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> It’s amazing that corporate America thinks it can’t hire a at all levels (...) I don't believe that's the case at all. It's not like they believe they can't

by rualca 6y ago

> It’s amazing that corporate America thinks it can’t hire a at all levels (...) I don't believe that's the case at all. It's not like they believe they can't hire someone. That's a silly assumption. There is however the idea that there are operational advantages in outsourcing non-core areas of their business. If they hire a specialized contractor to do maintenance tasks then you no longer have to bother with gaining expertise in that area, and you can even scale up and down your service to meet demands. The rationale is like figuring out how we have lunch. Sure, we can cook it ourselves and it will certainly be cheaper. However, if we pay a third party to provide us with our lunch then we get food cooked by pros and we even have the freedom to pick fancy dishes from some other restaurant if we deem it necessary.

burntoutfire 6y ago
> There is however that there are operational advantages in outsourcing non-core areas of their business. If they hire a specialized contractor to do maintenance tasks then you no longer have to bother with gaining expertise in that area, and you can even scale up and down your service to meet demands. From what I've seen in practice, it's always about the outside "specialized contractor" breaking various labor laws and generally screwing workers over in order to drive costs down. This way, even with the contractor markup, the company saves money and, at the same time, is not liable and does not take a reputation hit. It's a win-win for everybody but the workers. I guess they don't put that in the MBA textbooks though.
- kube-system 6y ago
  This is a correlation that you've observed that is actually caused by a third variable: these are often low-wage and low-leverage positions. Easily replaceable, low wage employees are common victims of labor law violations regardless of whether they're contractors or not. Employees that are in no position to fight back often get screwed.
Closi 6y ago
The key operational advantage is that you avoid providing any worker protections and can better achieve a race to the bottom via competitive tendering to low-margin outsourcing providers hiring minimum wage employees on temporary contracts.

by rualca 6y ago

burntoutfire 6y ago

> There is however that there are operational advantages in outsourcing non-core areas of their business. If they hire a specialized contractor to do maintenance tasks then you no longer have to bother with gaining expertise in that area, and you can even scale up and down your service to meet demands. From what I've seen in practice, it's always about the outside "specialized contractor" breaking various labor laws and generally screwing workers over in order to drive costs down. This way, even with the contractor markup, the company saves money and, at the same time, is not liable and does not take a reputation hit. It's a win-win for everybody but the workers. I guess they don't put that in the MBA textbooks though.

kube-system 6y ago
This is a correlation that you've observed that is actually caused by a third variable: these are often low-wage and low-leverage positions. Easily replaceable, low wage employees are common victims of labor law violations regardless of whether they're contractors or not. Employees that are in no position to fight back often get screwed.

Closi 6y ago

The key operational advantage is that you avoid providing any worker protections and can better achieve a race to the bottom via competitive tendering to low-margin outsourcing providers hiring minimum wage employees on temporary contracts.