August 20th, 2007 
Deepak OUTSOURCING AND EXODUS OF IT JOBS FROM USA TO INDIA
In the United States, India could soon become the next political whipping boy for its trade and currency policies because it has been snaring U.S. hi-tech jobs. Unemployed computer professionals, labour unions and politicians have become alarmed that U.S. companies are moving growing numbers of information-technology jobs to India.
Wire money online to India with Xoom.com for as low as $4.99.
Technology workers staged a protest at a San Francisco conference promoting offshore outsourcing of service jobs to countries like India. The protesters were backed by a unit of one of America’s most powerful unions, the Communications Workers of America. The unit, called the Washington Alliance of Technology Workers or WashTech, was set up to fight the exodus of jobs overseas.
A new group of unemployed computer specialists calling itself The Organization for the Rights of American Workers or Toraw, protested at a similar job outsourcing conference in New York.
These sentiments were bolstered when Intel Chairman warned that a huge number of IT jobs could move from America to countries like India and China in the next decade. The hi-tech pioneer added that his California-based semiconductor manufacturing firm had “no choice” but to continue sending work offshore because of rising costs and the pressure, to increase productivity.
It would be one thing if the protests and dire warnings stayed confined to angst-ridden words, but now American legislators are getting involved. Many smell a populist, potentially vote attracting issue. On October 20, 2004 theHouse of Representatives small business committee held a hearing on the exodus of white-collar jobs.
Only a few years ago, American technology companies were accused of stealing some of the best and brightest engineering and scientific minds from India to meet a severe talent shortage. But now that the global economy has struggled for many months, technology unemployment in the U.S. is high and the jobs are moving to India.
Some industry insiders blame at least part of the unemployment problem on the U.S. Programme of granting temporary work visas to hi-tech workers from India. Many of those who come to the U.S. under this visa scheme go home to set up or work for companies that compete with American companies.
This concern has prompted legislators in at least nine states to join the fight to slow job migration. New Jersey took the lead in drafting legislation after lawmakers learned that a company hired to help welfare recipients had moved its help-centre jobs to Mumbai. Legislation requiring state government contractors to use U.S.-based employees is still stuck in various committees. But the threat of the new law was enough to persuade the welfare-help contractor, funds Corp., to move the jobs back to New Jersey.
A flurry of comparable bills in several states has prompted India’s National Association of Software and Service Companies, an umbrella grouping of some 850 companies, to hire high-powered lobbying firm Hill & Knowlton.
So far, none of the state-level bills have become law. If they did, however, purely on a business plane, it would not matter at all since the bulk of India’s outsourcing comes from private-sector customers, not from government contracts.
CHEAP, TECH-SAVVY WORKERS
Seeking to cut costs, U.S. multinationals such as General Electric, Honeywell and Citigroup have for years moved jobs to India, seeking to capitalize on the country’s inexpensive but technology-savvy, English speaking workforce. Nasscom estimates that job outsourcing to India saved U.S. companies $10 billion-II billion in 2001 and was accompanied by a $3 billion increase in American exports to India that year. This has increase by manifold now.
The migration of these jobs was not a big issue when the U.S. economy was roaring and companies had a hard time filling job openings. But that attitude changed abruptly with the dotcom bust in 2000 and subsequent recession in the industry. Today, despite a tentative recovery, u.s.technology jobs remain scarce.
The exact number of jobs that have moved to India is not known. The Communications Workers of America estimates that 400,000 white-collar jobs have already been lost, particularly to India, and projects that a good proportion of 3 million mere are expected to migrate offshore by 2012 will go to India as well.
Harris Miller, who heads the Information Technology Association of America that includes America’s leading multinationals, argues that the best way to protect U.S. jobs is to promote free trade. He believes that there are steps the U.S. government could take to bolster job growth, including such measures as establishing a tax credit for companies that engage in research and development. Miller also says that the current surplus of hi-tech workers in the U.S. will dissipate as the baby-boomer generation retires.
Others add that sending work offshore leads to important benefits to the U.S. When the US spends $1 in India and China, 65 cents comes back in the form of orders for hi-tech equipment.
Still, the new breed of hi -tech activists can boast of at least one recent success. They helped persuade a majority in the U.S. Congress to let lapse on September 30 a measure that had temporarily tripled the number of foreign professional workers, many from India, admitted to work in the U.S. to 195,000 a year up from the usual 65,000.
Any moves to expand the number of visas for foreign hi-tech workers will likely be opposed by groups such as Toraw.
Posted in 
