According to Rachael King writing in BusinessWeek, the hopes of U.S. workers whose jobs have been shipped overseas now rest with President Barack Obama, who has pledged to keep more jobs in the U.S. On Jan. 16, just days before his inauguration, Obama told workers in Ohio, “We’re not looking to create just any kind of jobs here; we’re looking to create good jobs that pay well and can’t be shipped overseas.”
U.S. corporations will move at least 140,000 jobs offshore in 2009 and 2010, and more than 50% of those jobs will be in IT, according to a December 2008 report by the Hackett Group (HCKT), a global strategic advisory firm that specializes in outsourcing. By 2010, about 25% of all IT jobs at the world’s largest companies by market value will have been moved offshore, according to Hackett.
“An average salary for a software developer in the U.S. is $75,000 and it’s $8,000 in India,” says Mary Jo Morris, president of World Sourcing Services for Computer Sciences Corp. (CSC).
$20 billion in the stimulus package is directed at health information technology and the building of an infrastructure to promote the electronic exchange of health records. That investment will create or retain 86,820 jobs for one year in high-paying industries such as computer hardware manufacturing, software, and IT services, according to the Information Technology & Innovation Foundation, a nonpartisan think tank focused on public policies to advance technological innovation.
The stimulus act also includes another $6 billion to improve broadband Internet access in the U.S. That amount would create or retain 29,892 direct telecom jobs for a year and 8,304 capital equipment jobs, according to the Information Technology & Innovation Foundation. Finally, $11 billion in funds that will go to modernizing the power grid in the U.S. will create or retainrecession, direct and indirect IT jobs for a year, according to the foundation. “IT did pretty well. There’s a real focus on digital infrastructures, there’s real money there,” says Robert Atkinson, president of the Information Technology and Innovation Foundation. “It basically affirmed the commitment that the country’s building out IT networks is important to our future.”
headlines trumpeted the loss of 598,000 jobs last month — the worst in 34 years. what does that mean for Silicon Valley, the home of technology? In order to get a sense of what’s happening with venture-backed startups, peHub talked to a local recruiter, who says it’s worse than the dot-com bust was for the Valley. VCs see this recession lasting a long time, she said, hence the deep cuts.
“In other words,” said Higginbotham, “if you’re really awesome, you might get a job (with a pay cut). Meanwhile, over at Fortune, the pessimists are speculating that this time technology won’t save us from this downturn, alleging that the dot-com bust wasn’t even this bad because that’s when Google was formed.”
“According to the article, technology won’t save us because there are no big new technologies to create jobs and boost productivity — and even if there were, no venture firms are funding them.”
“That’s ludicrous,” said Higginbotham. “The big technologies tied to mobile computing, faster broadband and mobile broadband are going to make people much more productive wherever they are. Cloud computing is going to change the economics of information technology. And all of these innovations are pushing us toward — and giving us the tools to work in — an on-demand economy.”
“I think the way our careers and jobs are going to be managed is part of this change,” she continued. “A larger portion of the workforce (like it or not) is going to look more like freelancers or consultants, working on demand. That change means the government will need to step up with health care for the self-employed, and retirement planning will become an even bigger issue.”
“Either way, the job loss and recession are hitting Silicon Valley hard, and the only way out may be the kind of shift in the way society functions. But if we’re talking about folks bold enough to build companies in their garages, I wouldn’t count them out for long.”
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Tags: broadband Internet access, cloud computing, consultant, CSC, freelancer, Google, health care, hosted online accounting and ERP, India, IT Jobs, IT networks, job losses, on demand, online accounting software, outsourcing, recession, retirement planning, SaaS, self-employed, Silicon Valley, stimulus plan, working on demand
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