[AlphaOne]

Well the fact that some companies wanna leave is mainly because the gouverment has put the foot down on all the policy to buy cheap with the promise of investment then fire most of the people and sell the assets of the company for huge amounts of money.

Companies here can no longer just buy something and keep it as it is or run it into the ground they must actualy invest and do something provide good products and so forth.  Also the waiges have been increased. The minimum wage a company can pay has also been increased and any foreign company present has to respect the said minimum wage.

However having said that the average wage is less then 400 euros per month for a skilled veteran worker which can outproduce any novice worker.

They were used to salaries in the 200 Euros per month so when the gouverment upped the salary by about 50% with another 50% in the folowing 2 years to come they decided the pull out. I mean it was all great and nice when workers were working 12-14 hour shifts with a very low salary and they got billion of euros profit per year but when they actualy had to pay more for the workers provide proper working conditions etc. the net profit dropped from billions of euros per year to about several hundred of million per year.


So yeah they have a LOT of reasons to go. I say get them out while we still can. We dont need them. Half the industry that was privatised has either been run into the ground or is in such poor shape after the foreign companies took hold of them its not even funny anymore.

Mika i know about which companie you are talking about and i must say pending this crisis on some sort of financial dificulties those companie have today is unrealistic. No im not talking about you im refering to those analist that say this.

I mean those companie have had record profits and when i say profits i dont mean tens of million of euros im talking hunreds of million even billion of euros per year net profit.

I have a very hard time believing that a company that has such massive profits cant afford to ride out the so called economic crisis . I mean they have no reason to shut down or lay off workers.

[Roanoke]

That was my thinking too. How can banks like HSBC announce profits in the billions over successive years suddenly be in such dire financial situations ? Don't banks have savings accounts ?

[BloodEagle]

Yes. They're called CEOs.

[Mika]

Currently I'm drunken and exceeding my usual go-to-sleep time by several hours, so bear with me.

The companies are like sharks looking for the best possible prey (read: country) to manufacture stuff in the cheapest possible way. However, I don't consider this as a normal behavior for a company, it's more related to getting good ratings quarter yearly in order to fulfil stock holders' wishes for growth (and thus more money). The media here has started to talk about societal responsibility of companies, as they simply cannot lay-off a bunch of people and expect them not to get angry while CEOs collect maximal bonuses. As a sidenote, the current agressive expansionist policy of companies started from the faculties of economy in US universities. (This is actually a fact and again not meant as bashing.)

The average monthly wage is about 200 € in Romania? That's pretty interesting and makes one wonder how the hell can the value of money simply change so much if one takes a step inside other country. I first thought about this when I went to China, me as a student was a rich guy there. I found that already pretty crazy, since I'm not really a rich person in my homeland. It seemed that the products had same relative values with each other as in here, meaning that a house and a car had similar single decade price difference as in here also. But, for me, there was this cheapening factor of 10 since I was using Euros. I still don't understand how that can happen, but I'm no economist. A single world currency would have its benefits. Could it stop this kind of stuff, I don't know, but I hope for it.

About average wage, I would venture and say it is about 2000 € here, but I suspect quite a lot of things are more expensive also than in Romania. As a price comparision, my house was about 100000€, 60 m^2 apartment, sauna included!

Massive profits are shared with stock holders. Only a small amount of the profit is left to the bank.

Mika

[Mars]

I believe the system in which companies have the urge to find the cheapest countries in which to manufacture is called Capitalism. It's caused by rampant consumerism and disregard for long term consequences.

[AlphaOne]

I believe i should make some clarifications.

the statistics say that the average that is medium salary over here is about 500 euros or 600 euros depending on what politician is talking.

However out of those you get anywhere between 100 to 200 euros cut out for taxes. It really all depends and the field you are working in.

also state owned firms usualy pay up more then private companies.

I mean the average salary for a skilled worker with about 6 or 8 years experience in one of our car companies is about 250 euros if im not mistaken.

The minimum wage was about 130-140 euros now its up to about 150 or 170 and will raise a bit more. 


So all in all considering that not everyone works for the state the average salary is between 200 and 300 euros.

Im not counting here the beurocratic industry forgot the name for it with all the state workers  with absolutely HUGe salaries compared to the rest of the population. You know then ones you see at the tax office when you go pay up your taxes and so forts.

thos guis can cash out some pretty decent salaries with minimum of work 3 perhaps 4 hours a day 6 if its a busy day with just 4 working days a week or so... !

Not that is agood job ))

Oh yeah my appartm,ent is also valued at about 100.000 Euros no sauna no nothing . and its about 65 m^2 !

[Kosh]

That was my thinking too. How can banks like HSBC announce profits in the billions over successive years suddenly be in such dire financial situations ? Don't banks have savings accounts ?

They use a technique called mark to market accounting. The link should explain everything, but basically it is one of the tricks Enron used to inflate profits.

[Mika]

100000€ for a house in Romania also? Average wage about 300 € / month? For me this would imply a lot of people cannot realistically buy a house in Romania! Though it could be that I misunderstood something. Or then the Scandinavian housing markets differ radically from Central European ones - which could actually be the case, if my German colleagues were right.

I believe the system in which companies have the urge to find the cheapest countries in which to manufacture is called Capitalism. It's caused by rampant consumerism and disregard for long term consequences.

It is another matter if it is healthy Capitalism. I still don't understand where I got it wrong when I think that should a company outsource in a capitalistic world, every other company is forced to do so also in order to keep up with the competition. When every other company does that, there is no more work performed in the country, no wages paid to people, so people have no buying power. This will eventually force the company into a bankcrupty or to move itself totally away from that country.

This is the world we also have been living here, though the situation is not as nearly as bad as it is in US. The feeling I got as a kid in the 80's was that the companies in general were more responsible towards the society, using different kind of capitalistic corporate policy. Also that we had more state owned companies could have made things more stabile.

Mika

[Mars]

What incentive can companies have to use sustainable practices though (i.e. not outsourcing massively)

consumers by and large are easily bought through advertising, and cannot easily be swayed to see reason. Therefore consumers can't be thought of as an incentive

My guess is that Europeans have much more effective regulation than the US ever had. And China is probably slightly more expensive to ship too and from.

[Mika]

consumers by and large are easily bought through advertising, and cannot easily be swayed to see reason. Therefore consumers can't be thought of as an incentive

I'm not sure about this. Since I have seen commercials pretty much my whole life, I tend to ignore them alltogether. The recently asked me to reply to some of those marketing surveys, while fulfilling the form I realised I had not seen any of the commercials they mentioned. Later, I browsed through some of the newspapers and found out that those adverts really were printed there. But the information of their existance never got to brain and thus were not registered. Also, I didn't recognise brands, something like 90 % of the brand names were unknown for me. So yeah, I'm a merchandising nightmare. The only thing that helps if somebody wants to sell me something is timing and common sense.

Lastly, I know that a majority of people are exactly unlike me in this respect.

Small country and small communities help in keeping the companies in line. CEOs will see very quickly the consequences of their actions and get direct response from the population. As an extreme example, I think some CEO got literally axed to death by angered company worker for laying him off.

Mika

[Kosh]

I believe the system in which companies have the urge to find the cheapest countries in which to manufacture is called Capitalism. It's caused by rampant consumerism and disregard for long term consequences.

On the other hand many of these people have benefited quite a lot from it.

My guess is that Europeans have much more effective regulation than the US ever had. And China is probably slightly more expensive to ship too and from.

It costs more or less the same, I would think. Typically outsourcing isn't done as much from them because of very strict European labor laws.