Skip to comments.Sprint plans to send hundreds of technology jobs overseas
Posted on 08/07/2003 5:25:07 AM PDT by Non-Sequitur
Hundreds of Sprint Corp. employees may lose their jobs as the Overland Park-based telecommunications giant moves forward with a plan to send certain technology jobs overseas.
Sprint chairman and chief executive Gary Forsee on Wednesday said competitive pressures had forced the company toward "offshoring" -- the growing trend of U.S. companies relying on lower-paid computer programmers as far away as India and China.
Sprint put out a request for proposals from outsourcing companies earlier this year and has since narrowed the list to two offshore vendors. Forsee said Sprint is conducting site surveys and is in "serious discussions" with the two companies.
"At the end of the day, it's several hundred jobs that could be impacted," Forsee said. "But we don't know what the ultimate result is."
A final decision on how to handle sending the jobs overseas is likely within 60 days.
Layoffs would not be immediate, Forsee said, because moving work to the outsourcing companies could take six to 12 months.
Forsee also said the company hopes to ease the impact of sending jobs overseas by moving some displaced workers to other information technology projects within Sprint and replacing existing contractors with Sprint employees.
Sprint already was considering moving jobs overseas when Forsee replaced William T. Esrey as the company's top executive earlier this year. But Forsee said he made the final decision to go ahead with the request for proposals.
Sprint already uses an offshore company for some customer service jobs. The company has outsourced information technology jobs to U.S. firms for years. But it has resisted sending information technology jobs overseas.
That has changed as Sprint, like other telecommunications companies, struggles with weak sales in what continues to be a difficult economy.
For almost two years, Sprint has been on a campaign to lower costs to compensate for soft sales. Since October 2001, more than 18,000 jobs have been eliminated. Hundreds of contractors also have lost work at Sprint.
Computer programmers and other skilled technology workers have been among the hardest hit, and there remains a severe shortage of available technology jobs in Kansas City and elsewhere.
Sprint's move toward sending jobs overseas will make a bad situation worse, said Rick Kumar, a former Sprint contractor who last year founded a support group for laid off information technology workers.
"The market is where it was a year and a half ago," Kumar said.
Many people still are out of work or have abandoned their information technology careers for other work, Kumar said. But unlike many of his information technology colleagues, Kumar said he does not blame Sprint and the many other companies that have turned to cheaper labor overseas.
"They have to follow the model or go out of business," Kumar said.
That is precisely how Sprint explains its move toward an offshore vendor. When competitors began cutting information technology costs by turning to offshore programmers, company officials said, Sprint was forced to look at following suit.
"We've got to stay on top of our competitive position," Forsee said. Offshoring "has become a significant trend that we hadn't participated in, so we looked at that as a strategy that was important...because of the competitive aspects."
IBM, Microsoft and HP are among the U.S. companies that are sending information technology jobs overseas or reportedly plan to start. Sprint must lower its cost to keep pace, Forsee said. But he knows careers are at stake.
"When you take actions like that, you're doing that hoping to keep the company as a whole strong," realizing that there are "people and careers and jobs at stake," Forsee said. "We try to do that part very carefully. It's not without significant consideration."
Shares of FON closed Wednesday at $14.05, up 1 cent. PCS closed at $5.41, down 36 cents.
Needless to say, I changed carriers on Tues. Glad I did it since they are now sending American jobs overseas.
We get what we (don't) pay for. With price as our main consideration for goods and services, overseas competitors win. First it was manufactured goods, now the service industries are going.
It's getting a lot louder lately.
Management speak from the PHB.
The paleos here will argue that, because you did it they are now sending American jobs overseas.
Asia, India to be specific.
If the individual companies are being forced by the competition to eliminate American jobs, maybe the correct answer is to level the playing field by restoring the properly calibrated tariffs (and maybe reducing payroll tax in exchange)?
And that model, like Japan's template for their economic miracle that has failed, is suicide for America.
At this point I paint Politicians and Trial lawyers with the same brush. Guess they know that and it's one of the reasons they try to pass laws to disarm the American population.
Why not level the playing field by reducing America's fiscal burden of government to, say, Red Chinese levels i.e. a 2X reduction.
Or how about about a flat tax like Moscow?
Americans need to choose between a free market or a centrally planned one that provides free health care for Africa, free drugs for seniors, etc, etc.
The sincerity of those who advocate protectionism, socialism, and communism is not here questioned. Any writer who would do that must be influenced by a political spirit or a political fear. It is to be pointed out, however, that protectionism, socialism, and communism are basically the same plant in three different stages of its growth. All that can be said is that legal plunder is more visible in communism because it is complete plunder; and in protectionism because the plunder is limited to specific groups and industries.* Thus it follows that, of the three systems, socialism is the vaguest, the most indecisive, and, consequently, the most sincere stage of development.
-The Law, Frederick Bastiat
Which tax is reduced in return for the tariffs being raised is almost irrelevant. my personal choice is the Corporate income tax as that adds a benefit of reduced corporate costs that should then be passed on to the consumer in order to keep pace with competition. The payroll tax being offset by tariff revenues would put more money in people's pockets and pssibly also cut corporate expenses for labor here in the USA. Either way the tariff combined with other tax reductions is good for the American economy.
First of all, it won't happen. The US would get hammered by international opinion if we jacked-up tarrifs. Besides, Libertarians and neo-cons would be in the front of the protest marches against any such action because they don't want to pay $10 more for a PDA but would rather see their neighbor laid off and begging for bread.
There is another problem with "tariffs". They really only apply to manufactured goods and not intellectual property, which is what IT jobs really are. Let's say that Microsoft laid off everyone of their developers in the united States and hired nothing but Russians and Indians. So this goofy-looking OS comes back, riddled with back-doors, security breaches and enough bugs to keep the Russians and Indians forever employed "correcting" the problems; they could still sell the shrink-wrapped software without tariffs. Actually, because of our stupid laws regarding the exportation of encryption technology, it would be in Microsoft's best interest to develop all of the crypto outside of the country so that the foreign made code would be exempt from the ban. Our government has placed too many laws and restrictions on domestic business to ever provide for a silver bullet solution to the outsourcing problem.
It is impossible to level the playing-field. The united States has too much infrastructure, too many dependant on entitlements, grants and aid, too many places for our military, too many economic demands around the world to ever be on the same level playing-field with nations whose idea of mutliple use technology is to use their dirt roads not only as transportation, but also as toilets and community recreation centers.
How to handle a gun.
Your citation of Batiat lying about protective tariffs does not advance your case. If you would care to discuss factual cases we can discuss factual cases if you care to merely use this forum to advance your religous belief in the current trade envirornment which is only called Free Trade by those who have a lack of knowledge about the cuurrent trade envirornment expect to be completely refuted with facts not fairy stories or lies like most Free Traders put forth.
Funny, the founders of the united States chose tariffs, aka "protectionism".
There is nothing about the importation of software that inherently makes it immune from tariffs.
So you say.
Why don't you write a potential tariff law that would cover software. I would like to see the language and how it would be defined and enforced.
I would suggest that you reconsider some of your stand on Manufacturing jobs as it is not merely Union jobs being exported mostly to China it is a whole bunch of other jobs when the Chinese maintain 50% tariffs on Americna consumer products (at least some consumer products I ahve not reasearched all of them). Harley Davidson Motorcycles have one fifthe of teh worldwide market share yet they are barred from China by non tariff barriers. They would perhaps be an ideal export to that nation but they are barred.
Much in the same manner as "sports automobiles, apples and oranges" being basically the same thing.
MISSION TO SAVE AMERICAN JOBS
Mr. President your mission, should you decide to accept it, is to recover the 3+ million jobs lost on your watch. You are to find where they went, recover them, and prevent this from happening again.
You have until November 2004 to complete this mission.
If you choose not to accept this mission, or are incapable of performing, don't run in the GOP Primary so another Republican can accept this important mission for America.
American Citizen Voter
PS Ronald Reagan was the last Republican to understand. Ross Perot sent a warning to your Dad but since then all we hear is the mantra, 'Perot gave us Clinton'. Actually your Dad gave us Perot.
I keep expecting someone to start demagoguing this issue, but so far even the Democrats are looking the wrong way, pretending to be blindsided. I don't know what's scarier, if a Dem challenger sees it before Bush does, or if nobody sees it.
I know you are employed but hey we could do worse than Senator Lazamataz. hey we have done far far worse in many cases.
Great. Now prove that .DLL came from overseas and not by some L1s here - the miracle of the internet. How about 85% of the module made in the states and bugfixes and additions made overseas? Reverse the process. Better yet what kind of tariff would be placed on a Linux module developed overseas? Shareware? Freeware? What happens when a process or an algorithm is developed overseas and coded here? Reverse the process. How about the DLLs are applications are written here, but are tested there? Or are written there, and fixed and modified for this market here?
Counting widgets is easy, counting lines of code isn't.
Its a question I face everyday. My department (a branch of engineering) has had Ph.D. graduates go begging for work, ending up working as security guards for car dealerships or driving trucks. They did everything they were told to do to be successful: be honest, work hard, study, go to school, get good grades, and then are told they aren't wanted or needed. There's a perception that the field is "hard", which discourages students from studying it, and then they see that even if they succeed in their studies they'll be thrown away and have no use for it.
There are those who will say, "Good. Tough luck for you. The free market has told you the choices you made were wrong. Get a job, any job, and quit whining. Get retrained or re-educated." But how much more training can you give a person with 30 years experience and is thrown out the door with nothing to move on to? How much more education can you give a Ph.D.? How can a person with a technical career and an advanced degree even hope to get on at WalMart or ride the garbage truck when the personnel officer sees they are highly trained and educated in another field and will jump ship as soon as they can land a job they're trained to do (I know, its happened to me)? How can you ask everyone who is thrown out of their career to start a new business on their own when they need every cent to support their families in a modest lifestyle?
This country is in real long-term danger of becoming a technological also-ran. We're not only losing the current generation of technologically literate workers, we're losing the future generations. No one will want to go into those fields. We won't have the infrastructure anymore. We won't have the human and intellectual capital. Knowledge will be lost, never to return.
My fear is that the future economy will depend on imported technology. Domestically, what we'll be producung is lawsuits, insurance policies to mitigate the effects of those lawsuits, and fried burgers and tacos.
Maybe a tax/tariff based on # of bits in a program/module would help eliminate bloatware.
(But then all the MicroSoft programers would need to be retrained)...
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