“Baby boomers, Gen Y and the issues USA face in regaining industrial high ground”. Hiring a fresh graduate is becoming a new trend in the corporate world. Even though this generation has a comparable (also called as Generation Y or Millennia’s) lack of work experience and other management skills, to the previous generation X and baby boomers. The beginning of the Generation Y into the workplace is bringing new changes that need to be addressed. They are looking for a sustainable environment offering a social structure within both a physical and virtual environment. Hence companies are trying to ascertain their attitude and work habits that need to be incorporated into this existing culture. The characteristic of these generations are also defined as, tech savvy, racially diverse, socially more interconnected and collaborative. Bringing fresh and innovative skills to the work place. They have got lots of enthusiasm within them, meaning they are ready to work a more flexible schedule and can also keep a better work/life balance.
As baby boomers are readying for their retirement stage, they have carried lot of work experience with them but the problem is “How do they pass on their skills and knowledge to these future generations?” The problem with baby boomers is their unwilling attitude to change their ways, they will always argue stating “this is how I prefer doing my work, or this is how we’ve always done it”. Why is this happening? Baby boomers are also called the post World War II generation, brought up in ever expanding industrial world, they have a passion for doing manual work, being raised in a patriotic environment i.e. love for their nation, regularly going to Sunday prayers whilst also helping their neighbour. Also that was the time, when the rate of immigrants flocking to the USA was much lower than today’s standards; also most of the immigrants were European. Hence people during that period didn’t interact much with other people. Compared to today, 13% of the US population consists of immigrants coming from different nationalities; therefore today’s generation is much more racially diverse and more socially interactive compared to previous generations, Gen X and Baby boomers.
Since generation Y, was brought up in a more tech savvy environment, they don’t simply adapt new ways of doing things, they internalise them and try to come up with new ideas. Surveys show companies such as Google, Intel, Microsoft, Infosys and the Android developers are among the most highly ranked companies for Generation Y, in terms of job satisfaction and flexible scheduling. “Tech companies play to Gen Y’s entrepreneurship and wanting to work in a company that’s constantly moving,” says Dan Schawbel, managing partner at Millennial Branding. One of the problems with today’s generation is that they are less committed and loyal towards any work environment. They will sometimes become lured by better opportunities or if they become bored with their jobs. Jo Ann Binzen, a human resource manager had this to say about the younger generations “they are being lured away. They don’t have that loyalty. They might be offered more money and even if they like working here, it doesn’t stop them from leaving”.
The reason for this might be that the current generation don’t wish to change their lifestyles; they would rather change their working environment then changing their needs and goals. Today’s generation want instant success without having to graft for it, which is compared to what their parent’s did to earn a living. Because generation Y have already seen/learned the problems concerning the previous generations, this makes them more confident and ambitious to overcome any issues more competently. In today’s world, if you wish to replace the baby boomers with Generation Y, then it is advisable to look into the pool of labour, there are so many talented youngsters whom can easily replace them. The problem is, will they work as responsibly as the baby boomers did, whilst also carrying out the work with the same efficiency? Generation Y and the baby boomers are two sides of the same coin; they are fundamentally different in justifying each other’s emotion and insecurities. Generation Y will work hard if their work is appreciated, on the other hand the baby boomers don’t need regular praise for their work. What’s the root of the problem that the American industries are facing currently?
There was a time when most companies were operating and manufacturing all their products from within the US. This helped the country gain its strength in terms of raising the standard of living and also as forming the country’s image as a manufacturer of high quality technological products. However when the term outsourcing became popular in America near the start of the 21st Century, the term outsourcing means one company contracting with another company to provide services, such as call centre services, e mail services and payroll. These jobs are handled by separate companies that specialise in each service, and are often located overseas. When the companies in the US started outsourcing they specifically started cutting their price on basic research and resources. They steadily started losing their strength and manufacturing work skills. Whilst moving their production units, companies only hired people who were highly professional like managers, engineers and skilled labourers. Other low skilled labourers were losing their jobs because they were getting replaced by the cheap labour power and resources which was easily available in other countries.
Because of industrial relocation, the baby boomers that were laid off from their work started moving to countries where their manual labour power could be of use. In the US where people are educated, issues like health and safety cannot be waived off easily, however in third world countries people’s priorities are much different for example getting there daily bread is considered far more important than education. This is another good reason why companies outsourced their production units into undeveloped countries because such companies know that problems like heath and safety standards won’t be much of a topic for debate. Whilst outsourcing, companies failed to observe the fact that they are actually letting/giving their own theories and methods of practice to the aforementioned countries outsourcing was only done to cut their R&D price and also get cheap manpower and resources.
On the other hand in countries like China and India, where manpower is easily available, outsourcing helped them to start making their own projects more effectively and efficiently. Some may think outsourcing was the right option during the 1980’s and the 1990’s, but now the companies are paying their price. This may be the reason why Germany didn’t outsource their skills and labour power to other countries. After losing in the war, the country was in huge debt for damages. They suffered both industrial losses and loss of lives. The only hope of getting economic recovery was dependant upon the reactivation of German industries. Even today the Germans are impressive in their manual skills as compared to other industrial countries. The reason behind this is that they value human skill over machinery; they also give same level of respect to every employee regardless of rank and superiority.
Hence they have made a very clear policy of not move/outsourcing any engineering work/projects outside of their own country. If today, industries in the US want to bring the production units back into their country, the question is do they have the people to do it, and the people with the same skills to do the job? Because most of the companies are IT based, they have the workers to get that particular job done, but if you ask an IT engineer to perform a job of industrial labourer, he will be unable or he won’t be willing to perform it. Also he won’t be satisfied with the wage received, if the company is going to pay the same wage, which they used to pay workers in other countries. The reason for the disagreement is the standard of living. For a person who is living in a developing or poor economy; for them the standard of living will be different as compared to those in a developed economy.
If the companies bring their production back into the US, they should be prepared to face those whereabouts issues which may come up. According to Armiger Reckons, some politicians have left their businesses because they are unsure of the future. Looking at past events, for example the 9/11 attacks (The most unforgettable day in book of US history). This also has some indirect contribution towards the US economic recession, in their rage the US government was severely underestimated the cost of the war. In the book “The Three Trillion Dollar War” by Joseph Stiglitz and co-author Linda Bilmes, it explains the war has not only cost the US economy but also damaged the world’s economy. The book throws a light on the hidden cost which has not taken into account for example, interest on the debt raised to fund the war, health care costs for veterans coming home, and replacing the destroyed hardware and degraded operational capacity caused by the war. “The reason was obvious. The war had led to high oil prices. The war had meant that America had to borrow more money. There weren’t sources of liquid funds in the United States.
The sources of the liquid funds were in the Middle East” the author said. During the recent 2012 US presidential election campaign, the candidates were fiercely debating on restoring US economy. Romney believed that the government was creating an obstruction to economic growth, whereas the incumbent president argued that the government plays a vital role in creating the foundations for a strong economy. Romney’s proposal was to reduce the corporate tax from 35 percent to 25 percent, which would help to bring corporate tax rates into line with rates in other countries. As a result this will help companies to keep their operations based in US, which would help in saving many US jobs and also keeping the company’s R and D groundwork knowledge safe within the country. If the US wants to restore its competiveness in the global market, it should divert its outsourcing into other countries, for example regions of Africa where they can obtain the same resource and labour market.
As we say all good things don’t come easy, the companies need to recapitulate the entire organisation starting from the very base. In regions of Africa, economic development is casually booming because currently most of the high ground industrial profiles are diverting their market into those regions. While diverting the markets into those regions, companies should come up with a business strategy which reflects upon the bad decisions made in the history of outsourcing. Instead of outsourcing their entire base the companies R&D production, and being entirely dependent upon the foreign workforce to get their work done, they should create job opportunities within the US. This will help solve the country’s ever growing issue with unemployment. In America the majority of job translocation is localised and also when industrial commons has taken root in a region, a powerful virtuous cycle feeds its growth. While finding a labour in pool of talent, experts flock there because that’s where the job and knowledge networks are; also the knowledge is safe within the people of the country instead of falling into the hands of foreign network.
Whilst doing so the company should also learn the characteristic behaviour working with Gen Y and baby boomers in the workplace, by creating a good environment in which both generations can work together. For example, most of the baby boomers and Gen X are already reaching their early 60’s, with the help of their previous experience they can be the mentors for the younger generations in designing the company’s strategy and guiding others in achieving their goals. Whereas as according to the Oxygen report on Gen Y, are more attracted to a company where values are clearly communicated, they are ready to engage in companies that provide the environment in which they can grow and evolve which include the physical space. This Gen Y can be used as a mobile workforce for doing the company’s out door tasks by giving them instruction on phone, email or via web interface, instead of the old routine where the labourer visits the office every morning and can thereafter carry out their job.
The introduction of this new method will be conceivably beneficial for both the company and the labourer, by saving time and expenses. At present China has got the strongest market economy, with many major companies’ production and R&D based there. Also the current success of these companies is due to China’s cheap resources and vast labour power. So whilst outsourcing into Africa, the US must maintain good and ethical relations with China. Instead of supporting short term investments which provides a quick gain in profits, the government should support long term investment into R&D taking into account the balancing of long term and short term goals. In recent times major corporations sue each other for pirating their work for example the on-going and very expensive battle between Samsung and Apple which seems to have no easy ending.
Instead companies should collaborate with one another by making a common research plan in which they have a common goal, but at the same time they should mutually understand each other upon the particular basis of research. Though outsourcing was considered to be a good idea adopted first during the late 80’s but the companies were unaware of the consequences. Though much has been lost since then, it’s still not too late to rebuild their industrial high ground. It is only achievable by recreating a new idea and strategy with better understanding between generations, to bring back America’s industrial high ground.
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