October - 2003 issue > Editor's Desk

By Harvi Sachar

“Giant Sucking Sound” is the title of a story in the recent issue of Forbes, the story of EDS sending white-collar jobs to India. One other magazine just did a special on how U.S. technical future is at stake because all the technical jobs are moving to India. You can open any business magazine and there is bound to be some story about jobs moving to India. Are they moving to India only or India is being made a scapegoat that the normal unemployed American can blame for taking away his job?

Every article that I have seen does mention that jobs are also moving to Malaysia, Hungary, and Latin America and even to New Zealand. But story always starts with how poor India is, how bad the infrastructure is and there are these shining building where educated people are toiling for pennies and taking away U.S. jobs. There are always pictures of Indian office buildings next to the slums. I wonder why these kinds of stories do not come out of China. Relatively, companies have moved much more of their manufacturing jobs to China and the U.S. economy depends on Chinese manufacturing much more than any dependence on India for it’s IT needs. I never seen a story where they show slums of China (I am sure they have it too!) and shining factories where Chinese migrant workers are toiling always for pennies and taking away high paying blue color jobs from the U.S. China only gets mentioned for its potential. Our next-door neighbor, Canada, has been taking away service jobs—BPO jobs—for decades now. We never ever heard any thing about it. Suddenly, when BPO jobs go to India, it’s a big issue for everyone.

Here in Silicon Valley, we have neighbors who have lost technology jobs. Santa Clara country has lost more then 200,000 jobs in the last 3 years. I am sure all these jobs did not go to India. Unfortunately, we have been hearing from more and more unemployed “techies” that they lost their jobs because the jobs moved to India.

Questions that need to be asked are: Do Indian IT service companies do business in a way that all this negative impressions are true? Maybe they are so hungry for free publicity that whenever a U.S. press asks for access, they start singing their low cost advantages and provide numerous photos; they never stop to ask what the focus of story is. There is no dearth of stories of their bringing their employees on L1 visa, pay them Indian salary and make them work in the U.S. There are stories that Indian IT companies ask their customers to sign statements that are not true, so that they bring evermore H1B’s to do the work. Maybe some of Indian companies are being penny wise and pound foolish by not hiring more U.S. based Project Managers, Marketing and PR professionals. If you ask them about what is their unique message, or what is their brand, a common refrain is heard: well, we can do the job cheaper.

We keep hearing that all this bad press about outsourcing does not affect business. Well, it will be affected, sooner than later. When every CIO has to re-think the company’s outsourcing strategy for fear of being termed a “bad” guy if he sources out projects, it will surely have a long-term affect. Major Indian IT services companies who gained the most by talent-cost arbitration now owe it to India to mend their ways and spend some resources to address this “backlash”.

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