Stemming IT Job Loss

Feds must defend industry in global marketplace.

In this election year, there are 50 bills pending in state legislatures that are geared, one way or another, to cutting down on offshore outsourcing. There are also 15 federal bills aimed, in whole or in part, at curbing what is being called the exportation of American jobs.

If you doubt these totals, check out the list posted on the National Foundation for American Policys Web site.

Job loss is fraught with economic and emotional pain. State and federal governments lose income tax revenue; states begin paying unemployment benefits. Time and money are spent on job searches; sometimes people must retrain or change careers.

The bills under consideration are meant to alleviate these ills. Most, however, are unlikely ever to be voted on, much less passed, said Meta Group analyst Tom Rubel. But politicians feel they have to do something. When you read some of the bills, its clear even some of the sponsors dont hope they pass. That way, they can say theyre opposed to job loss and tried to do something about it without having to take responsibility for causing the prices of goods and services to increase and making U.S. companies uncompetitive globally.

There must be a middle ground; we just need to find it. Even those who decry offshoring generally accept that we cant build an economic wall around the country. At the same time, its unlikely that even the staunchest free-trader would think national security would be enhanced were we as dependent on imported lines of code as we have become on imported oil.

Whats needed is a federal policy that takes the issue seriously—and negotiates seriously with other countries about it. It was encouraging to see that Secretary of State Colin Powell, while in India recently, raised the issue of reciprocal free trade with that country. He noted American concern with IT job loss to India and suggested that India ease barriers to goods and services from the United States. Sadly, Indian officials rebuffed the overture.

Given pressing concerns in Iraq and elsewhere, its doubtful that Indian offshoring will get much more of Powells attention any time soon. However, the State and Commerce departments must do more.

What can the federal government do? An example might be the "voluntary" automobile export quotas agreed to by Japanese automakers a generation ago. While unsatisfactory in many ways, they allowed the U.S. auto industry to survive and recover. U.S. automakers still have plenty of room for improvement, but without an auto industry, would we have the expertise to build Humvees and tanks? Technology expertise is at least as strategic.