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3/24/2006
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Vendors And Politicians Create More Tech Jobs For Foreign Workers

Tech companies expand overseas while Congress considers allowing more foreign workers into the country.

Whether in U.S. offices or overseas facilities, hundreds of thousands of additional foreign-born tech pros will likely be working for American companies in the near future.

U.S. tech vendors CA, Dell, and EDS last week unveiled separate offshore expansion plans that will add tens of thousands of workers abroad within the next few years. Those revelations came on the heels of IBM's announcement two weeks ago that it plans to boost staff in India by 40% within three years, to more than 55,000. The vendors cited lower wages, improving skills, and booming markets in India and China as reasons for expansion in that region.

It's not just U.S. companies that are bulking up with Indian workers. French IT services firm Capgemini, which employs about 4,000 in India, said it's looking to add 2,000 workers there by the end of the year and another 4,000 by the end of 2007, bringing its workforce there to 10,000.

Expanding in India makes Michael Dell happy. -- Photo by Prakash Singh/AFP

Expanding in India makes Michael Dell happy.

Photo by Prakash Singh/AFP
The United States is considering allowing more foreigners to work in this country. The Senate Judiciary Committee, which oversees immigration issues, is expected this week to discuss immigration reform and a proposal by committee chairman Sen. Arlen Specter, R-Pa., to raise the cap from 65,000 to 115,000 on visas the country grants each year to foreign workers, most of them tech workers, with an option to increase the cap 20% annually. Another Specter proposal would create a visa for students pursuing advanced degrees in math, engineering, technology, or the physical sciences. The proposal also would exempt individuals with advanced degrees from the numerical cap on visas.

Indian business publications reported last week that CA is expected within two years to double to more than 2,500 the staff at its Hyderabad technology center. That would bulk up CA's staff to a higher tally than it employs at its U.S. headquarters in Islandia, N.Y.

Dell also is doubling its Indian staff to 20,000 within the next three years. Chairman Michael Dell revealed the plan in Bangalore earlier this month. The company will add the positions "if the Indian market grows the way we believe it will," a Dell spokesman says.

Although India is the destination for the largest chunk of the tech job growth, other countries also are getting more jobs. EDS says it plans to double its staff to more than 2,000 in Hungary by 2009. The Dallas company employs about 1,100 call-center workers in Hungary.

Back in the U.S.
If the proposed immigration changes are passed by Congress and signed by the president, the new cap could take effect in time for the government's new fiscal year, which begins Oct. 1.

That would be welcome news to U.S. employers scrambling to submit their fiscal 2007 petitions for H-1B visas, which the U.S. Bureau of Citizenship and Immigration Services will begin accepting on April 1, six months before the fiscal year actually starts.

The visas run out quickly, and Citizenship and Immigration Services will stop accepting visa requests once it receives about 90,000 to 100,000 H-1B petitions, says a bureau spokesman. Last year, the government received enough petitions for H-1Bs by August--two months before the new fiscal year started. The year before that, the cap was reached on the first day of the fiscal year.

IT employment for non-U.S. workers, here or abroad, isn't popular with American tech workers, many of whom have responded on InformationWeek's blog. In one post, "Keith G" wrote: "It is true that there are some Americans that provide less than quality IT products and/or service. However, I can tell you unequivocally that that number is miniscule compared to what is produced by low-cost offshore IT developers and support [groups]. And it doesn't matter where the offshore folks are from, India, Russia, China, they all are equally bad."

Companies hiring them by the tens of thousands don't agree. And tech industry groups such as the Information Technology Association of America, as well as large companies such as Microsoft, have been lobbying Congress to raise the H-1B visa ceiling. "This is important legislation for competitiveness--market conditions are such that it's difficult to find requisite talent," an ITAA spokesman says.

U.S. IT unemployment was 2.9% last year, according to the Bureau of Labor Statistics, with 3.5 million IT people employed. ITAA contends H-1B workers are paid prevailing wages, and "there are substantial overheads in setting up overseas operations, so it's not just a matter of cheaper labor," the spokesman says.

It's a tough call in an election year; members of Congress have to decide whether to pay more attention to arguments being made by workers or management.

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