Congress. Several of the 51 riders on the tour are jobless workers who say they had to train their own replacements.

Pat Fluno, 54, one of the bus riders, is a computer programmer in Orlando. Slightly more than a year ago, she was told workers from India would be taking the job she held with a German conglomerate. She says she was given a bonus to do the training and severance.

"It's insult to injury," Fluno says. "It's abuse. I think it's disgusting. I'm not pro-Bush or pro-Kerry. I just want the candidates to hear what's happening."
She says the training took about two months.

Employees forced to train their replacements say the practice is a stark illustration of how the hiring of foreign workers is plundering U.S. jobs. In the next 15 years, American employers will move about 3.3 million white-collar jobs and $136 billion in wages abroad, according to Forrester Research. That's up from $4 billion in wages in 2000.

In 1998, Darrell Rathburn says, he was asked to train his replacements at a high-tech company, but the software developer says he quit voluntarily after training them.

"Their salaries were about a third of ours," says Rathburn, of Columbus, Ohio. "They returned to India, and my project was given to them. There are so many people out of work who are very qualified. This is not right. This is not fair."

Hurting morale and image

While some say they feel bitter toward the foreign workers who are getting their jobs, a number of workers who've trained their replacements save most of their antagonism for their former employers. Thirty percent of employers said offshoring has hurt morale at their companies in the USA, according to a March survey by benefits consultants Hewitt Associates. Eleven percent say it has had a negative impact on brand image.

Scott Kirwin, a computer consultant in Wilmington, Del., was a contract worker for J.P. Morgan Chase for about three years when he was told he was being let go. He says the contract was ended so that Indian workers could replace him. He was asked to train the replacements, he says, in order to keep getting a paycheck.

"You feel like you're the guy wearing the red shirt on Star Trek," says Kirwin, referring to characters who often died on the TV show. He helped train his replacements in 2002. "It's a very unpleasant situation. It's unfair. These people appeared, and they'd sit and shadow us and watch what we do."

Kirwin has taken action, setting up the IT Professionals Association of America, which is aimed at raising awareness about offshoring and job issues. Web site visitors (www.itpaa.org) can order a T-shirt that reads, "My job went to India and all I got was a stupid pink slip."
J.P. Morgan Chase declined comment.

Lobbying for protection

Union members have been lobbying for legislative protections, from more restrictions on visas to guarantees that workers who quit instead of training foreign replacements will still get unemployment.

A bill introduced in Olympia, Wash., would have required employers to give employees advance notice before asking them to train foreign replacements. The bill didn't pass this year, but the sponsor, state Rep. Zack Hudgins, says he plans to bring it back.

"It's a terrible thing to ask someone to train their replacement and ship the job overseas," Hudgins, a Democrat, says. "This is way beyond election-year politics. It's a shift in our economy. It's not a partisan issue."

Many feel powerless. In 2003, Kevin Flanagan was laid off from Bank of America after training foreign workers. He shot and killed himself in the parking lot in Concord, Calif.

His death galvanized other information technology workers, who have staged protests against outsourcing. Members of Congress opposed to the practice also have used his case as a call to action.

"We were very saddened by the death of our associate," says Bank of America spokeswoman Mary Waller.

"Our thoughts and prayers went out to the family and co-workers. ... We determine the best way to transition processes so services are maintained."

When transitions occur, the company says it gives employees help finding work or assistance with finding another in-house position if possible.

The bank also has training opportunities. Bank officials say the positions that have been moved overseas are less than one-half of 1% of their total workforce of more than 180,000 employees.
But now, around the one-year anniversary of Flanagan's death, his father, Tom, still copes with the loss.

"Kevin losing his job with Bank of America was the defining event in his decision to end his life. Certainly there were other issues, demons, with which he was unable to cope," Flanagan says.
"Outsourcing isn't new, (but) now white-collar jobs are being lost.
"Why? Money, of course."

Teaching overseas workers how to appear American

2006-09-01T07:39:00.000+14:00

By Angie Wong

On the first day of class in a new office building in Mumbai, India, Brinda Surendar, an "American accent and culture trainer" who teaches overseas workers how to speak and behave like Americans, shows potential Indian customer service employees an episode of the TV show "Friends."

The show is meant to offer an example of how Americans live and behave for students who have never been to America but who have to learn about the culture to work as telephone customer service representatives in India.

Surendar received her undergraduate degree in English from SUNY Albany two years ago and teaches her students, mostly in their early twenties and many of who hold graduate degrees, American Culture 101. Her class is aimed at helping the students secure jobs at leading outsourcing companies like India's TransWorks, which has a roster of U.S. clients that include the top five banks on the Fortune 500. The company, with headquarters in Bangalore and Mumbai, expects to triple its workforce by May 2005 to meet the growth in outsourcing.
To get these highly desirable jobs, candidates must not only be fluent in English, they must also be fluent in how Americans speak and act.

At a time when job security weighs heavily on the minds of many Americans, and when many workers are outraged about service jobs being shipped abroad to low wage workforces in Asia and throughout the developing world, it is ironic that some Americans are making a living teaching Indian replacement workers how to appear more American.

According to CNN's "Moneyline," 2 million American jobs have been lost to outsourcing to countries like India since 2001. Unlike outsourcing in the 1980s, which mostly involved manufacturing, a large sector of today's lost jobs are customer service positions that demand person-to-person contact because the workers have to interact directly with phone clients.
Companies like TransWorks, which handle technical phone support and telemarketing services for such companies as Microsoft and Citibank, are popping up all over India's version of Silicon Valley. They are creating hot new real estate areas like the new Prestige Blue Chip Park in Bangalore.

The demand has created a hiring frenzy, but finding employees who can speak and understand the way Americans talk is difficult. Many American training centers have opened in response.
Surendar, for example, runs a 14-day training course at TransWorks in Mumbai to teach potential telephone customer service employees how to erase the singsong quality of Indians speaking English. She also familiarizes them with American foods, pop culture and current events. She says the training days are filled with voice exercises, history textbook memorizations and culture tests. In order to keep her students attentive after a nine-hour day, she screens videos like "Bruce Almighty," "Charlie's Angels" and "Something about Mary" as examples of American life.

Surendar recognizes her students' reluctance to use American slang and phrases. "You have to remember, I'm asking highly skilled professionals to role play Jim Carrey, and some of them feel like fools," Surendar says.

She says the most difficult part of the process is getting students to retrain their mouth muscles. "American phrases are big and drawn out, whereas Indian speakers are used to speaking quick, closed-mouthed," she says, "My students are not used to opening their mouths so much."
After the intensive training course, potential employees cram for the job-placement test, which includes reading a passage filled with rolling R's (a sound Indians have trouble pronouncing) and knowing every abbreviation for each state in America and the most recent sport scores of the Oakland A's baseball team.

"I didn't even know who the A's were until someone told me," says Anne Cooke, an American linguist and independent trainer based in Los Angeles. She has been training Indians how to speak and be more American for companies like General Electric and Dell since the early 1990s. After living in Paris, Madrid and Tokyo, Cooke started an accent correction business.
According to Cooke, some call centers will filter the service representative voices to sound lower than they actually are through the headsets to help "disguise their ethnic pitch."

Indians "tend to speak English at a really high pitch and they tend to snip off the end of words, which, when they speak, appears like they are being short-tempered with you, even when they don't mean to be," Cooke says. She teaches Indian executives to lower their voice and relax their speech to sound more "authoritative and confident" when dealing with Westerners.

"A slower, lower voice is a great way to combat a testy phone client who wants to vent," Cooke tells her students when dealing with clients who just want to take out their anger over the phone.

They are also taught to be more assertive. "My students think I'm teaching them to be rude," Cooke says. "I believe I'm teaching them to be more direct." Employees are encouraged to practice the American language and mannerisms outside the workplace to make them second nature.

It's especially disconcerting to learn that Indians disapprove of the way Americans speak, Cooke says. One of Cooke's students told her that his father would throw him out of the house if he talked to him in the fashion he was being taught in her class.
Cooke says Americans tend to compound words and "hiccup phrases" like "t'was," as in it was, and "jeet," as in did you eat.

Not only do they need to perfect their American speech, they also need to perfect their American attitudes. One of the biggest challenges Indian customer service reps have is showing sympathy to customers. "Many Indians come off sounding very robotic" when speaking English, Cooke says. "I teach them to add a sigh or an 'Oh, I understand your situation' to offer customers an ear of sympathy, which makes the whole customer service experience much more enjoyable."

TransWorks also has British clients who outsource telephone customer service jobs to India. "We have dedicated a selection of our employees to support our U.K. clients," says Abhay Chauhan, assistant vice president of business development at TransWorks. "They are trained to speak with British accents." Many Indians applying to work for a British company via TransWorks believe they already understand British culture and speak with a British accent because they had a connection with the English when the British occupied India. "They think they speak with a British accent, but they don't," says Cooke. "We have accent trainers for that, too."

(((aw2148@columbia.edu)))

Outsourcing: training your replacement

2006-09-01T07:34:00.000+14:00

Economists say eventually more jobs to be created for U.S. workers

By Andrea Mitchell
Chief foreign affairs correspondent
NBC News
Updated: 7:59 p.m. ET March 5, 2004

In Mayfield, Ohio, a Cleveland suburb in a critical election battleground state, Ed Lucas has run out of unemployment benefits and most of his savings.

Until last April, he was earning $80,000 a year working for an engineering firm, running computer systems for British Petroleum.

But he says BP found a computer manager in India willing to do the job for less than $10,000 a year.

Ed’s final assignment was training his Indian replacement: “It was just like somebody actually put their hand in my chest and ripped my heart out. It was just the worst feeling anybody could have.”

Ohio has lost 227,000 jobs in the last three years, many of them high-tech jobs outsourced to low-wage countries.

That information is red meat for Democrats, who rallied Friday at the U.S. Capitol. “We will not allow these jobs to go overseas!” said Senate Minority Leader Tom Daschle, D-S.D.

But economists say outsourcing cuts costs, boosts profits and eventually helps companies hire more workers in the United States.

“It does create more jobs in the long run. They are different jobs. They will be more skilled jobs, but there is no question that it will create more jobs in the long run,” said Catherine Mann, senior fellow at The Institute for International Economics.

Outsourcing also helps consumers. A recent study found that computers cost one-third less in the 1990s because high-tech parts were produced more cheaply overseas.

Outsourcing is a growing trend. The concrete slabs for a public library in Salt Lake City were outsourced to a Mexican contractor 2,400 miles away. The prefab panels were shipped on 140 flatbed trucks, and the library still saved more than a million dollars.

But there is no way to measure the cost on people like Ed Lucas, who’s now learning how to tend bar while he waits for the economy to produce those new jobs.

Go East, Young Hi-Tech Worker

2006-09-01T07:31:00.000+14:00

Go East, Young Hi-Tech Worker

Considering India as Land of Opportunity for Westerners
By Siddarth Srivastava, Pacific News Service

NEW DELHI - August 24, 2004 - During the dot.com boom a few years ago, India mourned the loss of its best and brightest to the West. Now, Indian headhunters are talking of foreigners -- Americans, Europeans, Japanese, Filipinos and just about any other citizen of the world-- coming to India looking for employment.

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Outsourcing Blues: Training My Overseas Replacement

2006-09-01T07:29:00.000+14:00

By Body Taing, Pacific News Service

A young assemblyline worker in Silicon Valley tells of the arrival of Chinese workers at his company, and the reaction of a workforce fearful, resentful and in some cases apathetic about impending layoffs.

SAN JOSE, Calif. - July 9, 2004 - The other day I showed a guy from China how to do my job -- so he could take it home with him.I'm lucky. I still have a job in Silicon Valley manufacturing, for now. In the past couple years I've competed against college graduates to keep jobs like this. But now it's not just college students who want this work. Degrees don't mean a thing if your job is moving to another country.Welcome to the real Silicon Valley, the mother of all outsourcing.

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America's Boom Industry: Outsourcing

2006-09-01T07:17:00.000+14:00

"Don't worry; they'll get better jobs in the service sector." During the last three decades of the 20th century, this was the mantra of most government and business leaders when corporations transferred auto or apparel jobs to Mexico or China. That line doesn't work anymore, since U.S. companies have started shifting a wide range of service jobs as well -- from high-skill computer programming to entry-level call center jobs -- to India and other lower-wage nations. This breaching of the final frontier of American jobs has caused understandable anxiety and has become a hot-button issue in the presidential election campaign.
The trend toward foreign "outsourcing" of service jobs is an extension of a longstanding practice of cutting costs by subcontracting parts of business operations to nonunion shops within the United States. The practice has gone global, in part because of technological changes. Massive amounts of information can now be transmitted across the world at low cost, making geographic distances less important. International financial institutions and trade agreements have also facilitated the trend by promoting investment liberalization and privatization of public services, creating new opportunities for U.S. corporations in overseas markets.
Forrester Research estimates that about 40 percent of Fortune 1,000 firms have already outsourced some work and that at least another 3 million service jobs will leave the United States by 2015, led by information technology work. A study by the University of California, Berkeley estimates that 14 million U.S. jobs (11 percent of the total work force) are vulnerable to being outsourced.
Although the number of jobs lost so far is small relative to the total work force, these layoffs have a huge impact on the affected communities, and the potential for white-collar jobs to be offshored is deeply unsettling for many American workers. In addition to job cuts, service workers must now also contend with the enhanced power of highly mobile, increasingly unregulated global corporations to bargain down U.S. wages and working conditions by threatening to move jobs elsewhere.
According to McKinsey and Company, a consulting firm that helps businesses develop offshore operations, U.S. companies make up about 70 percent of the global outsourcing market. Their top destination in the developing world is currently India, where domestic subcontractors perform a range of services for the U.S. market. At the low-skill end, Indian workers earn $1 or less per hour to handle customer service calls for firms like Earthlink and Travelocity. Among the higher-skill workers are Indian computer programmers, who earn about one-tenth the pay of their U.S. counterparts to write code for multinational corporations like Citigroup. Given a lack of other economic opportunities, Indian workers are often eager to secure new jobs catering to the U.S. market. However, there is also a nagging fear that these jobs may evaporate as soon as companies can find lower costs elsewhere. China, of course, looms on the horizon. It is already the second-biggest developing-country draw for service work, offering rock-bottom wages and an official ban on basic union rights. Though it lacks India's English-speaking advantage, this may not be the case forever, as Beijing is heavily promoting English-language education. Mexico's experience in competing with China over manufacturing jobs could foreshadow events to come. Although employment in Mexico's border export zone more than doubled after the implementation of the North American Free Trade Agreement (NAFTA) in 1994, the country has in recent years lost several hundred thousand of these jobs, partly in economic flight to lower-wage China. India has even lost some foreign manufacturing jobs to China.
Public pressure has galvanized U.S. state and federal legislators to introduce a flurry of bills to curb outsourcing, primarily by requiring that government contract work not be performed overseas. However, there is stiff resistance from the corporate lobby, such as the new Coalition for Economic Growth and American Jobs, which represents some 200 trade groups, including the U.S. Chamber of Commerce and the Information Technology Association of America. These and other pro-outsourcing groups argue that the practice is good for U.S. workers, because it lowers the cost of services for U.S. consumers and enhances the overall competitiveness of U.S. companies. Another common claim is that recent job losses are due to productivity gains, not outsourcing. However, because workers are facing a "jobless" recovery and see few personal benefits from enhanced productivity, these arguments convince very few.
One reflection of public opinion is that concerns about U.S. trade policy have spread up the income ladder. Lower- and middle-class workers have been consistently skeptical of U.S. trade policies, but a February 2004 University of Maryland poll showed that even among Americans earning over $100,000 a year, support for actively promoting more "free trade" has dropped from 57 percent in 1999 to 28 percent in 2004.
Bush, Kerry polices towards outsourcing
As they vie for votes in layoff-ridden swing states, both presidential candidates are offering solutions to the prevailing American angst about trade and outsourcing. Railing against "Benedict Arnold" companies, Sen. John Kerry has vowed to eliminate government incentives for outsourcing. For example, he would place conditions on most government contracts to require that the work be performed in the United States. He would also eliminate a tax break that currently allows U.S. businesses to defer tax payments on income earned abroad, and he proposes to use the resulting revenue to lower the overall corporate tax rate from 35 to 33.25 percent. Similarly, Kerry would offer incentives to encourage transnational corporations to repatriate earnings and would then channel these revenues into an employer tax credit for new hires. Regarding trade, Kerry has vowed to include stronger labor and environmental protections in future trade pacts and to review all existing agreements.
The Bush administration has delivered mixed messages regarding outsourcing. Two prominent officials have publicly endorsed the practice -- Treasury Secretary John Snow and Gregory Mankiw, chairman of the Council of Economic Advisers. Both have argued that foreign outsourcing of service jobs is good for the American economy, because it helps companies become more efficient. Meanwhile, President Bush has sought to distance himself from such statements and instead to focus public attention on his administration's new "21 st Century" jobs plan. Bush argues that the real driving forces behind outsourcing are "frivolous" lawsuits, excessive regulation, and high taxes. He also claims that NAFTA and other trade agreements have been good for U.S. workers, and he promises that by breaking down even more trade barriers his policies will boost export-related jobs. "The best product on any shelf anywhere in the world says, 'Made in the USA'," Bush told an audience of women entrepreneurs in Cleveland.
But the Bush administration's jobs plan ignores the historical record and thus misdiagnoses the problem. Government figures show that U.S. employment for American multinational corporations grew only 25 percent between 1982 and 2001, while employment at their overseas affiliates increased 47 percent. (These figures likely underestimate foreign expansion, because they do not include information on employment through subcontractors, data the U.S. government does not require businesses to report). This period of rapid overseas expansion has coincided with increased trade and investment liberalization and a declining corporate tax burden. U.S. employers are leaders in outsourcing, even though their share of the national tax bill is considerably lower than the average for employers in other industrial nations.
Bush's claim that companies are fleeing "Big Government" is also dubious. McKinsey and Company claims that U.S. corporations have led the outsourcing trend not to escape burdensome regulations, but because the relatively unregulated U.S. labor market facilitates sending jobs abroad. McKinsey, a pro-outsourcing consulting firm, points out that compared to most European counterparts, the United States has "liberal employment and labor laws that allow companies greater flexibility in reassigning tasks and eliminating jobs."
Kerry's early jobs plan is encouraging, but it addresses only one side of the issue. His proposal to end taxpayer subsidies for outsourcing, whether through government contracting or tax breaks, is long overdue. Citizens should not have to pay higher taxes to subsidize the evaporation of their jobs. To ensure effectiveness, any reforms must be carefully crafted to prevent potential loopholes. More effort will also be needed to address the threat posed by existing international agreements to domestic legislation that requires public contract work to be performed in the United States. For example, under World Trade Organization rules, the Government Procurement Agreement bans governments from favoring domestic firms in procurement contracts. Although only 25 countries have signed the agreement thus far, plans are under way to expand its scope and incorporate similar rules in other trade pacts.
Kerry's primary focus on domestic measures will have only a modest impact on the jobs issue, because these policies cannot make up for the extreme gap in labor costs, which is the primary driving force behind outsourcing. McKinsey estimates that global pay gaps result in a net cost savings for outsourcers of at least 45-55 percent (after accounting for higher infrastructure and other costs). If this is true, figures in a 2003 University of California, Berkeley study suggest that companies could save around $300 billion a year if they outsourced all of the estimated 14 million U.S. service jobs considered feasible to transfer overseas.
Kerry's promises to change U.S. trade policy are also a step in the right direction. If there were effective international mechanisms to strengthen labor rights enforcement, developing-country workers would have a better chance of obtaining fair wages. Research commissioned by the AFL-CIO indicates that labor rights violations in China artificially depress wages by 47-86 percent and that if the country were to respect basic internationally recognized labor rights, wages would likely increase 90 to 595 percent. However, the goal of strengthening labor rights protections should be pursued as part of a broader strategy to uplift conditions generally in poorer countries. Without overall economic improvements, developing-country governments will continue to face strong pressure to attract foreign investment by offering lax labor rights enforcement, thereby undermining efforts to maintain high standards in the richer countries.
Toward a New Foreign Policy
The overall goal of U.S. policy on outsourcing should be to attack the factors that make workers -- in the U.S. as well as around the world -- vulnerable to exploitation by increasingly mobile and unregulated global corporations. The approach needs to recognize that raising standards overseas is vital to retaining stable and substantial jobs at home. This requires a multifaceted response encompassing changes in domestic tax, procurement and labor laws as well as in multilateral trade, finance and aid policies.
On the domestic side, a first step should be to reform tax and procurement policies at all levels of government to ensure that they support good jobs in the United States. Additional subsidies that enhance the incentives for corporations to shift jobs overseas should also be eliminated. These include risk insurance and loan guarantees provided by the Overseas Private Investment Corporation as well as technical assistance and other supports offered by the U.S. Trade and Development Agency. Moreover, the U.S. government should ensure that U.S. authorities, as well as their counterparts around the world, have the right to use tax and procurement policies as instruments to support social goals without being undermined by international trade agreements.
The domestic policy response should also involve labor law reforms that reduce current obstacles to union organizing and that beef up rules related to laying off workers. Most European countries require that corporations guarantee higher severance pay based on years of service, which substantially raises the cost of moving jobs. Many European countries also oblige companies that are planning to close an operation to consult with unions and sometimes to negotiate over the decision. By contrast, under U.S. law, unions may only bargain over the effects of a closure. Thus, although European countries also experience outsourcing-related job loss, the practice is not as advanced as in the United States.
However, domestic measures, while significant, do not address the biggest incentive for outsourcing -- extreme wage gaps. Tackling this problem will require a long-term commitment to supporting sustainable economic activity in poor countries and should focus on the factors that make workers around the world vulnerable to exploitation by global companies.
One of these factors is lax enforcement of internationally recognized labor rights, which artificially depresses wages. U.S. policymakers must learn from the failure of NAFTA's weak labor rights mechanism and should develop a better model. The Hemispheric Social Alliance has proposed involving the International Labor Organization in monitoring compliance and investigating complaints related to rights violations. If necessary, assistance would be provided to help countries achieve compliance. Only if this approach was unsuccessful would sanctions be applied, and if the perpetrator was a specific company, the punishments would be targeted at the company rather than at the host government.
Any labor rights initiative, however, should be integrated within a broader strategy toward poorer nations. Other factors that make workers vulnerable are high unemployment and poverty. Although national governments are not without responsibility for these problems, international financial institutions and trade agreements have played an exacerbating role. For example, the World Bank, the International Monetary Fund and the World Trade Organization all threaten the livelihoods of tens of millions of farmers by pressuring poor-country governments to eliminate tariffs and agricultural subsidies. Likewise, privatization supported by these international financial institutions has often resulted in mass layoffs and weakened social services. These multilateral agencies should instead join governments in promoting "global green deal" policies that stimulate stable and substantial employment while protecting the environment.
Regarding trade, Washington should withdraw its support for rules -- such as in Chapter 11 of NAFTA -- that grant excessive protection to U.S. investors against public interest laws and other host government actions that diminish profits. Such trade rules undermine democracy and encourage U.S. firms to shift jobs overseas.
To enhance this new and broader strategy toward poorer nations, the U.S. government should advocate for stronger international mechanisms to transfer resources from richer to poorer countries. Where appropriate, this would include debt reduction or cancellation. Washington could also promote the adoption of international taxes on both foreign exchange transactions and arms sales to generate revenues for development purposes. The U.S. must also revamp its development aid policies to emphasize anti-poverty measures, healthy communities and a clean environment rather than handouts to U.S. corporations like Halliburton and Bechtel.
In short, a comprehensive response to corporate outsourcing requires a sea change in the outlook of both the U.S. public and its politicians toward America's role in the world. Just as Americans are less secure when much of the world is plagued by extreme poverty, inequality and instability, worker exploitation overseas translates into exploited workers and less secure jobs at home. The electoral debate over outsourcing offers an opportunity to create a new policy approach that combines solidarity with self-interest in a whole-scale effort to benefit the entire world.

Will Work for Ramen - The Truth about Tech Jobs..

2006-09-01T07:00:00.000+14:00

Will Work for Ramen - The Truth about Tech Jobs..

American CEOs say the high tech economy is booming, yet at the same time they're offshoring tens of thousands of IT jobs. Confused??? So are we! This short, funny animated film dares to tell the truth about America's struggling tech economy - and the skilled workers who are paying the price. [Read Full Story]

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Offshoring obsessions miss the point

2006-08-31T09:19:00.000+14:00

COMMENTARY--"No, you can't outsource your homework to India!" the gruff father in the cartoon pinned to our lunchroom board tells his son. Jeez, now that even the cartoonists have picked up on offshoring, it must be a hot trend.

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Workers aren't owners of outsourced jobs

2006-08-31T09:13:00.000+14:00

Workers aren't owners of outsourced jobs

Recently we've been hearing a lot about what has come to be called "job outsourcing." That is, Corporation X will send some or most of its jobs overseas. While this certainly isn't something to necessarily cheer about, I think a major point needs to be addressed which has been overlooked.

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Resources

2006-08-31T07:34:00.000+14:00

Job Sources:

Fortune Magazine's Career Advice by Anne Fisher
www.fortune.com/fortune/careers
Jobs, Careers, and Job Search Resource Center
www.job-hunt.org/
Comprehensive internet job search engine
www.monster.com
USAJOBS main page
www.usajobs.opm.gov/
Career-related info from The Wall Street Journal
www.careerjournal.com/
Helping Families Deal With Job Loss
www.familycorner.net/
Search tech jobs, post resumes and find job fairs
www.brassring.com/
Premier job search engine
hotjobs.yahoo.com/
Independent Contractors bidding on projects
www.ubidcontract.com/
Fed Jobs Career Center
www.fedjobs.com/
Complete listing of thousands of currently available jobs
www.1-allusjobs.com/
Technology job board
www.dice.com/
Search hundreds of thousands of jobs
www.careerbuilder.com/
Computer Jobs and Technical Employment
www.computerwork.com
America's Job Bank - job search engine
www.ajb.dni.us/
CareerOneStop - job portal
www.CareerOneStop.org/
Go To Top
Counselors:
Professional Counselors Database
www.allaboutcounseling.com/Counselors/searchscreen.cfm
Los Angeles psychotherapists and psychologists
www.therapyinla.com/
Find the right psychologist, therapist, or counselor
www.4therapy.com/consumer/
Internet Mental Health
www.mentalhealth.com
Depression Central
www.psycom.net/depression.central.html
Online Medical Support Groups
www.supportpath.com
Northwest Mental Health Associates
www.nmha.com
NIH Anxiety Disorders
health.nih.gov/result.asp?disease_id=48
NIH Depression
health.nih.gov/result.asp?disease_id=183
National Institute of Mental Health
www.nimh.nih.gov/
Go To Top

Outplacement Consultants:

Challenger, Gray & Christmas, Inc
www.challengergray.com/cgchome/default.aspx
Association of Career Management Consulting Firms
www.aocfi.org/
Education and career management firm
www.piedmontpress.com/blackwell/
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Unemployment Services:
U.S. Department of Labor Employment
& Training Administration
workforcesecurity.doleta.gov/map.asp
Go To Top

Legal Sites:

Legal Resources
www.findlaw.com
National Labor Relations Board
www.nlrb.gov/nlrb/home/default.asp
Law Research
http://206.63.60.14/cfjudic.htm
Age Discrimination Information
www.dol.gov/dol/topic/discrimination/agedisc.htm
Civil Rights Information
www4.law.cornell.edu/uscode/42/ch21.html
Family and Medical Leave Information
www.dol.gov/esa/whd/fmla/
Workers Adjustment and Retraining Notification Act
www.dol.gov/dol/allcfr/ETA/Title_20/Part_639/toc.htm
U.S. Department of Labor
www.dol.gov
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'I lost my job to India, all I got was this lousy T-shirt'

2006-08-31T07:04:00.000+14:00

No threat to US jobs because America alone can be the birthplace of ideas. Bangalore techies can only help them reach the market quicker .

Yamini Narayanan is an Indian-born 35-year-old with a Ph.D. in Economics from the University of Oklahoma.

After graduation, she worked for a US computer company in Virginia and recently moved back to Bangalore with her husband to be closer to family. When I asked her how she felt about the outsourcing of jobs from her adopted country, America, to her native country, India, she responded with a revealing story:

''I just read about a guy in America who lost his job to India and he made a T-shirt that said, 'I lost my job to India and all I got was this (lousy) T-shirt.' And he made all kinds of money.''
Only in America, she said, shaking her head, would someone figure out how to profit from his own unemployment. And that, she insisted, was the reason America need not fear outsourcing to India: America is so much more innovative a place than any other country.

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What is Outsourcing?

2006-08-31T06:56:00.000+14:00

Listen to the world's top outsourcing authority, Peter Bendor-Samuel, answer the question 'What is Outsourcing?' Click here to watch the video with RealPlayer. Don't have RealPlayer? Download a free player by clicking here.

What is outsourcing? Outsourcing takes place when an organization transfers the ownership of a business process to a supplier. The key to this definition is the aspect of transfer of control. This definition differentiates outsourcing from business relationships in which the buyer retains control of the process or, in other words, tells the supplier how to do the work. It is the transfer of ownership that defines outsourcing and often makes it such a challenging, painful process. In outsourcing, the buyer does not instruct the supplier how to perform its task but, instead, focuses on communicating what results it wants to buy; it leaves the process of accomplishing those results to the supplier.

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