Tech Firms: We Must Export Jobs
The "Supreme Being" works in a variety of "mysterious ways," doesn't he?
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WASHINGTON, Jan. 7, 2004
(AP) Worried about possible government
reaction to the movement of U.S.
technology jobs overseas, leading
American computer companies are
defending recent shifts in employment to
Asia and elsewhere as necessary for
future profits and warning policy makers
against restrictions.
"There is no job that is America's
God-given right anymore," said Carly
Fiorina, chief executive for Hewlett-Packard
Co. "We have to compete for jobs."
In a report released Wednesday, the
companies said government efforts to
preserve American jobs through limits on
overseas trade would backfire and "could
lead to retaliation from our trading partners
and even an all-out trade war."
"Countries that resort to protectionism end
up hampering innovation and crippling
their industries, which leads to lower
economic growth and ultimately higher
unemployment," said the Washington-based Computer Systems Policy
Project, whose member companies include Intel Corp., IBM, Dell Inc. and
Hewlett-Packard.
Intel chief executive Craig Barrett said the United States "now has to
compete for every job going forward. That has not been on the table before.
It had been assumed we had a lock on white-collar jobs and high-tech jobs.
That is no longer the case."
Barrett complained about federal agriculture subsidies he said were worth
tens of billions of dollars while government investments in physical
sciences was a relatively low $5 billion. "I can't understand why we continue
to pour resources into the industries of the 19th century," Barrett said.
The effort by the technology industry represents an early response to their
growing concerns that U.S. lawmakers may clamp down on the practice,
known as "offshoring," especially during an election year. Already, some
Democratic candidates have criticized the practice.
Democratic front-runner Howard Dean said during a debate last month that
America needs a president "who doesn't think that big corporations who get
tax cuts ought to be able to move their headquarters to Bermuda and their
jobs offshore."
Sen. John Kerry, D-Mass., introduced a bill in November requiring service
representatives to disclose their physical location each time a customer
calls to make a purchase, inquire about a transaction or ask for technical
support. The proposal targets the increasingly popular decisions by
companies to move their call centers overseas to capitalize on low labor
costs.
A Commerce Department report last month said increasing numbers of
technology jobs are moving from the United States to Canada, India, Ireland,
Israel, the Philippines and China — and predicted that "many U.S.
companies that are not already offshoring are planning to do so in the near
future."
The subject has been the focus of several congressional hearings, and
some lawmakers have asked the General Accounting Office for a study on
the economic implications of moving technology jobs offshore.
The technology group argued in its new report that moving jobs to countries
such as China or India — where labor costs are cheaper — helps
companies more readily break into foreign markets and hire skilled and
creative employees in countries where students perform far better than U.S.
students in math and science.
"Americans who think that foreign workers are no match for U.S. workers in
knowledge, skills and creativity are mistaken," the trade group's report said.
Even as technology companies lobby against limits on offshore
employment, they are urging the Bush administration to approve new tax
credits on research and development spending, spend more on university
research on physical science and adjust tax depreciation schedules for
technology purchases. They said they also want improvements in
education, especially in elementary through high schools.
A vocal critic of technology companies moving jobs overseas, Marcus
Courtney of Seattle, dismissed the latest report.
"This is not a recipe for job creation in this country," said Courtney, president
of the Washington Alliance of Technology Workers. "This is a recipe for
corporate greed. They're lining up at the public trough to slash their labor
costs."
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