High Skill Information Technology Employment: Offshore Outsourcing and Risk

1. Conclusion This paper shows that the key aspects of contemporary global risk, as Beck articulates them are prominent in the case of IT work. The offshoring of highly skilled labour poses an innate threat to some of the ideological tenets of American society, namely, the value of achievement and educational capital. This represents a contradiction that was not evident in the logic and political rhetoric surrounding the debate on the offshoring of manufacturing jobs during the forging of NAFTA. High Skill Information Technology Employment: Offshore Outsourcing and Risk Dr. Julie McMullin and Dr. Tammy Duerden Comeau University of Western Ontario Research Abstract Research Question 3) Tendency to Minimize Impact In this paper, we consider Urlich Beck’s theory of the risk society in relation to highly skilled Information Technology (IT) employment. Beck argues that contemporary risks are less predictable and more diffuse now than they were in the past. As a result, workers who have been comparatively sheltered from wide-spread job displacement, may be increasingly at risk. In some ways, the offshoring of highly skilled IT jobs mimics the wide-spread loss of manufacturing jobs that occurred over the past two decades. Yet, the magnitude of highly skilled job loss has been smaller, while the political reaction has been arguably more robust. This supports Beck’s prediction that with the extension of risk, key leaders will be persuaded to reevaluate the merits of globalization. Indeed, when comparing the offshoring of manufacturing work to the offshoring of high skill IT work, the traditional justifications for exporting work are no longer convincing and consequently “delegitimate” the ideological justifications for global capitalism. Using highly skilled IT employment as a specific case in which offshore outsourcing is increasing, this paper draws on Beck’s work to assess whether there has been a fundamental shift in the nature of risk in the second modernity. • Beck (2004) argues that in contemporary risks there is a tendency for powerful groups to minimize their impact. • Most Republican politicians and economists tend to minimize the risk of offshoring highly skilled IT jobs in much the same way that they minimized the risk of offshoring manufacturing jobs. • President Bush’s chief economic advisor Gregory Mankiw called the phenomenon of offshoring “just a new way of doing international trade… [noting that] more things are tradable than were tradable in the past and that’s a good thing” (Crutsinger, 2004). Beck’s Global Risks • In Beck’s conceptualization (2004: 140), global risks are “risks • that are systemic, unpredictable, uncertain and infinite.” Beck • argues (2004, 1999) that the distinctive aspects of • contemporary global risks are: • their unpredictability and democratization • 2. their unmeasurable character • 3. the tendency for powerful groups to minimize their impact • 4. the creation of ‘new Cassandra’s’ who question the underlying tenets of ‘progress’ and globalization. 4) The Creation of ‘New Cassandra’s’ • Beck argues that society’s “new Cassandra’s” are those who “people would least expect …mainstream politicians start to say that certain kinds of ‘progress’ that we’ve previously taken for granted actually can’t be continued without leading to disaster” (Beck, 2004: 151). • Democratic critics are publicly questioning the processes of globalization in a way that did not happen when manufacturing jobs began to be offshored (Schumer and Roberts, 2004). John Kerry, although supportive of NAFTA, vowed in his 2004 presidential election campaign to “seek out and punish any ‘Benedict Arnold’ company or CEO that takes American jobs overseas” (The Times, 2004). • Several conservative economic commentators have sided with the Democrats, suggesting that this issue transcends party lines. After supporting NAFTA, Republican economists Charles Schumer and Paul Craig Roberts publicly questioned the fundamental tenets ofclassical economic theory underlying free trade. 1) Unpredictability and Democratization • According to Beck, risks are increasingly unpredictable and their democratization means that groups who were isolated from risk in the first modernity are now increasingly exposed to it. • The extension of offshoring to highly skilled IT work was not a predictable consequence of the offshoring of manufacturing work. In the 1990s, job losses in the manufacturing sector were justified with the political rhetoric that the well-paying, high skill jobs of the 21st century would stay in the United States. • Silicon Valley, an area that houses one of the best educated workforces in the United States, is subject to the largest offshoring threat (Shinal, 2004). • The national unemployment rate in the U.S. sits at 5.6% while the unemployment rate for computer programmers is 9.5% (EPI, 2004). • Unemployment rates for US computer scientists and systems analysts have been at an all time high in 2004 at 6.7% (Thibodeau, 2004). 2) Unmeasurable Risk and High Skill IT • Beck argues that risks have become very difficult to quantify (2004, 1992). • Data on offshoring are piecemeal, partial and often anecdotal, as critics note that “the government doesn’t keep count of jobs leaving the country, and the statistics available on outsourcing are sketchy” (Hilsenrath, 2004: A3). • In 2002, highly skilled computer occupations made up seven of the ten fastest growing occupations in the United States. In the most recent projections, only one computer occupation remains in the top ten (AFL-CIO, 2004). www.wane.ca Funded by the Social Sciences and Humanities Research Council’s INE Collaborative Research Initiative Grants (2002)