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.

[USMMA_83]

Are you really a conservative!?! Don't tell me you represent the conservative movement! You are a freking socialist to the core!

[bimbo]

When will the trend to outsource lawyers start?

Good idea … let’s also outsource politicians, teachers, bank managers, CEOs, college professors, etc. Knowing that their jobs are safe from foreign competition, these are the people who support increases in the H1-B program.

It's bad when they download tech workers; it's bad when they send tech work overseas; it's appalling that the tech workers cannot even go to India to apply for their job.

[HiTech RedNeck]

May India live long and prosper. But not at the United States' expense, please.

[bimbo]

that way they'll at least be able to go to whatever country is hiring at the time they get out.

Unlike America, many countries have strict laws forbidding employing foreigners when there are natives available.

[Lefty-NiceGuy]

Ok, so to avoid "political backlashes" what the hell should the GOP or Dems do about the problem. In the olden days we used to throw up tariffs on everything. It's easy to charge a tariff on steal or lumber, but how do you do it on work transfered inside an international corporation?

The old thinking was throw up a tariff(or subsidy) to fix problems in the short term. Then reduce it in the long term till you have free trade again. So once India is closer to our level you open the thing up.

I can only see it possible if corporations are stuck within trade zones. So an American bank can hire an outsourcing firm in India and pays a tariff on the money it pays that firm. Without this kind of free market interaction you'd have no idea how much the call center in Bombay is worth. Of coarse I don't see them chopping up big international conglomerates anytime soon.

Does anyone else have any better ideas? It may take decades for the rest of the world to catch up to the US and EU.

[Lefty-NiceGuy]

"Unlike America, many countries have strict laws forbidding employing foreigners when there are natives available. "

Yeah, but those laws are crap. I work in the EU. My boss had to write a letter saying nobody here can do my job. What is someone going to sue my boss to take my job? These laws only work with well defined jobs where the goverment can say "hold on we have an unemployed X certified guy, you cann't hire that other guy."

[TaxRelief]

You ignore that as Venice and Holland and Britain stopped making things and shifted to service economies their days were numbered as economic great powers.

The Venetian empire's decline was due primarily to over expansion, a currently recognized error in any modern day business model. (Key resources spread too thin allowing intrusion by dominant competition).

Britian's decline obviously can be attributed to the shift to Socialism, beginning with the suffragette movement and the unionization of factory workers.

The decline of Holland began with, the Peace of Utrecht, signed in 1713, ending the War of Spanish Succession. This treaty drastically altered the balance of power between the European nations. While the Dutch were significantly weakened, France and especially England secured much stronger positions, an advantage they consolidated in the Caribbean, the oceans and the Americas over the next four decades.

[FoxPro]

No, I don’t think John the Baptist could get a security clearance in DC now. It has nothing to do with "Some mistake in your past". If you don’t work for a company that can get you a security clearance, you cant get one. And if you don’t have a security clearance, no firm that issues security clearances will hire you. Its almost a perfect "catch 22".

[USMMA_83]

Been following your conversation on this thread. Interesting to say the least. I'm not going to give you any advise at all. I'll just tell you that YOU are the reason you are unemployed not some Indian 6000 miles away. You take the name of Luke Skywalker as your screen name, any idea what a heroic life is?

[USMMA_83]

Great advise homer. Now git!

[USMMA_83]

Glad to see you on this thread. I get more and more worried about the state of capitalism in our country. It's the one think that no other nation can hope to replicate. But we are willingly giving it up for socialism. This thread on FR prooves the point. Scary isn't it?

[USMMA_83]

I don't even know what that means. We are capatilist nation. That's our core belief. Get to grips with that!

[Beck_isright]

"Are you going to tell me that many of our capitalist corporations are not paying big bucks through lobbying to our congressmen? Especially, when many of the congressmen's wives are hired by these corporations that we the American taxpayer are forced to subsidize?"

If I had the millions of dollars it takes to do that to benefit my business, I would exercise my First Amendment right to do so also.

Sadly, the ignorance of the sheeple is what has us where we are today. Soon we will be like Canada, the UK and France. A socialist state with some free market aspects.

[Beck_isright]

"But we are willingly giving it up for socialism. This thread on FR prooves the point. Scary isn't it?"

Terrifying is the phrase that I would use. It is amazing that everyone is running to the government to say "protect me", when the proper thing to say is "get off my back". Imagine how dynamic our economy would be if all tax rates were rolled back 30% plus. But that's only a pipe dream. I'm afraid even FR is infested with the "me toos" who insist on government intervention in everyone's lives.

[RaceBannon]

You dont get out much, do you?

[bvw]

The job situation wasn't that bad in the late seventies, it was bad around '75-'77. When I graduated in '76 it took four months and 150 resumes (by stamped postal mail) to finally get a job. In that one week I got three offers, in the four months prior nada. The job market recovered in the very late seventies and early eighties to the point where turnover in typical IT shops was around 25% a year, because anyone could get a 20% or higher raise by going to another company. Boom days.

There have a few up and down cycles since then. One big aspect is how "picky" the job postings have become over the years, especially so now. Truth is hiring has become way too picky and many great people are shut out of jobs they could easily do very well in. The current down cycle is the worst I ever seen, by far.

[RaceBannon]

If I knew how to weld right now, I could have applied for at least 10 jobs I saw in the last 3 months alone around here.

I was a machine mechanic for years, building flight test rigs for Kaman, operating them, and inspecting parts while under test, these jobs were for simple assembly of machines, ut theyneeded some welding somewhere.

So many people here would just respond,"Well, just go to welding school dummy".

Yeah. Degreed Engineer, just drop all education I had previusly, to go to welding school.

With what money? I am unemployed!!

Too many brain childs here, think they can throw out simple statements of encouragement that have nothing to do with the reality of the situation.

And those 10 jobs? I would have been the new welder, with an engineering degree, who would have been told,"You are just going toleave this job as son as the economy picks up again", like I have been for the last 2 years....

Not joking, I have been turned down for $10 an hour jobs that I begged for! Can't hire a mechanic with 15 years experience because he has a degree and was an engineer for the last 7 years?

[YankeeReb]

I'm not sure what the logic for posting these outdated jobs is. I never figured it out. Maybe it's to get people to view their web site.

Sometimes its to get people to view their site, sometimes it's so they can turn around and say , "There are no Americans qualified for this job, we have to outsource."

[RaceBannon]

I have worked on several campaigns, and only once did I make any money doing it.

Almost all campaigns are volunteer work.