Don Manzullo (R-Ill)        Harris Miller

WASHINGTON : Concern was expressed at a hearing before the House Committee on Small Business on Oct. 20 on the “outsourcing of high-tech jobs” to India, China and other overseas destinations. However those who testified before the Committee differed in their views on how to prevent or even reverse the trend.

The witnesses before the committee, headed by Don Manzullo, (R-Ill), were Harris Miller, president, Information Technology Association of America (ITAA); Ron Hira, who chairs the research and development policy committee at the Institute of Electrical and Electronics Engineers (IEEE-USA); Robert Dupree, vice president, American Textile Manufacturers Institute (ATMI); and Natasha Humphries, a software engineer from Santa Clara, Calif.

All those who testified noted that U.S. companies were moving more service jobs overseas because of some crucial advantages. They pointed out that trade barriers were falling, because India, Russia and China and many other countries have technology expertise and because high-speed digital connections and new technologies made it far easier to communicate. Besides this, a Java programmer in India, fresh out of college can be hired for $5,000 a year, compared to $60,000 a year in the U.S. Why be in New York, when you can be 9,000 miles away with far less expense, they said.

Manzullo said moving American jobs offshore could have “serious consequences for the long-term economic viability of this country. The U.S. is in danger of losing its competitive advantage in the technology sector... Even though the U.S. economy has recovered from its most recent recession, it has largely been a jobless recovery.”

To combat the phenomenon, Manzullo urged passage of a bill that would exclude domestic manufacturers and producers from taxation of up to 10 percent. He also advocated a more U.S.-centered purchasing plan for the Department of Defense (DoD).

“It is imperative that Congress strengthen and fight for stronger ‘Buy America’ legislation,” he said. “These provisions include increasing from 50 percent to 65 percent the amount of U.S. content required in major DoD purchases.”

Miller was skeptical that legislation would solve the problem. “ITAA believes that the U.S. cannot legislate or regulate its way out of this perplexing situation,” he said. “At the same time, to do nothing... is to risk an ever-increasing number of knowledge-worker jobs disappearing overseas.” Miller advocated a “detailed analysis of the situation, examination of various policy and programmatic approaches to address identified challenges, and a plan of action to implement critical policies and programs.”

Hira said investment in education would fail without “reasonably secure” career opportunities for graduates. Himself being of “Indian ethnicity,” Hira mentioned how Indian students largely opt for mathematics, science, engineering, R&D, software, chip design and computer technology. So much so they have built a vast pool of highly-qualified technical personnel, making India, a country of more talent than capital.

“And while overseas outsourcing cannot be blamed for all of the unemployment facing American engineers, it certainly is a major contributing factor,” Hira said.

He called for more government spending on education backed by objective appraisals of current careers, as well as innovations in higher and continuing education.

Dupree of ATMI spoke of the loss of jobs in the textile industry. “One out of every four textile jobs in the U.S. that existed in January 2001 has disappeared. So far in 2003, we have already seen another 40,000 textile jobs lost, including nearly 20,000 in July and August this year. And where are the jobs now? In India, China, Pakistan, Bangladesh and Vietnam.”

He blamed the “badly flawed” U.S. government’s policies and its failure to stop unfair and illegal trade practises by China and other Asian textile producers for the “unending wave of textile plant closings and layoffs in the U.S.”

Natasha Humphries, who was laid off recently as a senior software quality assurance engineer, narrated her own personal experience of facing tough competition from H1-B visa professionals and from the offshore technical team in India.

Saying “offshoring has created a devastating economic climate throughout the U.S.,” she sought new legislation with “incentives to maintain high-tech jobs in the U.S.”