well isn't this interesting. GE "warning" their investors that profits are in jeopardy if offshoring is curtailed. What this says is that the things Kerry wants to do, basically force more disclosure of offshoring (disallow "hiding" the practice) as well as cut the breaks, *will* have an effect. GE seems worried about Kerry's ideas.
If none of this mattered, as those that support Bush claim (the "nothing we can do" approach)- there would be no need for this from GE.
Outsourcers are sensing the anger
The US political backlash against outsourcing is making companies nervous, with Corporate America beginning this week to warn shareholders that it presents a threat to future profits.
General Electric led the way Wednesday in filings with the Securities and Exchange Commission that alerted investors to the reliance of its insurance division on call centres and back-office operations in India.
Criticism in Washington of offshoring has grown steadily throughout the Democratic primaries, and a number of laws are being proposed to make it harder for companies to move US jobs overseas.
GE, like many multinationals, denies that a job outsourced is a job lost. And it points to its employment levels in the US, steady for 10 years. Still, it has judged the backlash serious enough to warrant an extended warning.
''The political climate in the US could change so that it would not be practical for us to use international operations centres, such as call centres,'' reads an updated prospectus.
It also warns of bills recently introduced in Congress that would require employees of call centres to disclose their locations at the beginning of all phone calls.
''If enacted, this legislation could result in consumer pressure to curtail our use of low-cost operations outside the US, which could reduce the cost benefits we currently realise from using them,'' GE wrote in the filing.
The rising tide of political criticism is also showing up in shareholder proposals. For the first time, GE's annual meeting is to vote on a motion filed by union activists demanding a report into the effect of outsourcing on the company's brand name and reputation.
miami.com |
