30 state governments are offshoring IT jobs
ADVOCACY GROUPS HOPE TO REIGNITE DEBATE
By Karl Schoenberger
Mercury News, Thu, Jul.15 2004
GOVERNMENT AGENCIES IN California and at least 29
other states have contracted with foreign firms for information
technology services, sending jobs and taxpayer dollars overseas, said
a report released Wednesday by labor advocacy groups.
The report, commissioned by WashTech, the Washington Alliance of
Technology Workers, did not estimate the total dollar value of state
offshoring or the number of jobs involved, saying only a limited amount
of the activity could be documented because of the lack of information.
It called on states to require contractors to disclose where their work
is carried out and to create a database of contracts for public review.
WashTech said it hoped the report would revitalize efforts to pass
legislation in California and other states that would restrict
offshoring of state government services. Several such bills have been
introduced in Sacramento but have not advanced.
``This study is going to re-ignite the debate over sending state IT
services overseas," said Marcus Courtney, head of WashTech, a
Communications Workers of America union local in Seattle that represents
high-technology workers. ``It shows how widespread the trend is, and it
will give legislators concrete examples to move their agenda forward."
The report, ``Your Tax Dollars at Work . . . Offshore," was done by the
Corporate Research Project of Good Jobs First, a non-profit economic
policy group in Washington, D.C.
Philip Mattera, who led the research team, said the study involved
``cobbling together" a list of more than 300 mostly foreign companies
that specialize in offshore outsourcing and then comparing that data
against lists of state contractors and qualified vendors.
The methodology was conservative, Mattera said, because it did not count
large U.S. companies such as IBM and Electronic Data Systems that
outsource domestically and overseas. Researchers found 18 companies --
including the major Indian offshoring firms Tata Infotech, Wipro
Technologies and Infosys Technologies -- had captured at least $75
million in contracts in 30 states. Some of these companies were hiring
retired state officials to expand their access to the market, the report
``Even if there isn't a great deal of money involved yet, there is a
symbolic issue here," said Mattera. ``The fact that a state is spending
taxpayer dollars overseas is a public policy issue. So much of this is
unknowable because there's no transparency."
Opponents of legislative curbs on global outsourcing criticized the
report for supporting the view that limiting the trade in services will
protect U.S. jobs.
``I have no problem with transparency in government contracting," said
Harris Miller, president of the Information Technology Association of
America. ``But my sense from talking to CIOs and state officials is that
the amount of IT work going overseas from state agencies is
infinitesimal. We oppose any legislative measure to restrict trade in
this area, because it could hurt U.S. companies bidding on foreign
Dave McCurdy, president of the Electronic Industries Alliance, said
labor advocates ``should be concerned with framing the debate around new
job creation" rather than protecting a small number of jobs.
``But this is an election year, and it's highly polarized with an
electorate that is anxious about job security," he said. ``If you can
reduce a complex issue into a bumper sticker you might win the election,
but you haven't solved the problem of job creation."
© 2004 San Jose Mercury News