Wired News Outsourcing Report Blames Schools

"A desire for cheap labor is not the primary reason technology companies are turning to offshore workers, according to a new report by the American Electronics Association, the United States' largest high-tech trade association.

The American school system, which AeA researchers charge is failing to provide strong science and math education to students, is largely to blame for lost jobs, according to the AeA's report, "Offshore Outsourcing in an Increasingly Competitive and Rapidly Changing World.""

redux [03.01.04]
International Herald Tribune The silver lining of outsourcing overseas

""How can it be good for America to have all these Indians doing our white-collar jobs?" I asked 24/7's founder, S. Nagarajan.

Well, he answered patiently, "look around this office." All the computers are from Compaq. The basic software is from Microsoft. The phones are from Lucent. The air-conditioning is by Carrier, and even the bottled water is by Coke, because when it comes to drinking water in India, people want a trusted brand. On top of all this, Nagarajan said, 90 percent of the shares in 24/7 are owned by U.S. investors. This explains why, although the United States has lost some service jobs to India, total exports from U.S. companies to India have grown from $2.5 billion in 1990 to $4.1 billion in 2002. What goes around comes around, and also benefits Americans."

The Economist The great hollowing-out myth

"Instead of focusing on jobs lost to the globalisation of information technology, Catherine Mann of the Institute for International Economics in Washington looks at globalisation's power to reduce prices and so help spread new technology, new practices and job-creating investment through the economy.

She uses the example of cheaper IT hardware, one of the main aspects of globalisation in the 1990s. Most of the drop in prices for PCs, mainframes and so on was caused by the relentless advance of technology; but she still thinks that trade and globalised production--all those Dell Computer factories in China, for instance--was responsible for 10-30% of the fall in hardware prices. These lower prices led to higher American productivity growth and added $230 billion of extra GDP between 1995 and 2002, equivalent to an extra 0.3 percentage points of growth a year."

redux [02.10.04]
Economic Times Outsourcing to add 22 mn US jobs

"Diana Farrell, director, McKinsey Global Institute, said, "People in the US are looking at it as a job issue. They are not economists and therefore, they don't necessarily see the whole picture. What's going to happen is that offshoring is actually going to benefit US businesses even more than India." She said it was a profoundly new way of doing things and would change the structure of organisations. Offshore was about global wealth creation and integrating economies, she explained, adding that it would create more high-value jobs in the US than people could imagine today.

Based on the research that the McKinsey institute had carried out, Ms Farrell said conservatively, for every dollar invested in the offshore space, $0.58 was directly saved."

The New York Times The Trend of Vanishing Tech Jobs
[requires 'free' registration]

"MANY American computer programmers complain that they're losing their jobs to lower-paid workers in India. The trend toward foreign "outsourcing" has become a political flashpoint.

But the trend is less frightening and more promising than you'd think from either the angry talk from unemployed programmers or the scary estimates from consulting firms, argues Catherine L. Mann, an economist at the Institute for International Economics in Washington."

redux [01.27.04]
Wired The New Face of the Silicon Age

"Aparna Jairam isn't trying to steal your job. That's what she tells me, and I believe her. But if Jairam does end up taking it - and, let's face facts, she could do your $70,000-a-year job for the wages of a Taco Bell counter jockey - she won't lose any sleep over your plight. When I ask what her advice is for a beleaguered American programmer afraid of being pulled under by the global tide that she represents, Jairam takes the high road, neither dismissing the concern nor offering soothing happy talk. Instead, she recites a portion of the 2,000-year-old epic poem and Hindu holy book the Bhagavad Gita: "Do what you're supposed to do. And don't worry about the fruits. They'll come on their own."

This is a story about the global economy."

Salon What's labor going to do about offshoring?

"If your job has been offshored to another country, where someone else will do it for a fraction of your former salary, should you:

(a) Stand outside corporate outsourcing conferences waving a placard that says "WILL CODE FOR FOOD"?

(b) Start a Web movement or e-mail campaign to lobby the government and other shoppers to stop doing business with companies that send jobs overseas?

(c) Hang up your keyboard and learn a new skill, like massage therapy or nursing, that can't be bought and sold over a phone line with the click of a mouse?

Amy Dean has a more radical, if wonkier, idea."