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Businesses in the Recession.

  • 09-04-2009 4:26pm
    #1
    DrumSteve
    Registered Users, Registered Users 2 Posts: 10,798 ✭✭✭✭


    does anyone else feel the some businesses are using the recession as an excuse to move their operations out of ireland? the SR Technics case being one example.

    It just seems like everyone is packing up and leaving even if they aren't suffering too badly... *aviva* ahem.


Comments

  • #2
    Alcatel
    Closed Accounts Posts: 217 ✭✭Alcatel


    DrumSteve wrote: »
    does anyone else feel the some businesses are using the recession as an excuse to move their operations out of ireland? the SR Technics case being one example.

    It just seems like everyone is packing up and leaving even if they aren't suffering too badly... *aviva* ahem.
    A business has to answer to its bottom line. In certain cases, that means doing what some might term the "patriotic" thing, such as keeping business in a country even when there's cheaper places to go. But that's mainly for some other long term gain.

    At the end of the day, we've priced ourselves out of the market, and even if a company is making a profit here still, if it could be making an even bigger profit by moving to somewhere where the people holding an MBA are earning less than a truck driver here, and they're more productive to boot, then you can't complain.

    Ireland, after all, got the business of these companies by being cheaper than someone else. When Dell set up in Ireland you don't think that we didn't just cheat someone else out of a job elsewhere, did you?


  • #3
    DrumSteve
    Registered Users, Registered Users 2 Posts: 10,798 ✭✭✭✭DrumSteve


    no i wouldnt be naive enough to believe that and i can understand that they have to answer the bottom line. why dont they just say that they are moving becuase its cheaper as opposed to using the recession as an excuse?


  • #4
    Alcatel
    Closed Accounts Posts: 217 ✭✭Alcatel


    DrumSteve wrote: »
    no i wouldnt be naive enough to believe that and i can understand that they have to answer the bottom line. why dont they just say that they are moving becuase its cheaper as opposed to using the recession as an excuse?
    Because there are all of 5 people in the public eye, worldwide, who talk straight.


  • #5
    DrumSteve
    Registered Users, Registered Users 2 Posts: 10,798 ✭✭✭✭DrumSteve


    i understand that man.

    i take it then that there are no laws that compel companies to disclose the full details of their departure?


  • #6
    VO
    Closed Accounts Posts: 112 ✭✭VO


    Shareholders invest money in businesses to make profit not for any patriotic reasons. If they can find a cheaper location then they will relocate or they will ask workers to accept work practise changes which will make them more competitve. In the SR technics case from what I have read an investment of €40 million is needed to upgrade the plant to service new engines as very soon the existing engines which they currently service will no longer be used. If it was my €40 million and the workers would not adapt I would invest in a cheaper location too. It is time that workers realised that the good times are over for the moment and start accepting lower wages and more efficient work practises otherwise we will have no jobs left in Ireland. It is currently an employers market (at last).


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  • #7
    borazal9
    Closed Accounts Posts: 2 ✭borazal9


    By the end of this year or this time next year Commerical real estate will collapse worldwide because shops will be closing all over the place.....and nobody will be renting them and the landlords who dont fully own the buildings yet wont be able pay off there mortages.This will result in more bailouts which will increase taxes again and then credit card companys will collapse needing more bailouts and again more taxes.

    The commerical real esate collapse will dwarf the sub prime collapse so this may be the time to prepare for the Greatest depression.


  • #8
    DrumSteve
    Registered Users, Registered Users 2 Posts: 10,798 ✭✭✭✭DrumSteve


    VO wrote: »
    Shareholders invest money in businesses to make profit not for any patriotic reasons. If they can find a cheaper location then they will relocate or they will ask workers to accept work practise changes which will make them more competitve. In the SR technics case from what I have read an investment of €40 million is needed to upgrade the plant to service new engines as very soon the existing engines which they currently service will no longer be used. If it was my €40 million and the workers would not adapt I would invest in a cheaper location too. It is time that workers realised that the good times are over for the moment and start accepting lower wages and more efficient work practises otherwise we will have no jobs left in Ireland. It is currently an employers market (at last).


    Im sorry but when wasn't it an employers market? i dont recall anyone saying you had to employ certain people. They paid the going rate and when the going gets tough they basically run.

    believe me i understand market forces and all that tripe. but in cases such as aviva which is a customer services call centre surely thats a backward step to move their call centre to a country where english is not the primary language?


  • #9
    Scofflaw
    Registered Users, Registered Users 2 Posts: 23,283 ✭✭✭✭Scofflaw


    DrumSteve wrote: »
    no i wouldnt be naive enough to believe that and i can understand that they have to answer the bottom line. why dont they just say that they are moving becuase its cheaper as opposed to using the recession as an excuse?

    It's partly because business decision-makers are people, and it's not easy for people to say "well, I know this is a big blow to you and your family, Jimmy, but we can make more money somewhere else". So the decision-makers are often lying to themselves as well.

    That's why a lot of things have been achieved down the years by stripping away the comforting pretences and rubbing people's noses in what they're really doing.

    cordially,
    Scofflaw


  • #10
    Alcatel
    Closed Accounts Posts: 217 ✭✭Alcatel


    DrumSteve wrote: »
    Im sorry but when wasn't it an employers market? i dont recall anyone saying you had to employ certain people. They paid the going rate and when the going gets tough they basically run.

    believe me i understand market forces and all that tripe. but in cases such as aviva which is a customer services call centre surely thats a backward step to move their call centre to a country where english is not the primary language?
    When the going rate is set to an inflated price, owing to a variety of factors, and jobs are easy-come and rarely go, it's not an employers market.

    Right now employers can demand lower wages and have a greater pool of talent to choose from when filling a position.

    To be frank, you can't justify paying the kind of wages we pay here for jobs that somebody in Poland, or India, or China is just as qualified and able to do, for less money. That's a free market economy, and that's what's got us to where we are today - good and bad, but even in this "recession" life is still pretty damn good for us versus times gone by. A drop of 10% in living standards still puts us about 90% above the 70's or 80's.

    We have to move into more high-tech, harder to outsource, easier to justify high wages economy. That's why the IDA has such a big focus on biotech.


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