Bank Of America Expands In Costa Rica While Firing People In The USA
Even though "Bank of America has said it's cutting 42,500 jobs," their "offshore operations have grown sharply in the past two years, exceeding 14,000 employees in India, the United Kingdom, Mexico, the Philippines and Costa Rica."
The Bank of America's credit card and mortgage collection department - which was acquired from Countrywide Financial - is located in Costa Rica and will be hiring another 200 staff in addition to the 600 it already has. The majority of the staff in Costa Rica (70%) are 18-25 years old...
In Costa Rica, these jobs pay between US$1,100 - $1,500 per month depending on their English language skills and experience however, purely from a financial standpoint that's still a lot more attractive for a US company trying to cut costs if the alternative is to hire someone in the USA.
Knowing the irony of life, no doubt at some stage, some young worker in Costa Rica will be calling to collect overdue payments from a fired employee of Bank Of America who now owes money because they're doing the job that they used to have for five times the salary of the worker in Costa Rica.
So while one young Costa Rican worker is trying hard to create a good life for himself and his family, the other ex-Bank Of America employee in the USA is desperately trying to salvage what's left of his professional career.
"Ron Hira, a professor at the Rochester Institute of Technology, said offshoring will continue growing unless the Obama administration or Congress takes action. Companies looking to cut costs and boost profits, for example, can pay an accountant in India $5,000 a year versus $60,000 a year in the U.S., he said."
On another corporate topic, the medical device company Baxter which has 1,450 employees in Costa Rica announced this week that they will be expanding their operations because they are moving all of their Latin American financial and accounting operations to Costa Rica.
The President of Baxter for Latin America Carlos Alonso said that: "For Baxter, Costa Rica is very important because of the quality of the workforce, it's stability and geographic and cultural closeness to the United States."
Written by Scott Oliver, author of 1. Costa Rica Real Estate Scams & How To Avoid Them, 2. How To Buy Costa Rica Real Estate Without Losing Your Camisa, 3. Costa Rica's Guide To Making Money Offshore and the Director of Costa Rica Living & Retirement - Secrets To Happiness, a new DVD which reveals all with 14 in depth interviews...
Most Helpful Customer Comments
The global elite who walk on clouds, have bricks of ice where the rest of us have a heart. The facts are that the "plan" is to break the US middle class and homoginize them with the rest of the world. I would be in Costa Rica if not for an elderly mom whom I won't leave. Some day I will be there!!!!
Those of us who hire workers in Costa Rica and comply with all requirements know that you have to multiply a worker´s direct salary by approximately 1.48x to get the total cost. I wonder how this multiplier works in various U.S. states or other countries. Anyone have thoughts on this where you hire? Starting with a low wage structure helps, but even more helpful, I think, is the generally high level of education found in Costa Rica. This greatly benefits those Costa Ricans who learn English, as there is definitely a two tier labor market, with and without English.
As far as being practical Costa Rica is still a safe haven for me. While my retirement and social security continues to dwindle in the US, the US dollar still has alot of purchasing power in CR. Wher the taxes are low, housing is very reasonable and food is inexpensive. While the costs of these staples continue to grow in the USA in a few years how will I be able to afford them? The Banking system makes me sick. How many families in Detroit were foreclosed upon and their houses sold for $500. Anyone that is concerned about their future should be looking at CR now. While property is cheap and land contracts abound now is the time to buy and live the rest of your life in safety and peace.
Yes, it is complex and people need to be educated about the issue. Big corporate money squeezes out more money ruthlessly overseas!
THINK THAT IT IS GREAT THAT BANK OF AMERICA WILL BE IN COSTA RICA,WAS CONSIDERING MOVING THERE THIS WOULD BE A GREAT HELPAS HAVE DIRECT DEPOSIT. ON DOWN SIDE THE LOST OF THE JOBS IN THE STATES IS NOT GOOD AT THIS TIME DUE TO THE PROBOLMS WITH JOBS HERE ETC.
The problem with off-shoring this type job is that the profits that create these jobs come from doing business in the U.S. Without those that are employed in the U.S. economy and with credit cards and mortgages in the U.S. those jobs would not exist.
For every job that is exported there are less jobs in the U.S. and the market from which these jobs are exported is diminished. It is a matter of cutting short term costs while destroying long term profits.
The problem with the U.S. government is that nobody in power has a clue. Currently if you are in a tech or IT business and over 40 your job is in jeopardy as there is serious ageism in these industries at the same time that these jobs are being exported. On the other side of the issue is when manufacturing jobs are lost the government sponsored retraining is for IT and tech jobs. . the SAME jobs that are being exported OR being turned over to youthful employees that accept lower pay. People that have just lost their jobs are being trained for jobs that they are too old for OR are being exported. . .
This is one of many complex issues that nobody understands or is addressing. I suspect nothing will change until things are much much worse.
Since I believe in world wide free enterprise this makes total sense. The only thing I would add is since once poorer contries are doing better and in fact able to attract jobs from US it seems only prudent the US goverment should eliminate any foreign aid or military protections from countries that seem to be doing quite well without our help.