Some Facts Behind IT Offshoring

What Microsoft Says:

• “Two heads are cheaper than one.”
• “Pick a project and outsource today.”

What Hewlett Packard Says:

• “We’re trying to move everything we can offshore,” Forbes quoted Hewlett Packard Services chief Ann Livermore as saying.
• “We’re aggressively realigning our resources.” HP already has a presence in India and is also looking to China, which company officials expect to soon rival India for outsourcing services.

What Forrester’s Research Says:

• 3.3 Million service jobs will move overseas with the technology sector leading the way.
• $136 billion in wages will move to countries like India, Russia and China.  Up from $4 billion in 2000.

What the Economic Policy Institute Says:

• “Research shows that the 15 to 25 percent decline in wages can be traced to the effects of globalization,” says Jared Bernstein, a Washington D.C-based economist for the Economic Policy Institute. “This used to be true of lower wage workers, but now we see it occurring with IT [workers].”
• “My best advice is for IT workers to organize,” Bernstein says. “What tech workers lack is bargaining power that protects them from overseas competition.”

What WashTech/CWA Says:

• We must raise our collective voice around this issue.
• If we organize, both at the legislative level and in the workplace, we can have a say in our economic futures.
• If we do nothing, if too many of us are paralyzed out of fear of losing our jobs, it is increasingly likely we will lose them anyways.
• The U.S. Congress should move immediately to study the impacts of widespread IT offshoring.
  

At WashTech, we are alarmed as we watch more and more of our co-workers -- many of them highly skilled professionals in the IT sector -- become unemployed. Or when we have been tossed aside as disposable workers ourselves.

We first thought the economic downturn was to blame and that it would correct itself eventually; thus we focused on actions that would help workers through the hard times, such as extension of unemployment benefits. We now realize that many of our IT jobs are simply gone, perhaps gone forever. We do not see the fuel for a reversal of a downturn—not when so many family-wage jobs are going offshore as part of the globalization process. Indeed, the process of “harmonization,” as described in World Trade Organization terms, calls for open borders for many jobs—from nursing, to accounting, to our own computer-related work.

We note that many companies receive both local and federal tax breaks, yet they plan to take the jobs these tax breaks help create elsewhere. Incredibly, we also see government IT jobs going offshore, including some designated by the Homeland Security Act. Also involved in the globalization process is the use of H1B and other visas, and the practice of setting up companies in the United States to take work elsewhere, so employers can claim to be using US workers.

Globalization around a corporate agenda may very well be good for business, but we are unconvinced that it is good for people pulling in a paycheck, or for the communities in which we live. The path to addressing this complex issue is not yet clear, which is why we are asking for a study by the United States Congress. We hope both the request (in the form of your letter to your representatives) and the study itself will raise the understanding among elected officials and IT workers and will result in legislation that recognizes the needs of U.S. workers.

We will continue to focus on this issue, as our members cite job security as their top priority.

Links:

A new report projects federal spending on information technology

outsourcing services will increase from $6.6 billion to nearly $15

billion by fiscal 2007.

http://www.washingtontechnology.com/news/1_1/outsourcing/19754-1.html

The New HP Way: World's Cheapest Consultants

Quentin Hardy

http://www.forbes.com/2002/12/05/cz_qh_1205hp.html?partner=yahoo&referrer=

Forrester Research reference

http://itmanagement.earthweb.com/career/article.php/1503461