Good to know that "by definition" it's "not outsourcing". Failing to fall into that particular narrow categorization makes all the difference to the economies involved.
It is 100% offshoring, people from his local community do not get jobs, it does not help Canada and in a way insulting for Canadians. I'm surprised to see this article making 1st page :(
I'm struggling to understand why this entrepreneur has any moral obligation to hire locally. It's a world economy; the people he is hiring probably need the jobs more than the Canadians he is not hiring. As he says, it is win/win.
The vitriol here on HN against the fact of a globalized free market is somewhat surprising, especially considering that the successful startups will inevitably be competing globally.
I mean no disrespect, but tell me that when you're employer sends your job abroad and all the companies that you apply to only outsource their positions or pay you below market salary how you would feel?
Not everything could be outsourced. But if you live in the place where there's no job I think you should move. I bet there's not so many programmers working in Monaco. Because cost of living there is too damn high. Much easier to get some french programmers.
Globalization is kinda hard to stop.
Good point. OP cannot just up and move to Argentina, where presumably HN followers would pat him on the back for hiring Argentinians. He is being as global as laws and logistics allow him to be.
Again, there is just no particular reason why anyone should expect him to hire Canadians simply because he presently lives in Canada. If he makes a profit on this venture, he will pay Canadian taxes, right?
Being emotional hurt doesn't mean you have a valid factual point.
I would feel "hurt" -- but that doesn't mean I have a right to the job. Anymore than if you are "hurt" when you boyfriend/girlfriend dumps you... it doesn't mean you get to keep dating, it just hurts.
I think of it like a casino. It's offers a service, sure, but financially operates like a black hole by in all likelyhood removing more value from the economy than it creates.
But it's not a black hole. It's profitable company that gathers money from global market (facebook) and sends it partly to Argentina and partly to Canada. Canada still gets positive money flow. Yes, OP didn't create developer jobs(some other jobs he did create) in Canada, but he most probably couldn't start the company if he didn't outsourced, so jobs wouldn't be created any way. And it's hard to judge what has more value, positive real money flow to the economy or several absent vacancies.
I think a lot of the negative reaction has to do with the sense that the employer did it for the wrong reasons and was excusing himself and the insult to his own business community and developer community. Specifically, he says he couldn't justify paying more than his own wage to his employees. Bulls-t. He brags that there was no shortage of talent. Bullsh-t. He could have changed the game, by offering more than a wage, to give just one example, but he chose simply to pay as little as possible and to strictly minimize his short-term expenses and income at the expense of a robust economy. Many business owners happily draw a minimal wage as their business grows, knowing they want long term value in ownership. He is operating his business like a casino.
I would actually place the local staffing at an order of magnitude more valuable to the local economy than the direct positive cash flow into the business coffers, but I'll admit it's subjective. To me, it's the difference between a ghost-town and a self-supporting economy that can thrive because it can stand short-term unemployment.
Sometimes that's the only choice (steal the loaf of bread or starve), but when everyone does it, the effect is not sustainable and he attempts to justify it for hollow reasons.
Furthermore, developers in Argentina are worth as much as their Canadian counterparts, but for whatever reason, they undervalue themselves to the tune of 1/5 and the employer's eagerness to jump on that reeks of exploitation as much as stinginess, adding insult to injury.
I don't know enough to claim he's breaking the law, but (spoken in reference to the recent RBC stuff): "'The rules are very clear. You cannot displace Canadians to hire people from abroad,' said Immigration Minister Jason Kenney." ( http://www.cbc.ca/hamilton/news/story/2013/04/05/bc-rbc-fore... )
Why doesn't it help Canada? Startup is still in Canada, profit goes to the country. And he creates some jobs for Canadians as well. Maybe it would be better if all staff was local, but Canada wins either way. And it's just one of the ways for business: some hire locally, some hire remotely, some do both. It's just business playing by the rules of the country.
Canada would win a lot more, and be more self-sufficient in the global economy, if employers acted in their long-term interest instead of shorting their shares in the Canadian economy.
Yes, but if OP tried to use local employes there was higher risk of failing or not even starting the company. In that situation Canadian economy would get zero. So I don't know what is better.
It also doesn't help Canada since people who live and support the economy by paying taxes in Canada (income, sales, property etc) don't get a paycheck.
It's harder with large transnational corporations since their money flows are much more complicated. But it's globalization. Basically they are force to do that. If it's more economically beneficial to open plant in China and every other car producer does that, GM will lose money not doing that. And ultimately will go out of business (what they almost did any way :). Government can try to change rules to make outsourcing less profitable, but there's WTO and other things (like laws of economy) prohibiting that.
Sadly, I think it's a prevalent attitude so I'm actually happy to see it being shot full of holes, especially in light of the recent RBC (and others) outsourcing stuff.
(Yes, this is sarcasm.)