The outsourcing of work to India and a handful of othercountries is the most talked about loss of American jobs since Japan took overthe auto industry in the 1980s. But how many, and what kind of jobs is itreally costing US workers?
Both the Obama and the Romney campaign have tried to makeoutsourcing an election issue, demonizing Indian workers and promoting a kindof xenophobia that would be universally decried if it were directed at actualimmigrants.
“... Companies that Romney invested in were dubbedoutsourcing pioneers,” former Ohio Gov. Ted Strickland said recently, in aspeech that drew attention here from some national newspapers.
“Now, you know our nation was built by pioneers, pioneerswho accepted untold risks in pursuit of freedom, not by pioneers seekingoffshore profits at the expense of American workers here at home.”
Notably, an analysis of Joe Biden's speeches along the samelines concluded that he deserved “four Pinnochios” for fudging the facts,according to another daily. But never mind that.
Outsourcing is not happening because of tax breaks. Orbecause of some Scrooge figure at Bain Capital. It's happening because of verysimple economics: Companies move work to places where labour is cheap. That'swhy your shoes say `Made in China’. And no matter what nonsense the twocampaigns spout, it's not going to change one bit in November, as an Obama aidepoints out in another story getting heavy play here in India.
"It is important to recognize that insourcing,outsourcing, supply chain complexity, supply chain disaggregation, is here tostay," a national paper quoted Laura Tyson, former Clinton AdministrationChair of the Council of Economic Advisors and now an economic policy advisor tothe Obama Campaign, as saying on the sidelines of the DNC.
But don't try telling that to the man on the street.
On my visits to the US, I never fail to hear some storyabout a telephone conversation with a call center worker “someplace in India.”Jokes about help desk workers with “funny” accents and Americanized namesregularly recur on the worst type of US sitcoms. And even Joe Biden ” whocaptained a month-long attack on Romney's purported support for outsourcing inthe lead-up to the Democratic National Convention ” made an ill-thought attemptat a bastardized Indian accent back in January.
The truth about outsourcing is that the guys named Raj wholittle old ladies from Arkansas have trouble understanding are a pretty smallpiece of the pie. As more and more countries like the Philippines compete for aslice, Indian firms are increasingly moving up the value chain to takehigher-end jobs from American workers. Meanwhile, outsourcing firms are alsostarting to create US jobs ” just like the Japanese companies who whipped Fordand GM eventually moved production to the American South.
According to another national daily, India's businessprocess outsourcing sector, worth some $16 billion and accounting for 37percent of the global BPO pie, is now focusing on high-end work, as thePhilippines has already overtaken India in the “voice” segment and China isemerging as a serious competitor.
Meanwhile, a business weekly reports that countries like Argentina,Brazil and Poland, where wages are still substantially lower than they are inthe US, are also competing for white-collar outsourcing work.
“Even Tata Consultancy Services (TCS) ” India’s outsourcingleader, with estimated sales of $9.8 billion in 2011 ” has 8,500 employees inSouth America, including Peru and Paraguay,” according to the magazine.
