500,000 U.S. IT Jobs Projected to Move Overseas by Year-End '04; IEEE-USA Sees Continued Loss in U.S. Economic Competitiveness

7/21/2003

From: Pender M. McCarter for IEEE-USA, 202-785-0017, ext. 8353; e-mail: p.mccarter@ieee.org; web: http://www.ieeeusa.org

WASHINGTON, July 21 -- One-half million jobs, or 10 percent of the U.S. information technology (IT) professionals currently working in IT services firms, will be displaced in the next 18 months as their jobs move overseas, according to Gartner, Inc., the Stamford, Conn.-based research firm. The Gartner projection, in a 15 July research note by Diane Morello, would bring total IT job losses to one million, when added to the 500,000 IT professionals estimated by the Bureau of Labor Statistics to have lost their jobs in the United States since 2001.

In addition, Gartner urged business executives not to "trivialize" the impact of offshore outsourcing on their businesses and employees, stating that executives should pay attention to the loss of future talent and intellectual assets, as well as the potential negative impact of outsourcing on organizational performance.

Commenting on the projection of U.S. IT job losses, IEEE-USA President-elect John Steadman said: "In the rush to cut costs through offshore outsourcing and increased use of guest workers, companies are undermining the U.S. IT profession and are increasing the vulnerability of their core competencies and knowledge base."

Dr. Steadman, who will become IEEE-USA's president in 2004, added: "The emphasis on outsourcing to cut costs may help boost quarterly earnings, but it is also putting our nation's long-term economic competitiveness and national security at risk as we give up our technology edge for short-term profits."

IEEE-USA leaders are also concerned about increased industry reliance on non-immigrant high-tech guest workers resulting in more offshore outsourcing.

According to IEEE-USA R&D Policy Committee chair Ron Hira, "Many high-tech guest workers are brought here specifically to facilitate offshore outsourcing arrangements." Dr. Hira added: "Other guest workers are taking the acquired knowledge of U.S. technology and business practices home with them, combining that know-how with low labor costs to help foreign businesses compete more effectively with U.S. companies."

IEEE-USA is an organizational unit of The Institute of Electrical and Electronics Engineers, Inc., created in 1973 to advance the public good, while promoting the careers and public-policy interests of more than 235,000 electrical, electronics, computer and software engineers who are U.S. members of the IEEE. The IEEE is the world's largest technical professional society. For more information, go to http://www.ieeeusa.org.