If you didn’t read Andy Grove’s “How to Make an American Job” on Bloomberg.com, I want to bring it to your attention.
Green is only one part of building a sustainable business and certainly a socially responsible one. Employment and community development are important values to optimize as well.
Labor activists, social entrepeneurs, local government officials have all been arguing for outcomes that are essentially an broader definition of sustainability.
But Grove is arguing that business should make some calculations that measure the effect on investment returns of off shoring so many jobs. Grove says,
Already the decline has been marked. It may be measured by way of a simple calculation: an estimate of the employment cost- effectiveness of a company. First, take the initial investment plus the investment during a company’s IPO. Then divide that by the number of employees working in that company 10 years later. For Intel, this worked out to be about $650 per job — $3,600 adjusted for inflation. National Semiconductor Corp., another chip company, was even more efficient at $2,000 per job.
Making the same calculations for a number of Silicon Valley companies shows that the cost of creating U.S. jobs grew from a few thousand dollars per position in the early years to $100,000 today. The obvious reason: Companies simply hire fewer employees as more work is done by outside contractors, usually in Asia.
The full Bloomberg opinion piece.
photo credit: Tony Avelar/Bloomberg News