Outsourcing hits US techies hard

Times of India ^ | MAY 26, 2003 | CHIDANAND RAJGHATTA

[Lessismore]

WASHINGTON: On a recent April afternoon in Silicon Valley, moments after he was told he had been laid off from his computer programming job at a Bank of America training centre, Kevin Flanagan stepped into the parking lot and shot himself dead.

Some of America's technology workers, who like Flanagan have also had to collect pink slips over the last several months, think they know why Flanagan took his life: Bank of America not only outsourced his job to India, but forced him to train Indian workers to do the job he had to give up.

In the weeks since his death, the techies have used the incident as fuel to fire a campaign against outsourcing to India, an issue that now seems poised to become a major sticking point between the two countries. Several US states are already considering legislation to ban or limit outsourcing.

Bank of America is one of several major US corporations – General Electric, Microsoft, Intel are among others - under scrutiny for outsourcing jobs to India. The Bank created what is called a "Global Delivery centre" in 2000 to identify projects that could be sent offshore.

Since then it has signed agreements with Infosys and Tata Consulting Services (TCS) to provide solutions and services.

In an e-mail exchange with this correspondent, Kevin's father Tom Flanagan said "a significant reason for which my son took his life was indeed as a result of his job being outsourced."

"Did he blame India for his job loss? No. He blamed the "system." He couldn't understand why Americans are losing jobs. Rather I should say he understood it economically, but not emotionally," Flanagan said.

Bank officials, who did not return calls relating to Flanagan's death, have said in the past that the deal with Indian companies would effect no more than 5 per cent of the bank's 21,000 employees, or about 1,100 jobs, in its technology and operations division.

According to some surveys, the US has lost at least 800,000 jobs in the past year and some 3.3 million jobs will move overseas over the next few years because of outsourcing, mostly to India.

The Bank has also acknowledged that it had asked local workers to train foreigners because such knowledge transfer was essential. According to Tom Flanagan, his son was "totally disgusted" with the fact that he and his fellow-workers had to train foreigners to do his job so they could take over. "That sir is a travesty," he said in one e-mail.

US tech workers are challenging the corporate world's claim that it is outsourcing work to improve bottomlines and efficiency. Some analysts have also pointed out that US corporations were being forced to tighten up by the same people who are moaning about outsourcing, and who, heavily invested in the stock market, demand better performance.

But on one website that discussed the Flanagan case, a tech worker pointed out that data processing consumed only a small per cent of revenues and was hardly a drain on the Bank's profit.

"(It is) a prosperous bank which has let greed trump any sense of patriotism or social responsibility," he fumed.

[Huber]

To everybody who thinks this isn't a hugh problem, you're next. At home, they use diversity to keep you out, overseas they have outsourcing. Ain't globalization great?

Most diversity programs are the antithesis of free markets, while offshore outsourcing epitomizes them. As you illustrate, our corporations apparantly have a pretty severe case of schizophrenia (or would that be a bipolar condition?)

[Pukin Dog]

I think this dog will be just fine.

Dalereed, do you believe this guy? I'll leave him to you.

[TaxRelief]

No one said you don't have to WORK to make money, you just don't need a job.

You can farm, buy a business (with a loan), start a business, consult, design and/or maintain web sites, buy a limo, start a conservative paper, start a nonprofit group with a conservative cause, run a campaign for Republican or write a book.

[blueriver]

Race, without going into your personal situation, do you think times are as bad now as they were in the late 70's?

You are missing the point. This is not about "hard times". This is about the exodus of American jobs to foreign counties. It is a severely destructive trend for the middle class of America. One of the most striking aspects of America was the concept of the "American dream". I find it difficult to believe that anyone with any intelligence would not understand that things are much different now from the 70's. Those of you who think that America can survive this outsourcing bonanza are really not analyzing the situation very well.

[texastoo]

About a month ago, I was talking with an Indian doctor who has been in this country for approximately 20 years. Our conversation was about slavery and prejudice. He then went on to tell me about his niece who is a "computer specialist" in Boston. He said the company is furnishing her with a car and paying her rent. Her salary is $500.00 a month. He said that if she was white, she would be making much more. I told him that this sounds like slavery to me much like sweat shops. He agreed. I then asked him why she would be a part of this. He told me that $500.00 a month is a lot of money in India.

The only difference between slavery of the 1800's and this is that these people are coming here voluntarily. These companies should be prosecuted just like the slave owners and sweat shop operators.

[BlazingArizona]

No reason to shoot yourself, but its coming. I would recommend to anyone contemplating going into generic programming to have a backup skill that can offer the same pay rate.

Yes, and it has to be a skill that can't 'walk', a service where physical presence is required: fry cook, gardener, parking lot attendant. American techies will have to accept a drastic cut in standard of living over the next few years, but we're a resilient people. After all, geek love computers for their own sake, not as a way of making money.

[TaxRelief]

Are ya saying that the best way to approach life is that it is a pleasure? :^)

...and with optimism and with faith.

[Lessismore]

When your job is not only to risk your life, but to train others who are also willing to risk theirs; to take responsibility for turning a young yuppie into a weapon before he can kill himself, and maybe others; to leave your life on hold for six months of the year either at sea, in school or some other nessesary training, and to do it PERFECTLY each time out or lose your job, just how much should you be paid?

No more than is necessary to recruit the required number of new pilots into flight school. Is the Navy having difficulty getting new guys to sign up? If so, they should be recruiting overseas.

[TaxRelief]

A lot of people pay half their salary in rent and 25% on a car- she is actually making $2000 by that measure.

[Luke Skyfreeper]

Man(if you are a man),you are so out of line, you don't even know. You think what you want, knowing that people with more guts than you are still out there protecting your right to be wrong.

The exact same thing about being so out of line that you don't have a freaking clue can be said with 100% accuracy about you.

Your complaint is that the poster you replied to doesn't have a CLUE about your job. You're probably right.

The thing is, YOU don't have a ******* clue about what some of us are going through. YOU HAVE plenty of money -- enough so that you can muse about doing your work "just of r the enjoyment of it." YOU HAVE a job, or at least an income. YOU HAVEN'T spent an entire ******* year looking with highly polished resume for a job, any ******* in your field, only to find absolutely nothing, and be literally unable to support your family. YOU HAVE enough money to get your car fixed if it breaks down. YOU HAVEN'T had to abandon the profession you trained for to do telemarketing at $7 an hour (a job you literally loathe) just to have something for your wife and children to eat.

And yet -- you think you are worthy to judge those of us who have, and you're fully prepared to tell us so, and to subject us to your judgment of us.

And that is why I called you a jerk.

[mylife]

No one said you don't have to WORK to make money, you just don't need a job. You can farm, buy a business (with a loan), start a business, consult, design and/or maintain web sites, buy a limo, start a conservative paper, start a nonprofit group with a conservative cause, run a campaign for Republican or write a book.

Thats all work...but i get your drift.
I guess some folks make money fishing! Anything is possible.
I just cant seem to get the capitol to be able to take risks doing things I enjoy for money. Oh well life goes on.

[nutmeg]

read later bump

[Pukin Dog]

There are no American jobs. We do not own them.

More accurate to say 'jobs in America'.

This country exports Innovation. Consider that no other country could drill for oil, or use solid state electronics, or fly a plane without American Innovation.

I do not worry about some jobs leaving this country, because I trust in this nation's ability to create new and different markets. We have done so before, and we will do so again.

[blueriver]

What they believe is this: How a company chooses to conduct its business and develop its capital is NONE OF THE GOVERNMENT'S BUSINESS!

What they do not realize is that some of us tax paying citizens are sick of subsidizing these foreign workers for the benefit of these corporations. Every state in this country is under a severe tax burden because there are too many people using too many services and it is the tax paying citizens who are being asked to foot the bill.

[RaceBannon]

I was a kid then, went USMC in 1977, so I dont remember any of the problems. Our economy is totally different now, though, the induistrial base here which employed people is gone. I live in Central CT, several companies that employed over 1000 people are all gone for 10 years now, I just did a 5 week job for oneof them, they move to Ohio, NAPCO, only they dont have the same numbers there as they did here, and they forgot to bring the engineering staff with them because they refused to pay them the same as here!

My dad worked at Emery Air Freight, they always did well then, Mom was at Hamilton Standard, they had over 25,000 people there then, they have only 3000 now.

Pratt had over 70,000 people in the 70's, now down to 5,000 or so in the state. All the mom and pop shops that supported them are all under now if they didnt grow out of depending on Pratt for work or Hamilton.

When I got out of the USMC in 81, I put out 50 job applications in 1 month, only got work cause my Dad was a Mason (Those pesky secret hand shakes got me work!)

Then, in 1982, Kaman was hiring again, then the Reagan defense buildup, we were living fat and happy because there was still a Soviet Union.

In 1989, this state went belly up almost, then our governor instituted an income tax in 93. We havent recovered since.

Then, all that work leaving the country, Hamilton and Pratt employing less than 10% of their original work force from the 70's under Jimmy Carter, the insurance agencies doing outsourcing...

I tried to re-enlist many times, I got too big, then, after finally loosing enough weight, they told me last fall I was too old!!

I kick-boxed instead of going to college right after I got out, then, after I tried out for the Olympics in 88, I went to college, and sure enough, they stopped the GI bill that I was supposed to have until 1991!! I was able to collect it until 1989
, got re-imbursement from work, too, but didnt get my AS until 93 due to work constraints.

work record after that, took 787 resumes until I got my first drafting job, 2 years after graduating.

I havent had a steady engineering job in 2 years now, unemployed for 13 weeks so far this time, longest time in 6 years or so, been turned down for 3 manual labor jobs or so, they wont even take an application for some because I have a degree.

If I didnt know God loved me and gave His Son for me, I wouldn't be typing this right now. I have learned that is the only thing I can trust.

[TradicalRC]

While I am sympathetic to your viewpoint, I must say that I have been hearing about the "disappearing middle class" for a long time. I even recall Ghandi saying something to that effect. Does anyone know how long that idea has been around? Specifically, I would be interested in the earliest reference to "the disappearing middle class".

[TaxRelief]

Those of you who think that America can survive this outsourcing bonanza are really not analyzing the situation very well...

Those of you, who ignore history and have no faith in the innovation of Americans, are ignoring critical data.

A free market is what has brought us to this point in time, and doing everything in your power to make the market even freer, is what will continue to make our economy grow.

[Pukin Dog]

Again, you just do not get it, pal.

The only people would do such a job, are the ones that would do it for nothing.

It is getting harder by the minute not to call you something, so I am just going to say goodnight.

[TaxRelief]

Time to get off the pity pot and start putting that brain to use to solve the problems, one at a time.

[BlazingArizona]

What a bunch of idiots to come up with this rationalization for an act of a sick person. It is horrible that this guy had to put his family through this over a stupid job. Oh no..he had to train the Indians...would he rather have had a month less income with someone else training them? Most people hate their jobs, hate when they get laid off, but relish happier moments with their loved ones, and manage not to kill themselves. Brian Williams had a report about a tech guy who was fired and started a business literally scooping up dogshit. He ended up making $100,000 per year with him and his wife doing it. He DEALT WITH IT. I personally know of someone who went from being worth $50 million on paper in 1999 to ZERO, waiting tables, and his wife leaving him. He didn't kill himself.

And let's not think in terms of a single solution, but a series of adjustments that, taken together, will put us back into competition with the Third World. If our IT personnel could be housed in dormitory-style accommodations located in rural places where they can grow a portion of their own food, we might be able to sustain an IT wage of $20,000 per year. If at the same time we devalue the dollar by a factor of four (the process has already started), that wage now looks like $5,000 on world markets, and we're back in competition again.