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US Jobs Migrate Overseas

July 20th, 2003 · No Comments

CNN writes about the impact of outsourcing of jobs to countries like India, China and Russia:

The hemorrhaging of tens of thousands of technology jobs in recent years to cheaper workers abroad is already a fact of life — as inevitable, U.S. executives say, as the 1980s migration of Rust Belt manufacturing jobs to Southeast Asia and Latin America.

But a new wave of technology outsourcing — involving tasks that involve greater skills — could be cutting to the industry’s bone, threatening to prolong the three-year U.S. economic downturn.

Cost-conscious executives have been shifting lower-level tech jobs in data entry and systems support abroad to cheaper labor markets for more than a decade. But now they are exporting highly paid, highly skilled positions in software development — jobs that have been considered intrinsic to Silicon Valley and tech hubs such as Seattle; Boston; and Austin, Texas.

Many U.S. corporate executives say they simply can’t afford to overlook foreign computer workers — especially in India, which produces roughly 350,000 college engineering graduates annually.

Others say the genius of American enterprise is its leaders’ knack for envisioning the next big thing — and workers’ ability to redefine job roles and retrain. Americans pioneering developments in nanotechnology and biotech will have far more job security than simple programmers, they argue.

Bob Pryor, who heads the outsourcing practice of Cap Gemini Ernst & Young, said it’s “naive” to think outsourcing software jobs could ruin America’s tech dominance.

“The reality is that we live in a global economy and we compete against global players. We need to look at where we have strategic advantage — whether it’s resources or skills,” Pryor said. “It frees up people and dollars to do much more value-added strategic things for clients.”

Just this week, AOL announced it was adding 400 jobs in India, and Yahoo was setting up a software development centre in India.

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