Re: The Journal News: Flow of jobs overseas has human toll

[Lou Forlini <lforlini@xxxxxxxxxxxxxxxxx>]

At 11:57 AM -0400 7/29/03, Douglas Handy wrote:
> When a company hires an offshore firm to code a project for them and the
> software is returned via the internet, how should the tariffs be
> imposed?  What
> if the firm provided support or maintenance instead of a new project?
>
> What if it is just a call center which is moved offshore?  For example, our
> small town used to have a call center which employed hundreds of
> people for tech
> support for a major PC manufacturer.  They recently moved the entire operation
> to the Phillipines where they are not putting in a 1600 seat call center.
>
> What do you do?  Add international tarrifs to raise the price of long distance
> to compensate for the labor rate differential?
>
> What wonderful regulations and taxes apply in a situation like an
> offshore call
> center?  The concept of tarrifs seem to be easier to apply to things
> like steel,
> not that it has saved the steel industry either.

Doug,

   I don't know the answer.  In the case of a software company that 
used more than 50% offshore development to create a product, I would 
class the product as an import.  But I'm just as sure that any 
company that would do that sort of thing would also re-classify as 
many US-based executive secretary jobs to "product development" as it 
took to get around any such law.

   In cases like call centers and offshore IT development, I have no 
idea how to fix it.  For the call center, no long-distance tariff 
would work because I'm sure that these companies would think nothing 
of using Internet voice from overseas to a station in the US to get 
around that.

   I would think that in the long run a difference in quality would 
be perceived in the marketplace, but past experience shows that the 
vast majority of consumers are price-conscious to the exclusion of 
all else (they like to complain but won't pay more to resolve the 
complaints).

   So are we all doomed?  Should I pack up and move to India so I can 
get a job in IT?

   Regards,

   - Lou Forlini
     Software Engineer
     System Support Products, Inc.