Three years ago thousands of tech industry workers lived in daily fear that
their jobs would vanish as quickly as the Internet stock bubble had popped.
While it was a stressful time in IT shops, industry veterans who had been
through previous down cycles could at least take comfort in knowing that a
vigorous shakeout was healthy for the tech sector. The bad business models
would vanish, investors would fund new companies and technologies, and new
IT jobs would regenerate.
But how do you reassure nervous – or worse, unemployed – IT pros these days
when they read every week about more tech jobs migrating to cheaper labor
markets overseas?
Just last Tuesday it was reported that IBM executives argued in a recorded
global conference call four months ago that the company must accelerate its
transfer of professional jobs overseas in order to reduce costs.
“Our competitors are doing it and we have to do it,” Tom Lynch, IBM’s
director for global employee relations, is reported in the New York Times to
have said during the call with other Big Blue execs.
The Times got its copy of the recording from the Washington Alliance of
Technology Workers (WATW), a union that lobbies on behalf of high-tech
professionals. The WATW said it was given the recording by a distraught IBM
employee.
The Times said the recording “provides a revealing look at how companies are
grappling with a growing trend that many economists call off-shoring.” But
other than some unseemly “inside” color (IBM execs fretting about bad PR,
political fallout and unionizing efforts), there are no revelations here.
Everyone knows that U.S. corporations are shifting thousands and thousands
of jobs to China, Russia, India, Sri Lanka and other countries where tech
and service workers come at a fraction of the price. Indeed, a Forrester
Research report forecasts that 472,000 U.S. technology jobs will move
overseas by 2015, up from 27,000 just three years ago.
And it’s not just IBM and its competitors – Microsoft, Sun Microsystems, HP,
Oracle – that are ramping up offshore job efforts. Based on its survey of
executives from 51 software companies, the investment and research firm Sand
Hill Group says 63 percent of software companies are now offshoring work, with
another 21 percent planning to do so within the next year.
The offshoring trend is driven primarily by the desire of corporations to
cut costs. In a tight economy, that’s certainly a strong desire. But the
offshoring trend is creating tremendous anxiety and anger in the industry,
especially among those IT pros in the U.S. who were laid off in the past two
or three years and still haven’t found new jobs.
Jupitermedia’s Datamation Web site on Monday published an article in which
it quoted the CEO of an international outplacement firm warning that the
controversy over offshore job outsourcing “will likely intensify in the
years to come as a shortage of skilled workers becomes more and more
pronounced.”
This assertion — that there’s a shortage of skilled tech workers in the
U.S. — prompted one jobless Datamation reader to accuse the article’s
author of writing “a collection of deceptions, distortions, spin, lies and
anti-American treachery.”
Over-the-top as his email was (he speculated that the article’s author uses
a pseudonym), it reflected a genuine frustration and anger felt by displaced
tech workers who are watching their chances for regaining full-time
employment in their chosen field drift overseas, perhaps never to return.
It’s hard not to empathize with them.
Offshoring technology jobs to cut costs seems terribly short-sighted. It
doesn’t account for the negative effects of ill will on existing employees.
In fact, IBM officials expressed that very concern in the recorded
conference call, worrying that Big Blue’s U.S.-based tech employees would be
outraged over having to train foreign workers who soon could replace them.
Further, development jobs require a teamwork ethic and shared values that
are difficult to maintain when the team is dispersed around the world.
The globalization of the tech workforce may be an irreversible trend. But
companies that fail to account for the human costs associated with
offshoring jobs will pay a price that eventually will be reflected in the
balance sheet.
