Foreign Outsourcing Riles High-tech Workers

Soon, when a high tech employee in Indiana applies for unemployment compensation, the paperwork will be processed more quickly because the state’s computers are being upgraded...by workers in India.

When elected officials in the state got a whiff of that irony, they were told by Alan Degner, commissioner of the Indiana Department of Workforce Development, that there is nothing the state can do to withdraw the $15.2 million deal with Tata America International Corp., a branch of a Bombay, India company.

State officials defend the contract. They say it will save taxpayers millions of dollars.

According to the Indianapolis Star, the deal is part of a 10-year plan known as “Energize Indiana,” established to create 200,000 high-tech, high-wage jobs. But, state Sen. Jeff Drozda (R) expressed the sentiments of many in the state when he wrote to complain about how the project was coming. “It was my understanding that ‘Energize Indiana’ was established to create high-paying, hightech jobs in Indiana, not India,” Drozda wrote.

Most of Tata’s 65 contract workers who will work alongside 18 state workers to upgrade the unemployment computers will come from India, according to Tata. Company officials told the Star that it will hire some local subcontractors and do some local recruiting.

The company also said it would pay programmer analysts under the contract at least $36,733 a year. The Star pointed out that federal prevailing wage data used to set up wages under the contract shows that experienced software engineers and programmers in Indiana command $65,187 to $76,274 a year.

The day after the Indiana story was published, a panel of former Silicon Valley workers described their personal experiences to a House Committee on Small Business hearing. Committee Chairman Dan Manzullo (R-IL) set the stage, noting that the U.S. will lose 3.3 million white collar jobs and $136 million in payroll over the next few years to foreign high-tech firms.

Witness Natasha Humphries, a former quality engineer with Palm Inc. now working with the AFL-CIO Department of Professional Employees (DPE), told the committee that she and a group of her co-workers were sent to India last year to train Indian engineers on the company’s quality program. When the U.S. engineers returned to California, they were promptly laid off—all 14 of them—despite company promises to the contrary.

Humphries and her colleagues were replaced by the Indian quality assurance engineers they trained. The Indian engineers will be paid from $2 to $5 per-hour.