Why I Don’t Feel Too Guilty About Outsourcing

July 1, 2016, 12:00 PM UTC
Inside Tata Services Consultancy Campus As Outsourcing Orders Climb
Employees sit working at computers in the library of the Tata Consultancy Services Ltd. (TCS) campus in the State Industries Promotion Corporation of Tamil Nadu Ltd. (SIPCOT) IT Park in the Siruseri area of Chennai, India, on Thursday, Oct. 24, 2013. Tata Consultancy provides computer services and back office support to companies including Citigroup Inc. and Scandinavian Airlines System. The Indian software company also completed its acquisition of Frances Alti SA in July. Photographer: Dhiraj Singh/Bloomberg via Getty Images
Photograph by Bloomberg via Getty Images

Economic globalization causes massive social unrest, but at least my tech lead calls me “Sir Steve.”

Aamir, who lives in Pakistan, is a talented developer and a lovely man integral to the success of my new company. It was his English-influenced Pakistani education that taught him to refer to his seniors — no matter how unworthy — as Sir and Madam, and, more importantly, to be a damn good coder.

Most discussions of globalization evoke images of large corporations setting up factories in Mexico or India, or Polish workers flooding into England, but globalization has also created a vibrant global freelance economy. Websites like Upwork.com and Powertofly.com enable freelancers to pitch themselves and get hired for particular tasks or longer assignments. McKinsey estimates that online talent platforms could increase global employment by 72 million full-time equivalent positions by 2025.

This shift comes with some obvious advantages, starting with cost. Employees with solid technology skills are in such high demand in the U.S. that for my latest venture, it was nearly impossible to find someone who was talented and affordable. The scarcity literally threatened the existence of my firm.

Related: What a Dying Industry Can Learn From the Death Industry

Fortunately, once we looked outside the U.S., the prices dropped. We were able to hire Aamir and other freelancer developers and designers at a third to half the cost, along with remote specialists whom we could deploy for short bursts at lower prices. Our extended staff now includes people living in Pakistan, India, the Philippines, Croatia and — yes — New Jersey.

The human connection is present despite the distance, and it reveals itself in both good times and bad. Our Indian developers work in Chennai, India. When the city experienced a massive Katrina-level flood, we were emotionally and concretely invested in the plight of thousands of Indians and their families. Remote employees are not just “contractors” — they are our co-workers, just as much as if they’d been living in New York.

Of course, there are challenges. Finding talented and reliable people from 5,000 miles away can be tricky. While the intermediary freelancer marketplace has developed an Uber-like rating systems that ostensibly lets you see whether previous clients were satisfied, the system is subject to abuse. After one designer bailed on an assignment, I gave her a 3. She wrote back, saying that she was trying to maintain her 5 average and that if gave her a 5, she’d give me one as well. Wink wink. I took that as a threat: it would be a pity if anything were to happen to my ‘reputation.’

And no matter how good the video conferencing tools, you still lose quite a bit by not having your developers — and the rest of your staff — sitting around the same whiteboard.

When I described all this to a friend he said that while he could see how this was good for other countries’ economies, he was confused about how it benefited America. After all, the U.S. created just 38,000 jobs in May, the lowest figure since September 2010.

Related: Why Networking Is a Waste of Time

I understand where he’s coming from. It’s true — I’m currently paying as many people overseas as I am in the U.S., one of Donald Trump’s worst nightmares (along with people discovering he’s not nearly as wealthy as he claims).

On the other hand, without this system, I doubt my new company would even exist – nor would the three or four jobs I’ve filled by hiring Americans.

Perhaps there’s an unintended benefit for the United States: In the long run, it’s good for this country when tens or hundreds of thousands of men and women living in places like Pakistan and Russia work for American firms, and therefore see the U.S. as a positive force in their lives — and maybe the world. President Kennedy launched the Peace Corps because he thought well-meaning Americans would help fight communism in Third World countries. Perhaps the global gig economy – which tends to raise the wages of those in developing countries – could indirectly undercut the spread of anti-Western feeling.

Once we’re profitable, big and famous, we do intend to build out our staff here in the U.S. When a company enters a high-growth phase, it’s still much better to have a cohesive team in the same physical space so they can exchange ideas around the water cooler.

In the meantime, I’m grateful I get to work with people like our tech lead, who I really should be calling by his proper name: Sir Aamir.