'Offshoring' is political dynamite

Oct 06 2003 by Brian Amble Print This Article

The mainstream media in the USA and UK is finally waking up to the fact that the exodus of well-paid, skilled jobs from the US and Europe to cheaper offshore locations is about much more than call centre jobs.

As middle-class, middle-management roles are shipped abroad, ‘offshoring’ is an issue that could become political dynamite.

A lengthy piece in yesterday’s Sunday Times quotes figures from analysts Gartner estimating that 750,000 British jobs will go offshore, including about 50,000 from senior management, over the next decade, a trend that Glaxo Smith Kline’s chief executive, Jean-Pierre Garnier, describes as representing “a significant public-policy challenge for governments and societies, especially in the US and Europe.”

Three million jobs have been lost in the USA since 2001, most of which will never come back, and Forrester Research predicts that a further 3.3 million will disappear overseas by 2015. So is the logical direction of this profound structural change a job market that consists of the very rich and the very poor with little in between?

Maybe not. Even as global companies coin ever-more bizarre phrases to explain 'offshoring' - Craig Barrett, CEO of Intel, told the New York Times that "to be competitive, we have to move up the skill chain overseas," whatever that means – a feature CIO magazine suggests that this a policy that has the potential to alienate large sections of society.

"A CIO at a famous Fortune 100 manufacturer has a recurring nightmare: As he continues to lay off American IT workers and move their jobs offshore to places such as India, never to return, American public opinion suddenly swings violently against globalization. He and his company are demonized, and Americans boycott his company's products."

But then again, as Gartner points out, offshore outsourcing is only just beginning to hit the mainstream, while Deloitte Consulting says that we may only be seeing the beginning of "the flight of service industry jobs".

If this is so, then both governments and global corporations had better watch out. As one comment on the CIO magazine piece put it:

"To me it just underlined all the mistrust corporate America has instilled in many of us. I once was a fat happy tax paying career-driven techie. Now I watch from the side lines as our future is being sold down the river.

PS the first thing I retooled is my spending habits. The car better last ten years. The computer is the same one for the last five years. I averaged 25,000 in taxes a year… Not anymore."