The Siberian solution to the world's skills shortage

Click to follow
The Independent Online

What do you do in Siberia in the winter? Answer: you program computers. Well, you do other things as well like, er, drinking, but there is a limit to that fun. Computer programming, by contrast, is the ideal activity for remote communities with lots of clever, well-educated people.

What do you do in Siberia in the winter? Answer: you program computers. Well, you do other things as well like, er, drinking, but there is a limit to that fun. Computer programming, by contrast, is the ideal activity for remote communities with lots of clever, well-educated people.

Novosoft, a US-based web software company, has 230 programmers in Siberia. The quality of their work so impressed a British web entrepreneur, Tim Aspinall, that he founded Novosoft UK and is adding to the programmers' workload with British-based projects. Wage rates are less than half the UK's, and payment is made to the programmers in sterling to a UK bank.

Problems? Mr Aspinall says that the education level of the Russians is excellent and their English is fine. The communications medium? The internet and e-mail, naturally. The point of this little glimpse of the way trade in intellectual capital is growing is to show how the rich developed world is filling its skills gap. Fears about the skills shortage have risen sharply. Our Government is setting up a fast-track immigration procedure for people with much-needed ones.

In Germany, the government wants to reform the country's tight restrictions on foreign labour so it can import high-technology skills. In the US, there is pressure to expand the quota of special visas for technology jobs.

The central issue here is to what extent a skills shortage can be filled offshore, without having to bring people into the country. That is not an argument against encouraging immigration of the highly-skilled. There are plenty of practical reasons to support this, the most obvious being that blocking movement of labour wastes the world's key resource, human capital.

If employers in developed countries are crying out for skilled people and those people would like to take the jobs why should bureaucracy stop them? But there are obvious advantages in not moving people about. One clear economic one is that they can spend their income in their home area, boosting demand in less-developed regions. There are also social arguments for encouraging people not to have to uproot their families, or leave them behind.

So how do you fill a skills gap by moving the jobs to the people? The Siberian lesson - or indeed the lesson of most of the companies that shifted work to other countries, in particular India - seem to well-defined.

One: make sure the sales and distribution of the software products are done locally. In the Siberian example, the marketing is here and in the US. You cannot expect computer programmers, however excellent, to be able to sell their output thousands of miles away without a local office. Two: you need a brand. In theory, the individual is becoming the brand, in the sense that a skilled person can quickly gain a world-wide reputation via the net. But, in practice, most times the only way to sell is via human contact. So production may be global, but sales are local.

Three: maintain quality control. Berlitz, the Swiss-based translation company, uses humans to translate rather than machines - the various electronic translation systems are getting better but still seem to be less efficient than a skilled human. So they have an enormous network of translators, available online. Electronics takes care of the transmission of the input and output and controls the job flow. But people select the people and make sure the quality of the job is up to scratch. (Incidentally, as anyone who has spent much time looking at the English-language sites of non-Anglophone companies, quality control of the language often seems pretty weak.)

Four: cope with cultural differences. The fact that people speak the same language does not necessarily mean they think the same way, and some types of job do not translate from one culture to another. Computer programming may be a global skill but graphic design is not. he Siberian venture demonstrates that graphics don't translate.

Five: there is an enormous opportunity here for agencies. The received wisdom of the web is that it will close opportunities for middlemen. But while some types of intermediary are already being squeezed - travel agents, for example - the need to collect and distribute the output of clever people creates a great new opportunity for intermediaries.

Human skills are much more varied, subtle and complex than is generally recognised. So the need to know precisely which humans can cut the mustard is valuable: finding the right expert, making sure they are happy with their work, making sure they answer their e-mail, seeing they get paid - these services are in increasing demand. We are in the early stages of a revolution in how human skills are sold, and it is impossible to know how far this will run.

Look at the growth of home-working: 10 per cent of people in Sweden, and 7 per cent of people in the UK, do paid work from home. But it is too early to see the extent to which the whole job contract will break down and be replaced by piece-work. The internet does give the ideal mechanism for linking piece-workers.

And as the Siberians are discovering, it is a great way to make money during the interminable winter nights.

Comments