Re: Outsourcing is very scary for all employees now- even teachers.
So you like "outsourcing"? Then you'll love "hybrid sourcing"....
May 6, 2005
Outsourcing: A sea change
By Siddharth Srivastava
NEW DELHI - US industry has long been lobbying to remove immigration barriers for skilled foreign workers. Even Bill Gates recently made a strong case for this. But three US entrepreneurs have done even better: they have hit upon a novel plan to get around the problem - if you cannot fly them in, ship them in. The concept even has a fancy title: "hybrid sourcing".
A front-page report in The Times of India on Wednesday said three American entrepreneurs plan to house an international crew of software developers on a ship just off the California coast. This way, say promoters of the company - called "Sea Code" - US jobs will stay close to home, foreign workers will be saved immigration hassles, and US firms will get competitive rates for their projects. Sea Code will be registered in the Bahamas, hence, not subject to US labor laws. The trio has already identified a $10-million ship called Carousel for this novel venture.
The promoters, San Diego techies David Cook and Roger Green, backed by investor Barry Shillito, a former assistant secretary of defense, say they will hire around 600 programmers from all over the world - including the US and India. "With hybrid-sourcing, Sea Code brings the jobs already offshored back to the US and ensures that 90 cents of every dollar from our clients stays in the US instead of flowing to foreign locations," the company said in a statement. Cook, a sailor-turned-techie, said he expects the venture to sail smoothly: "We're not a slave ship." His partner Green says it will be more like the "International Space Ram Station".
Though it remains to be seen whether the trio pulls it off, the attempt surely is a reflection of the US industry's growing desperation in the face of government policies that limit the immigration of skilled foreign workers. Microsoft chairman Bill Gates recently slammed the US administration's strict limits on temporary visas for technology workers - the bulk of whom are Indians - saying that if he had his way, the system would be scrapped entirely. "The whole idea of the H1-B visa thing is, don't let too many smart people come into the country. The thing basically doesn't make sense."
Gates was reacting to the current annual cap of 65,000 with an additional 20,000 exempt visas (for foreign graduates from US universities), taking the total to 85,000, consequent to the outsourcing backlash. Before 2000, the H1-B program had a visa ceiling of 65,000 but was increased to 115,000 in 2000 and subsequently to 195,000 for a period of three years, during the tech boom. But after the three-year period ended, the H1-B cap was brought back to the original 65,000 per year because of protests by American workers in an election year. Last year, the quota was exhausted on the very first day the new allocations opened - that's just how desperate US industry is for Indian technical talent.
H1-B is a specialty-occupation visa status under which a large number of Indian information technology (IT) firms send their employees to the US for on-site project development work, popularly known as body-shopping. The US is the prime export destination for the Indian software industry, with more than 50% of the H1-B visas issued worldwide by the US going to Indian professionals. India is also currently the second-largest source, trailing only Mexico, of legal immigrants to the US.
Echoing Gates's words, Microsoft India chairman Ravi Venkatesan said: "there exists a demographic challenge in the US with an aging population, whereas India has [a large number of] dynamic and highly educated youth. It is in the natural interest of both economies to allow this integration of resources and talent. In this day of globalization, dropping artificial barriers such as this is essential to allow [a] free flow of trade and talent to benefit both countries, while fostering economic development at the same time."
US industry has been pushing for a removal of the cap, which has also been opposed by labor unions. Complete America - a coalition of over 200 corporations, universities, research institutions and trade associations - has advocated an increase in the annual cap. The allowance of an extra 20,000 visas for foreign nationals graduating from US universities was a result of its efforts.
As things stand, however, the Bush administration does not seem to be in any mood to comply with the demands of Gates or other US companies. The H1-B visa program is already under fire by unemployed US professionals for "taking away" their jobs. The administration believes that unemployment among US computer engineers exceeds figures in other industries.
Indian information industry czars are predictably happy at Gates' clarion call, which they feel highlights the mismatch between the availability of skills and demand for tech workers in the US, despite the Bush administration's claims. The Indian IT industry believes the cap will affect Indian software firms, which have a large number of clients in the US, though it will also bring more offshore work to India from the US.
Operationally, the H1-B restrictions will curtail the flexibility to reinforce on-site teams at various stages in the software development lifecycle (system requirement studies, testing and implementation phases, etc) if adequate and proactive planning is not in place. Since there is a perception that big companies like Wipro, Infosys, HCL and Tata Consultancy Services have already built robust H1-B "visa banks", with a shelf life of six years, in anticipation of a shortage, it is likely to be the smaller IT firms that will really have to struggle for new business as well as servicing current clients. However, it is believed that if the cap stays on any longer, it will definitely impact the Indian IT industry as a whole.
In a statement, India's software giant Infosys said: "Bill Gates is an icon of American industry. His voice creates a positive cluster of opinion and is a clear signal to policymakers what US Inc wants. Such voices will be more vocal now as you will see the rhetoric fading out. After 9/11 and the resulting security measures, immigration to US, skilled people as well as students, has taken a dip and now [the US] needs more skilled people."
There are other areas apart from the tech sector that are feeling the pinch of the H1-B cap. Reports in India highlight the acute shortage of nurses and teachers, which can adversely affect the US while at the same time opening up opportunities for Indians. According to Stephen S Nuell, president of Nurses for International Exchange, the demand for nurses has escalated so much that the US Congress is set to bring in legislation to make visas to nurses more easily available. Estimates put the demand for Indian nurses in the US at 250,000. Meanwhile, the teacher shortage in the US is estimated at 700,000. Will it be floating hospitals next? Or schools...?
Siddharth Srivastava is a New Delhi-based journalist.
atimes.com |
