IBM criticised heavily as US website attacks corporates that offshore jobs

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I read an article in the New York Times at the weekend. It was about a new website created to name and shame US corporate that have offshored work, amongst other things. The AFL-CIO which is a federation of unions has created a website which contains a job tracker.

You put in a post code and it tells you about the outsourcing of jobs at companies within a specified area. Here is the site.

The AFL-CIO has also done a major report about some of the damage being done by offshoring to US workers and economy. It criticises IBM in the report (see below).

Here is the "Sending Jobs Overseas: The Cost to America's Economy and Working Families" report as it is titled if you want to read it.


I will go through the report and blog about it but just for a taste of its tone, here is the first paragraph:

"Outsourcing of jobs to foreign countries is one of the great hidden economic issues of recent years. It is big business, with multinational corporations actively shifting jobs out of the United States and around the globe in search of the cheapest possible labor. But, following popular outcry against the practice in 2004, corporations have done their best to hide the details even as they expand their offshoring activities. As a result, outsourcing has by and large fallen out of the headlines."

This is what the report says about IBM:

"IBM: Outsourcing Out of Sight

IBM has been a global leader in technology for decades. More recently, it has become a leader in the twin practices of outsourcing jobs and of hiding that activity. In 2005, IBM and its wholly owned subsidiaries reported 329,000 employees worldwide. Almost 134,000 of those workers--more than 40 percent--were located in the United States. At the end of 2009, though IBM's workforce had expanded to include almost 400,000 employees worldwide, only 105,000--just over a quarter of its entire workforce--were located in the United States. IBM is reported to now be the second largest employer in India, with 120,000 to 130,000 workers.

The movement of IBM jobs overseas is difficult to track due to the corporation's focus on secrecy in this area. Though IBM's domestic operations have shed a net total of nearly 30,000 employees since 2005, the company simply reports its nationwide total cuts, trimming smaller numbers from scattered sites to avoid triggering mass-layoff notification laws. The company no longer reports its employment numbers in geographical terms, making it difficult to discover where the company is hiring or where U.S. jobs go when taken offshore.

IBM workers whose jobs have stayed in the country have seen reduced benefits and lower pay--new facilities opening in the U.S. are paying up to $20,000 a year less than older centers paid. Meanwhile, CEO Sam Palmisano made over $21m in 2009 while cutting 10,000 U.S. jobs during the deepest recession since the Great Depression."

I blogged earlier about the fact that IBM might cut its permanent staff numbers by three quarters and contract work out. I did a more in depth article about it here if you are interested.

They could do a UK equivalent of this website. But there might be a section about how US companies are replacing UK workers with offshore resources.
 

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This page contains a single entry by Karl Flinders published on October 11, 2010 4:59 AM.

Government IT cost cutting in five big bites was the previous entry in this blog.

European Commission could open the UK's door to Indian IT workers is the next entry in this blog.

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