Proposed Michigan bill to ban
outsourcing contracts
Vasantha Arora (IANS)
Washington, August 12
Yet another
state lawmaker in the US has introduced a
bill aimed at preventing outsourcing of tech jobs to India and other foreign
countries.
Michigan lawmaker,
Representative Steve Bieda, has introduced a bill aimed at
curbing the stream of white-collar jobs leaving the state and heading
overseas.
"A
great number of highly educated, skilled Michigan workers have lost
their jobs because their jobs were outsourced to places overseas,"
said Steve Bieda, a Democrat of Warren, Sterling Heights.
"We
need to work to keep jobs in Michigan."
If passed,
the law would ban the state government from awarding contracts to companies
and businesses that use workers in foreign countries, such as Covansys and Farmington Hills, a Michigan-based
information technology company.
The company
derives 30 per cent of its sales from the public sector. It also has 1,900
of its 4,800 employees in India.
Bieda's proposed law comes at a time when a growing
number of companies are moving work to countries like India, Russia, China and the Philippines to take advantage of
lower labour costs.
"I
understand that the bill is limited in scope because it only deals with
state contracts," Bieda
said. "But we have to make sure that scarce state dollars are invested
at home and in jobs here."
Other states
including Connecticut, Maryland, Missouri, New Jersey and Wisconsin are considering
similar legislation. The move is drawing a mixed reaction.
Covansys CEO
Martin Clague reportedly said such restrictive legislation was a mark of
short sightedness, and hoped it would never see the light of the day.
He was
supported by Harris Miller, president of the IT Association of America,
(ITAA) the Arlington, Virginia-based technology industry trade group.
Miller said
it would be a huge error if the US became a restrictive
society and sets up trade barriers. It would set off a chain reaction and
other nations would follow similar protectionist policies. "We can't
afford to get into a trade war with these countries" he told
reporters.
But a
Seattle-based labour union, Washington Alliance of Technology Workers,
which is becoming increasingly involved in national technology industry issues felt that there was an urgent need for such
legislation.
Washington
Alliance president Marcus Courtney said legislation was needed to protect
American jobs. "This is a trend that companies want to keep
secret."
Donald
Grimes, senior researcher at the University of Michigan's Institute of Labour and Industrial
Relations, said the legislation may mean governments will have to pay more
for IT services.
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