Friedman, was of course aware of the spherical shape of our planet, what he was referring to was the globalized nature of today's economy. With the advent of remote technology, high speed networks, and ubiquitous availability of everything technical, businesses began to hire workers in remote parts of the world with minimal setup and labor costs, small businesses and one man shops were able to compete against giant corporations and in a sense, with this new level playing field, the world started becoming more flat.
But did it? It isn't exactly flat when workers in the U.S. cannot afford to live on the same wages that workers in India can live luxuriously on. Truly flat works both ways. In a truly flat world a worker in India would compete on the same level as a worker in the US. Well, with the booming growth in Indian economy and the devastating loss of jobs in the U.S. one might think there is an eventual break-even point. I believe today I found that break-even point.
Last night I posted a small web-dev gig on a popular virtual worker website I have used dozens of times before. This was a very small project and 5 years ago, when I first used this site, I would have probably paid $10 or so for this work to get done. Last night, I put a cap of $40 for this work which I believe will take about 3-4 hours to complete. That's somewhere between $10-$13/hr. Certainly a respectable wage for the developing world where I expected to get many bids from and where the average annual salary is often on the order of $500!
I posted the project just before mid-night and made sure it was accepted by the site before I went to bed so I could pick my developer in the morning and get the work started. I woke up this morning to a slew of e-mails from India, Pakistan, Bangladesh, Serbia and China. Naturally excited I began reading. I was shocked to find comments like:
the bid price is very low.....there must be some reasonable amount.from jaipur, India
Thanks for inviting me on this project. However, I can't accept it in this budget. Sorry.from Belgrade, Serbia
WHAT?!?!?! Are you kidding me? This is Serbia! Where according to Wikipedia the average salary is only $727. And India where the average salary is $1527. $40 is supposedly 5.5% and 2.6% of their annual salary respectively. And all for only 2-3 hours of time. $40, 5 years ago would have bought me at least 10 hours of work from India and perhaps 20 hours in Serbia. I was ready to give up and double the cap when another e-mail came in with a $40 bid. Excited I clicked on the message and almost fell out of my chair. The bid was from a developer who had completed 150 projects with an average rating of 10 out of 10! and ranked #1,479 out of 352,927 (higher than 99.58% of his peers). That's not what made me nearly lose my seat though. It was the fact that this developer was from Albany, New York. I'm afraid I've used too many exclamation marks in this post already or else I would use a dozen just then.
The implication here is that I can get a 10/10 top 1% developer in the US is cheaper than anyone in India or Serbia. It would appear that the world is now finally flat. I certainly hope we are near that tipping point or close to it. Personally, I hate sending work abroad. Aside from the fact that I'd rather have the dollars stay in the states, I know that I have to spend twice as much of my own time managing the communication with a worker abroad than a worker here. I hope this is a start of a real trend.
