YOU ARE HERE: LAT HomeCollectionsLabor

The Nation | COLUMN ONE

He'll Take Your Job and Ship It

Atul Vashistha's firm helps U.S. companies cut costs by sending work abroad. Sorry, he says, but it's a case of move up or lose out.

April 27, 2004|Warren Vieth | Times Staff Writer

SAN RAMON, Calif. — Atul Vashistha might help move your job overseas one day. He would like you to understand why.

Vashistha, 38, is one of the leading practitioners of "offshoring." His San Ramon consulting firm, neoIT, helps U.S. companies cut costs by sending work to India, the Philippines and other nations with cheaper labor. By his own estimate, Vashistha's deals are providing wages to 50,000 workers overseas. Many of those paychecks used to go to white-collar workers in the United States.

Since he was a boy growing up in India, Vashistha wanted to be a global entrepreneur. To get from there to here, he rejected tradition, devoured new information, sought out opportunities and repeatedly retooled himself to respond to changing circumstances.

If he can do it, he says, so can you.

"If you're a Web programmer, I'm sorry, you have no right to think you can keep your job in the U.S. if you're using the same technology that existed four years ago," Vashistha says. "You've got to keep moving up. You've got to keep going back to school.... If you're not going to do that, you're going to lose your job."

It is a stern warning, and one likely to antagonize the growing ranks of white-collar workers whose careers are at risk. With the U.S. economy only beginning to emerge from a three-year hiring slump, the migration of American jobs overseas has become one of this year's most explosive political issues.

President Bush is under fire for not doing more to fight it. His chief economist was pilloried for defending it. His Democratic challenger, Massachusetts Sen. John F. Kerry, is promoting new tax laws to slow it down. Angry workers are threatening to seek vengeance for it at the polls.

In the midst of the melee, Vashistha has stepped forward as an apostle of offshoring, corporate shorthand for shifting jobs abroad. In his view, it's important for workers to hear the truth -- even if it hurts.

Like it or not, Vashistha says, Americans are now part of a global competition for labor. With the advent of the Internet and high-speed telecommunications, virtually any job that can be done at a computer or over the phone can be moved to countries where wages are much lower. And U.S. companies that resist the trend, he says, will be swept away by rivals.

That may spell disaster for workers who are cast aside, Vashistha acknowledges. But there is good news too: In the long term, companies that save money this way will generate new jobs, he says, which will go to workers who are willing to reinvent themselves.

When businesses save money, consumers also benefit through lower prices. It's part of the continuing cycle of creative destruction that has made America the world's wealthiest economy, Vashistha argues.

For some workers, Vashistha's arguments ring hollow. Clifford Cotterill is one of them.

A software engineer for one of the companies on neoIT's client list, Cotterill, 55, managed to dodge several previous rounds of workforce cuts. But he was recently told his job would be sent to India in May, three months shy of the date he would qualify for early retirement.

"I've always taken classes, picked up new technologies. I have pages of training I can include on my resume," Cotterill says. "They're not really being honest."

Vashistha says he empathizes with workers like Cotterill. But he knows there's not much he can say about the long-term benefits of globalization that would solve the immediate problems of people who get ground up in its gears.

"It is very painful, and I understand that," he says. "To tell somebody who is 55 years old ... you've got to go back to school. But that is the new reality of being competitive."


Every year, 30 million jobs are destroyed in the United States. Businesses go bust, companies downsize, factories automate. Some workers get pink slips; others retire and aren't replaced. In a good year, however, the economy creates 2 million more jobs than it consumes.There are no official data on the number of jobs sent offshore by U.S. companies, but some experts estimate the total to be about 300,000 a year. If they're right, the practice accounts for 1% of job loss in the U.S.

So why the fuss? Because the last three years haven't been good ones, leaving the economy 2 million jobs in the hole. And for the first time, it's not just blue-collar jobs that are being shipped abroad. Analysts estimate that as many as 14 million white-collar jobs are vulnerable.

The potential casualty list includes clerical workers, administrators, programmers, analysts, accountants, auditors, telemarketers, researchers, tax preparers, technical writers and even economists. In only a few years, this displacement of jobs has created a new class of anxious -- even angry -- Americans.

Every morning, as he signs on to his computer before sunup, Vashistha hears some of their voices.

Los Angeles Times Articles