Effects of Outsourcing Companies Positions to Low Cost Countries Part 6



Outsourcing High wage Jobs from Us to Low Cots Locations :

Using outsourcing companies for outsourcing of high wage jobs by companies from the United States to lower cost overseas locations is currently contributing to unprecedented levels of unemployment among American electrical, electronics and computer engineers. Off shoring also poses a very serious, long-term challenge to the nation's leadership in technology and innovation, its economic prosperity, and its military and homeland security.  Prudent steps must be taken to ensure that outsourcing, if it does occur, is implemented in ways that will benefit the United States and all its citizens, including high tech workers. To this end, IEEE-USA recommends that:

The Federal Government must collect and publish reliable statistics on the kinds and numbers of manufacturing and service jobs that are being moved offshore.
Government procurement rules should favours work done by companies in the United States and should restrict the outsourcing of work in any instance where there is not a clear long-term economic benefit to the nation or where the work supports technologies that are critical to our national economic or military security.
New U.S. workforce assistance programs should be created to help companies employ displaced high-tech workers regain productive employment and ensure that employed workers can acquire the knowledge and skills they need to remain competitive.
The H-1B and L-1 visa programs should be reformed and new trade agreements should incorporate such reforms. These temporary admissions programs for skilled workers are often used to import lower cost labour and can result in displacement of U.S. professionals, exploitation of foreign workers and accelerated outsourcing of engineering and other high tech jobs previously done by U.S. companies.


  • A coordinated national strategy must be developed by companies to sustain U.S. technological leadership and promote jobs creation in response to the concerted strategies being used by other countries to capture U.S. industries, jobs and markets.
    Federal investments and tax credits for research and development should be limited to work performed in the U.S. R&D that must, by its nature and content, be carried out offshore, is not covered by our recommendation.
    This statement was developed by the IEEE-USA's Career and Workforce Policy Committee and represents the considered judgment of a group of U.S. IEEE members with expertise in the subject field. IEEE-USA is an organizational unit of The Institute of Electrical and Electronics Engineers, Inc., created in 1973 to advance the public good, while promoting the careers and public-policy interests of the more than 225,000 electrical electronics, computer and software engineers who are U.S. members of the IEEE. The IEEE is the world's largest technical professional society.


The Consequences or Impact of off shoring on Banking Industry and Others :
Whether the United States will benefit from the off shoring of jobs will ultimately depend on how the process is implemented. As in all competitions, there will be winners and losers. Potentially adverse consequences include: loss of employment opportunities and income by technical professionals; loss of payroll and income taxes by national, state and local governments; growing trade deficits in goods and services; transfers of investment capital and intellectual property to overseas locations; and increasing dependence on foreign sources for consumer products and defense critical weapons systems. IEEE-USA is particularly concerned that offshoring of engineering, computer science and other high tech jobs could eventually weaken America's leadership in technology and innovation, a threat that has serious implications for our national security as well as our economic competitiveness. Fewer job opportunities and the downward pressures on wages that will occur as more and more scientific and engineering jobs are shifted to lower-cost, overseas locations are also likely to discourage many of America's best and brightest young people from pursuing careers in science and engineering. Offshore outsourcing can also result in intellectual property and sensitive personal data exports, including medical and credit information. And because U.S. laws that protect information and safeguard privacy do not have extraterritorial application, the U.S. government, corporations and citizens will become increasingly dependent on foreign laws to protect their interests. The risk posed to these interests by individuals and organizations who would take advantage of weak laws, loopholes and limited access to enforcement is not insignificant.Worker Shortage


IT faculties in India are already in short supply for IT workers. The All India Council for Technical Education (AICTE), the main body for accrediting post-secondary engineering schools, finds a faculty-student ratio of 1/45 in IT courses at AICTE-approved institutions. AICTE recommends a ratio of 1/15. This faculty shortage will reach critical proportions as MIT's plans to triple the number of IT engineering graduates are implemented.The quality of computer science education will suffer as a result of faculty shortages. Indian undergraduate degree programs are only three years long, compared to four years in North America. Wage scales for IT professionals are increasing as firms seek to minimize turnover. The Indian software giant Infosys reportedly raised salaries by 30 percent in 2003 and 16 percent in 2004. Other firms are providing employee stock ownership plans and opportunities for international travel in efforts to reward staff and keep them from leaving.


Effects of Outsourcing Companies Positions to Low Cost Countries Part 1...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 2...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 3...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 4...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 5...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 7...Read More
Effects of Outsourcing Companies Positions to Low Cost Countries Part 8...Read More


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