In a backdrop of election 2010, we have more spin. NASSCOM, the India offshore outsourcing industry is starting a media and public relations campaign to get your job.
India’s top tech firms, along with Nasscom, are lobbying harder on Capitol Hill and are set to launch a public campaign on hiring more local staff in the US as political rhetoric against offshoring of IT and back office jobs reaches an all-time high ahead of the US November elections.
Hiring Americans is not what they will do in reality. Instead they will contract or hire a few token Americans to point to as evidence they are not committing global labor arbitrage. Labor arbitrage, or squeezing workers for profits, is the entire business model of these Indian body shops.
These same offshorers are buying our elections and controlling our Congress.
Bangalore-based Wipro spent $33,000 as lobbying costs in Q2 this year in the US. Chennai-based Cognizant has spent a whopping $320,000 in lobbying this year.
Now guess which party is completely in their pockets? Republicans.
Some of the intense lobbying and other initiatives are already bearing fruit. Last month senate Republicans defeated a bill aimed at taxing American multinationals moving services and manufacturing jobs to cheaper overseas locations such as China and India.
Look at how intensely NASSCOM is out to defeat Congressional action to stop or curtail offshore outsourcing. The bill was only 7 Senate votes short, but now, with this 2010 election, it appears NASSCOM and the U.S. Chamber of Commerce will win. Any Congressional representative who steps out of line against these corporate offshore outsourcing lobbyists will lose. Congress has tried (including Chuck Grassley, a Republican) many times to get something done on labor arbitraging foreign guest worker Visas. Every time they are beaten down by other corrupt members of Congress.
Offshore Outsourcers have hired a former Bush administration official as their Benedict Arnold lobbyist:
Tata Sons currently employs The Cohen Group, run by William Cohen, ex-secretary of Defense in the George W Bush government.
How intensively can lobbyists control our media? Cohen got an Wall Street Journal Op-Ed and a time slot on CSPAN. Yes, our supposedly government public TV source, to spread his purchased lie drivel.
We already know the U.S. Chamber of Commerce, along with NASSCOM, right now, are trying to buy the 2010 elections and in spite of how corrupt Democrats are, you ain't seen nothing if the GOP gains power. These are the people behind them.
Notice that the Indian offshore outsourcing industry is $50 billion. That's how big they have gotten off of global labor arbitrage.
So, even though these Indian Body shops are operating in the United States, do they hire Americans? Answer, not on your life. From Infosys's SEC 20-F form, dated April 14 2010:
As of March 31, 2010, the majority of our technology professionals in the United States held either H-1B visas (approximately 8,900 persons, not including Infosys BPO employees or employees of our wholly owned subsidiaries), which allow the employee to remain in the United States for up to six years during the term of the work permit and work as long as he or she remains an employee of the sponsoring firm, or L-1 visas (approximately 1,800 persons, not including Infosys BPO employees or employees of our wholly owned subsidiaries), which allow the employee to stay in the United States only temporarily. Although there is no limit to new L-1 visas, there is a limit to the aggregate number of new H-1B visas that the U.S. Citizenship and Immigration Services, or CIS, may approve in any government fiscal year which is 65,000 annually. In November 2004, the United States Congress passed a measure that increased the number of available H-1B visas to 85,000 per year. The 20,000 additional visas are only available to skilled workers who possess a Master's or higher degree from institutions of higher education in the United States. Further, in response to the terrorist attacks in the United States, the CIS has increased its level of scrutiny in granting new visas. This may, in the future, also lead to limits on the number of L-1 visas granted. In addition, the granting of L-1 visas precludes companies from obtaining such visas for employees with specialized knowledge: (1) if such employees will be stationed primarily at the worksite of another company in the U.S. and the employee will not be controlled and supervised by his employer, or (2) if such offsite placement is essentially an arrangement to provide labor for hire rather than in connection with the employee's specialized knowledge. Immigration laws in the United States may also require us to meet certain levels of compensation, and to comply with other legal requirements, including labor certifications, as a condition to obtaining or maintaining work visas for our technology professionals working in the United States.
Infosys has 113,800 employees worldwide, and approximately 22,700 outside of India. In the United States their total employee roster is 12,000, reported by the press. Note how Infosys does not publish the employee breakdown per country. Regardless, this means that in the U.S., almost all Infosys workers are foreign guest workers, or about 1300, potentially are not on a guest worker Visa.
Within Infosys SEC filings are many explanations on how they squeeze labor costs, not just in the United States, but also in India itself. Beyond cheap labor, another reason corporations offshore outsource to India is it's judgment proof, a kind of a Cayman Islands for lawsuits.
The United States and India do not currently have a treaty providing for reciprocal recognition and enforcement of judgments (other than arbitration awards) in civil and commercial matters.
While Indian offshorers try to hide employment specifics, they do refer to legislation which would restrict offshore outsourcing. These bills they vehemently oppose to the point they list them on the SEC filings, are actually bills on immigration, specifically H-1B and L-1 guest worker Visas. Foreign guest workers, immigration and offshore outsourcing are considered duals of each other. If they cannot offshore outsource the job, corporations bring cheap labor in instead. From Wirpo's 20-F form:
A majority of our personnel in the United States hold H-1B visas or L-1 visas.
In 2007, Tata Consultancy had more 10,843 workers in the United States. Only 739 (9%) were Americans.
The bottom line here is these companies are not going to hire Americans. They are out to defeat any legislation which restricts offshore outsourcing or bringing in foreign cheap labor. They might hire a few token Americans for some nice photo ops and press releases, but that's it.
Their entire business model is labor arbitrage, literally spelled out in their own SEC filings and they have no intention of changing that business model, regardless of the spin and lies and media buys they make.