Dr Eamonn Butler, director of the Adam Smith Institute, argues that the outsourcing jobs to foreign countries promotes an efficient economy.

It's no use sobbing - if someone else can do a job cheaper than you can, then you must cut your costs or find another line of work where you have the edge over the competition.

That's hard reality. But it's also the most efficient and sustainable way to run your economy.

The fact that HSBC is moving 4000 back-office jobs to India and China shocked us because we now realise that we face real competition in services. We're used to manufacturing jobs going to the Far East. When James Dyson decided to build his machines in Malaysia, few people outside Malmesbury were very surprised. But we're supposed to be good at services.

And we are good at some services - tourism, for example, or education. But we've priced ourselves out of back-office jobs which - thanks to plummeting IT costs - can be located anywhere in the world.

Five years ago, the UK was investors' favourite location. Now that is no longer true. Taxes in the UK are rising faster than anywhere in the EU, and business now faces a raft of costly new regulations such as the minimum wage, the working time directive, parental leave and the part-time workers directives.

And let's face it, many of the jobs we're mourning only existed because governments threw subsidies at them. Why are so many of the threatened jobs in Wales or Scotland? Because the UK and the EU has long subsidised firms to go to Wales and Scotland. But it never works in the long run - not with steelmaking, nor with microchips, nor with call-centres.

Indeed, the trouble with trying to protect yourself against world reality is that you get stuck in the subsidised hole you've dug for yourself. Meanwhile, other people are doing things better, faster, cheaper. So customers want their goods and services, not yours. You'd have been better moving on to something new.

Still, there's a certain schadenfreude in this. India, with its educated and English-speaking workforce, has prospered from call-centres. (American frequent-fliers tell me that Indian call centres even give operatives US newspapers and TV, so they can chat knowledgeably to customers about the latest baseball scores.) But now, India has started to lose jobs to even lower-cost countries elsewhere.

Let us spare a thought too for the people in these poorer countries. Shoemaking used to be Northampton: now it's Nike. Critics call them "sweatshops", but in Vietnam and Malaysia absolutely everyone wants to work in the Nike factory, and get their family in there too.

It's far better than eking out a living from mosquito-infested fields under the hot sun all day. And if those poor people can move from subsistence agriculture to being able to own a few things that we take for granted - a TV, say, or a bicycle (some Nike veterans can now even afford a small car) - then should we really begrudge them?

It's a big and competitive world out there. The only sustainable strategy for the long term is to cut your costs - and move on.

This article first appeared in the ePolitixPlus financial services sector bulletin.