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U.S. tech unions gang up against outsourcing

Posted: 05 Feb 2009     Print Version  Bookmark and Share

Keywords:offshoring  IT workers  unions  unemployment rate 

As global tech firms cut jobs in the US and Europe to cope with the economic downturn, IT workers and their unions are aggressively questioning moves to send more work to cheaper locations like India, reports The Economic Times.

Microsoft, which announced first job cuts in its history, and IBM are among those facing a backlash from tech worker unions and policymakers. A union of IT workers at IBM called Alliance IBM has been running a campaign against the planned 2,800 job cuts announced recently by the Big Blue. Washington Alliance of Technology Workers is also one such organisation in the US running such a campaign.

Lee Conrad, national coordinator of the Alliance said in a statement, "The Alliance is strongly urging IBM not to go forward with a new round of job cuts and to stop the off-shoring of US workers' jobs". The Big Blue employs over 70,000 professionals in India.

Consulting group Challenger, Grey and Christmas said last month that electronics, computer and telecommunications companies in the US have cut their workforce by around 186,955 professionals in 2008, up almost 75 per cent compared to 2007.

According to the US Department of Labour, the unemployment rate during December 2008 increased from around 6.8 to 7.2% with almost 20 lakh employees losing their job between September to December.

"Since the start of the recession in December 2007, the number of unemployed persons has grown by 3.6 million (36 lakh), and the unemployment rate has risen by 2.3 percentage points," the US Department of Labour said.

"There is a growing concern among employees that IBM will accelerate the off-shoring of our jobs. To offshore US jobs in the middle of an economic crisis and rising unemployment is simply unacceptable," said Tom Midgley, Alliance president in a January statement. "We will work with our elected representatives to push for legislation that protects U.S. jobs and calls for the full disclosure of IBM's offshoring and outsourcing of American jobs."

Meanwhile, US policymakers are already proposing new regulations to curb offshoring. Senator Chuck Grassley sent a letter to Microsoft's chief executive Steve Ballmer last month asking him to give priority to American workers. "My point is that during a layoff, companies should not be retaining H-1B or other work visa program employees over qualified American workers," he said in his January 22 letter. "Our immigration policy is not intended to harm the American workforce."

However, experts such as Partha Iyengar, Gartner vice president say that unavailability of required IT skills remains a key driver for offshoring.

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