Studies back firms that outsource jobs

NEW YORK: Two national technology trade groups have launched major salvos in the ongoing war over outsourcing American jobs overseas. The groups argue that criticism of the practice is overblown, and one study states that outsourcing software jobs is actually good for the US economy.

NEW YORK: Two national technology trade groups have launched major salvos in the ongoing war over outsourcing American jobs overseas. The groups argue that criticism of the practice is overblown, and one study states that outsourcing software jobs is actually good for the US economy.

That study, released by the Information Technology Association of America (ITAA) on Tuesday, shows that outsourcing such work increases US jobs and wages, and forces the US economy to perform at a higher level, in addition to bringing other economic benefits.

"We're trying to make sure that people understand the powerful impact of open markets," said Bob Cohen, SVP of communications at ITAA.

The study recommends more government involvement with information technology, such as offering skills training and financial assistance when workers in the field see their jobs sent abroad.

Meanwhile, the American Electronics Association (AEA) has issued a report that says offshoring is just the reality of an evolving global economy, and that it is unfair to single out offshoring as the main cause of job losses.

The AEA is reaching out to business media and public officials to try to defuse what is bound to be a controversial issue during the presidential election.

"We wanted to address this because, in part, the tech industry has the most to lose," said Matthew Kazmierczak, senior research manager. "We want to have an open discussion about how to deal with [offshoring]. Some things being discussed by critics are protectionist and could lead to higher prices or retaliation from other nations."

Kazmierczak noted that 61% of the tech industry's revenue comes from outside the US.

The Wall Street Journal, in an advance story on the ITAA study on Tuesday, quoted skeptics who noted that the survey was narrowly focused on computer-services jobs and not others in manufacturing, call centers, or other areas.

The study, called "The Impact of Offshore IT Software and Services Outsourcing on the US Economy and the IT Industry," was conducted for the ITAA by Global Insight, a research firm in Lexington, MA.

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