COMPUTERS Analysts: Exporting tech jobs threatens economy
Some observers caution that outsourcing could hurt U.S. tech dominance.
SAN JOSE, Calif. (AP) -- Peter Kerrigan encouraged friends to move to Silicon Valley throughout the 1980s and '90s, wooing them with tales of lucrative jobs in a burgeoning industry.
But he lost his network engineering job at a major telecommunications company in August 2001 and remains unemployed. Now 43, the veteran programmer is urging his 18-year-old nephew to stay in suburban Chicago and is discouraging him from pursuing degrees in computer science or engineering.
"I told him, 'Unless you're planning to do this as a path to technical sales, don't do it,'" said Kerrigan, who lives in Oakland. "He won't be able to have a career designing and building stuff because all those jobs have moved to India."
Like many unemployed programmers, Kerrigan blames offshore outsourcing for the sour labor market -- the migration of tech jobs to relatively low-paid contractors or locally hired employees in India, China, Russia and other developing countries.
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.
Undermining U.S. lead?
Some who oppose the trend, which such industry stalwarts as Hewlett-Packard, IBM, Dell and Microsoft are embracing, believe it could even usher in the end of American domination in technology.
"We're giving countries like China and India the support they need to build up their technology industries, and the result could disadvantage us in the long run," said Phil Friedman, an electrical engineer and chief executive of New York-based Computer Generated Solutions, a 1,200-employee software company that targets the apparel industry.
"We outsourced electronics manufacturing. We're closing steel mills. Every week, 400,000 people file for new unemployment claims," said Friedman, a 54-year-old Ukrainian native who immigrated in 1976. "At the same time, we're shipping tech jobs offshore -- it's a shortsighted approach and cheats the American work force."
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.
Critics say it's the equivalent of exporting not just the automobile industry's assembly line jobs -- but the core engineering and car design jobs, too.