It Contractor? Out Of Work? Wages Depressed?

[Where is my pen?]

We can rant all we like on this and other forums, but the fact remains that globalisation is an unstoppable force that will not stop until wage and salary levels are the same in every country in the world.

I used to think this was a good thing, because why should a worker in the UK earn as much in a week as a worker doing the same job in Africa or Asia earns in a year.

I hoped that this equalisation would occur by lifting foreign workers up to our income levels, which would have meant even more consumers to buy even more goods and a general improvement in standards of living for everyone on the planet.

But sadly, businesses have taken the opposite approach, and chased wages and salaries downwards.

It now looks like this process will not stop until workers in the developed countries are prepared to work and can survive on the same wage as a similar worker in a place like Vietnam.

This is not pleasant to contemplate but it is a fact like gravity, and will affect us whether we like it or not.

The only hope for countries like the UK, is for government to intervene and force the cost of living down to a point where workers can live in those countries for the same costs as workers in Shanghai or Bangalore. To do this they would need to use draconion powers to force down the prices of artificially inflated items like houses. Individuals can play their part by downsizing their lives to the bare minimum. Do without a second car, rent instead of buy, dont expect an overses holiday every year as your right, mend clothes instead if being ripped off by expensive fashions that are out of date tomorrow.

You cannot rely on business to help with this process because they owe no allegience to citizens of any country and will play beggar thy neighbour until wages are a penny a day.

this is nonsense left wing tripe.

Edited August 27, 2009 by Where is my pen?

[Where is my pen?]

No.

What do you do for a living?

How can you be even remotely self employed then? If you have never done this, then you have no idea what it means. All you do is decide who to work for. Well, frankly, so does a Tesco shelf stacker. And they are not protected from foreign labour... wonder why Tesco staff are not all Indian?

Edited August 27, 2009 by Where is my pen?

[slurms mackenzie]

How can you be even remotely self employed then? All you do is decide who to work for. Well, frankly, so does a Tesco shelf stacker. And they are not protected from foreign labour... wonder why Tesco staff are not all Indian?

Eh? Who said i was self employed?

I was asking what you did for a living?

What do you do for a living?

Third times the charm.

[Where is my pen?]

Eh? Who said i was self employed?

I was asking what you did for a living?

What do you do for a living?

Third times the charm.

My apologies, I got confused with something else.

[UncleKev]

this is nonsense left wing tripe.

Thank you. I am usually called a right wing reactionary. This shows that my views are becoming more balanced with age.

[slurms mackenzie]

Thank you. I am usually called a right wing reactionary. This shows that my views are becoming more balanced with age.

Do you spout left wing tripe ?

If you'd have asked me 20 years ago i'd have said "nooooooooo"

If you'd have asked me 10 years ago i'd have said "nooooooooo"

and so on and so forth.

[PSmith]

Actually, this daily rate also includes sick pay, holiday pay, pension contributions, no redundancy payments, etc etc and after all is totted up, contractors are not that much better off than permies, it just looks better on paper to those who don't realise that the salary the employee gets is only part of the real cost of employing them.

However, the company is far better off as contractors do not have any kind of job security -- if a female contractor gets preggers it's her problem and if the contractor's face does not fit, he can just be sacked without any recourse to a tribunal. So, it's rather surprising that any company still uses the employee model, given the obvious drawbacks of that kind of system -- it's not a skill shortage as such at all, just that employers no longer want to have the hassle of employing permies in the first place.

Most people work about 220 days per year after subtraction of holidays and sick pay.

220 * £200 = £44,000

220 * £500 = £110,000

The the upper is ridiculous when you consider that that equates to about 16 Indian years of work. Or 220 years of an Indian policeman's salary.

Contractors don't have to pay the same national insurance permanent workers have to pay, they usually pay themselves a minimum wage of about £6 per hour and then take the rest as dividends. This means that they pay less national insurance than a low paid worker and take home more that the equivalent permanent worker on the same wage.

We live in a competitive meritocratic society, there is a reason work is off-shored and in-shored it is because it is cheaper to get it done that way. A lot of people get paid too much, usually this is people paid out of the public purse; doctors, lawyers, BBC directors and contractors brought in by the government. They are people who are paid by someone who is not actually getting the service.

Edited August 27, 2009 by PSmith

[MongerOfDoom]

Yep, people often save up for plane tickets to be exploited.

:-) Good point well made.

[Authoritarian]

Protectionism.

IT contractors realise they can't compete fairly so instead they resort to pushing for restrictive legislation.

Whats wrong boys, not afraid a poor little Indian is going to take your job are you? They can't be the case, I'm sure your computer science degrees mean that you're vastly superior to many of these foreigners who are so eager to do your jobs for half the price.

If only I could get the gov't to enact legislation to deport all the foreign workers in my field I'd be raking it in.

Edited August 28, 2009 by chefdave

[slurms mackenzie]

It's a fair point.

Dave got replaced by a microwave years ago.

---

In all seriousness dave if thousands of bog standard chefs from outside the EU tried to get into the country, would they be allowed in with our new points system?

If not, would you concede it's a different case?

Edited August 28, 2009 by slurms mackenzie

[Authoritarian]

It's a fair point.

Dave got replaced by a microwave years ago.

Exactly, and to rub salt into the wounds it wasn't even manufacturered in Britain.

[Joey Buttafueco Jr]

Who needs to complete a tax return?

* self-employed people (including members of a partnership)

* company directors (except not for profit organisations)

* ministers of religion (any faith)

* people who get rent or income from land and property in the UK (but if you are an employee and this income is less than ?2,500 a year a tax return may not be necessary)

* people who have other untaxed income and the tax due on it cannot be collected though a PAYE tax code

* people with taxable foreign income, even if they are not normally resident in the UK (this includes non-resident landlords)

* anyone who receives annually (or can be treated as receiving) income from a trust or settlement, or any income from the estate of a deceased person, and further tax is due on that income

* trustees and personal representatives (including people who manage the tax affairs of deceased persons)

* trustees of certain pension schemes

* names or members of Lloyd's

* employees and pensioners with more complex tax affairs - see below

I know loads of employees that fill in tax returns - I believe it is required if you are a higher rate taxpayer.

[slurms mackenzie]

I know loads of employees that fill in tax returns - I believe it is required if you are a higher rate taxpayer.

That's what i thought too although i was being lazy and just dropped that in of HMRC just to prove that 'where is my pen' was going down a blind alley.

I did spend my first five years working on tax softward - dull dull dull.

In 1999 we started to outsource the production of the actual returns, (we'd send over the copies from the IR and expect replicas back over which we could overlay the results from our system), big mistake, didn't take long for that work to come back in house. I'm sure outsourcing has got a bit better these days.

Edited August 28, 2009 by slurms mackenzie

[Joey Buttafueco Jr]

That's what i thought too although i was being lazy and just dropped that in of HMRC just to prove that 'where is my pen' was going down a blind alley.

I did spend my first five years working on tax softward - dull dull dull.

In 1999 we started to outsource the production of the actual returns, (we'd send over the copies from the IR and expect replicas back over which we could overlay the results from our system), big mistake, didn't take long for that work to come back in house. I'm sure outsourcing has got a bit better these days.

I'm not sure that the original poster has their facts straight - the sentence went something along the lines of

"do you fill in a tax return? If not you are an employee"

2 things

1. A lot of contractors are employess of their limited companies

2. The accountant tends to to the tax return as part of the service.

[Cinnamon]

Most people work about 220 days per year after subtraction of holidays and sick pay.

220 * £200 = £44,000

220 * £500 = £110,000

The the upper is ridiculous when you consider that that equates to about 16 Indian years of work. Or 220 years of an Indian policeman's salary.

Yes, but in real terms, Indians actually earn lots more than most Brits. Moreover, those Indians who are stealing people's jobs in the UK are upper middle class people who have been extremely well off for generations(due to the fascist, exploitative class system the Indians have), and the people they are displacing are often 1st generation middle class risen up from working class (so much for social mobility...) Also, remember, an education in the West nowadays costs a lot of money: 3 years living + tuition and college fees, also the lost wages... you easily can get to 100k investment here and that is before you factor in what it costs to get a child to university age.

Contractors don't have to pay the same national insurance permanent workers have to pay, they usually pay themselves a minimum wage of about £6 per hour and then take the rest as dividends. This means that they pay less national insurance than a low paid worker and take home more that the equivalent permanent worker on the same wage.

Contractors also do not get pensions, sick pay, holiday pay, they have no job security whatsoeever and when you factor it all in, using contractors SAVES the company money, and many workplaces in the city no longer even take on permanent staff, because the resulting costs and the employment rights hassle are too much.

As I stated before, looking at the mess of legislation that HR nowadays has to juggle I'm amazed that anyone in this county still uses employees instead of contractors.

We live in a competitive meritocratic society, there is a reason work is off-shored and in-shored it is because it is cheaper to get it done that way. A lot of people get paid too much, usually this is people paid out of the public purse; doctors, lawyers, BBC directors and contractors brought in by the government. They are people who are paid by someone who is not actually getting the service.

Lots of contractors work in the private industry too, and the reason that rich middle class Indians can compete here is that they are allowed in and so can exploit the arbitrage in taxation without paying their actual share of the real cost to run this and build this country.

And the UK is not a meritocracy at all, it's a bribocracy at best.

[this_prisoner_is_opting_out]

I know loads of employees that fill in tax returns - I believe it is required if you are a higher rate taxpayer.

Yeh for a minute there I thought my dad had either caught religion or was hiding a huge amount of money somewhere.

[slurms mackenzie]

Yeh for a minute there I thought my dad had either caught religion or was hiding a huge amount of money somewhere.

and then you read the line

"employees and pensioners with more complex tax affairs - see below"

Hopefully.

Edited August 28, 2009 by slurms mackenzie

[this_prisoner_is_opting_out]

and then you read the line

employees and pensioners with more complex tax affairs - see below

... and by "complex tax affairs" I translated this to "has 7 accounts in Zurich" and came over all unnecessary.

Back on topic: I'm in IT FWIW and I actually don't feel threatened by this cheap labour - perhaps it's because my standard of living is already pants. Seriously, the stuff we sent to India is donkey work, uninspiring and repetitive - for me it's meant an increase of responsibility. Yes, it annoys me that they get sent over and are put up in apartments costing a good chunk of my net salary - but they still have to go home to some hellhole in Bangalore where they don't even have running water. I mean FFS one of them got Typhoid last year - how is that even possible in a supposed "advanced society"?

I don't care it's not fair that someone in Bangalore/Shanghai earns less than me for the "same" job - I really don't. When push comes to shove I'm saving Europe over SE Asia. They can have all our jobs if they want to - we are in the wonderful position of being able to catch rainwater which is drinkable and have enough land to feed all of us.

China, despite having an enormous land mass have people dying of thirst?

Edited August 28, 2009 by this_prisoner_is_opting_out

[Nationalist]

you don,t have a girlfriend do you?

Intriguing use of a comma there...

[TheEmperorHasNoClothes]

Absolute rubbish.

Why would it be ridiculous to stop such blatant abuse. At what point does it become unacceptable, when every single native IT worker is on the dole and replaced by an Indian?

I agree. I am a UK manufacturer. I think we should stop importing products from China as it is doing me out of business. Lets start with all electronic goods, such as Laptops, TVs etc. and let's have em all made in the UK. Doesn't matter if the consumer has to pay £10000 for a TV. I don't care. I want my cushy little number.

Edited to say....

Protectionism!

Edited August 28, 2009 by TheEmperorHasNoClothes

[the end is a bit nigher]

Protectionism!

It is indeed protectionism we are talking about. Certainly not racism.

I would have no problem with an Indian worker bringing their family to live in the UK at his own expense and directly competing with me for a job as they would have the same basic living costs. If they wanted to undercut me then that would be fine.

[TheEmperorHasNoClothes]

It is indeed protectionism we are talking about. Certainly not racism.

I would have no problem with an Indian worker bringing their family to live in the UK at his own expense and directly competing with me for a job as they would have the same basic living costs. If they wanted to undercut me then that would be fine.

High living costs are a result of people having over inflated wages! Competition from overseas helps us in this regard. If you don't like overseas competition, I take it you don't buy any foreign food, go on cheap foreign holidays, buy furniture or household goods that were manufactured abroad? Do you lead by example?

I don't ... but I am not complaining about competition. In fact it is good it stops us being lazy.

If it means you can no longer afford to live and eat etc. then there are solutions, such as move to somewhere where you can afford to live and eat off an average wage. That might be India! You are then exercising your right to not be fleeced, and as a result will reduce demand for food, accommodation, fancy restaurants in your old area and therefore the price of living will drop there. OK granted many people will need to flee - but they will. They will have to just to survive. Especially when the state gets to a point where it cannot afford welfare. It's all supply and demand. There is a big premium to live in the UK, especially the south-east and you have to decide if it is worth it. If house prices += £50k and wages -= £50k then probably not!

[Cinnamon]

High living costs are a result of people having over inflated wages!

Actually the high wages are not the problem (since it would mean that people can buy more stuff, or more expensive items) but taxes that take over 50% of what people make after all is totted up, result in high living costs and very little disposable income.

It's all in the way the cake is split up, and right now, the taxman earns way more than all of you put together.

For example: scrap VAT and everything out there is an immediate 15% cheaper, plus the overhead for petty bookkeeping is also gone.

[SeenItAllBefore]

Moreover, those Indians who are stealing people's jobs in the UK are upper middle class people who have been extremely well off for generations(due to the fascist, exploitative class system the Indians have), and the people they are displacing are often 1st generation middle class risen up from working class (so much for social mobility...)

And the irony is that a lot of the british IT workers currently out of work are from families that left India to get away from this system. I see plenty of them have signed that petition, including an old colleague of mine, or someone with the same name at least.

I presume this ICT scam has come about because it’s finally sunk in that off-shoring anything other than routine work to the indians just doesn’t work. Sooner or later they’ll figure out that the total cost of bringing them over plus the close supervision they need so they actually produce something fit for purpose exceeds that of just hiring a better quality local in the first place.

Every bloody job in this country could be done cheaper by an imported indian. If that’s the rationale behind importing labour why don’t we bring in their teachers, coppers, bin men etc and put the whole country’s workforce on the dole.

This country is a nut house, it really is.

[Agentimmo]

High living costs are a result of people having over inflated wages! Competition from overseas helps us in this regard. If you don't like overseas competition, I take it you don't buy any foreign food, go on cheap foreign holidays, buy furniture or household goods that were manufactured abroad? Do you lead by example?

I don't ... but I am not complaining about competition. In fact it is good it stops us being lazy.

If it means you can no longer afford to live and eat etc. then there are solutions, such as move to somewhere where you can afford to live and eat off an average wage. That might be India! You are then exercising your right to not be fleeced, and as a result will reduce demand for food, accommodation, fancy restaurants in your old area and therefore the price of living will drop there. OK granted many people will need to flee - but they will. They will have to just to survive. Especially when the state gets to a point where it cannot afford welfare. It's all supply and demand. There is a big premium to live in the UK, especially the south-east and you have to decide if it is worth it. If house prices += £50k and wages -= £50k then probably not!

It can't be India. They wouldn't allow me to settle in their country with my wife and kids and for us all to work.

They operate protectionism. As do most other non-EU countries, especially in the 3rd world.

Your argument is nonsense. I'm quite up for relocating to China to work. But they won't let me in