U.S. Service Industry Jobs Moving Offshore

U.S. Service Industry Jobs Moving Offshore
11/29/2005

A number of studies have indicated that millions of good paying American information technology jobs are now on the line and could be lost over the coming years. According to Forrester Research, a major consultant on this issue, ``Over the next 15 years, 3.3 million U.S. service industry jobs, $136 billion in wages, will move offshore." A recent study at the University of California at Berkeley Business School indicates the trend could leave as many as 14 million service jobs in the United States vulnerable. The study also indicates that the jobs remaining in the U.S. could be subject to pressure for lower wages. At a time when we have already lost millions of blue collar jobs because of our disastrous trade policies, the outsourcing of white collar jobs is an issue that we must focus on and we must reverse. Recently, Capital City Press announced that it will be laying off about 35 workers in the "Publication Services" and moving these jobs to India. My office is working hard with both the union and the company to make certain that these workers receive benefits from the federal Trade Adjustment Assistance program - a program run by the Department of Labor that provides, among other things, extended unemployment benefits, job training, health insurance support, relocation and job placement services.

Unfortunately, it its initial ruling, the Department of Labor rejected the application. We are working to have that decision reconsidered.

In October, the Labor Department denied these workers TAA benefits because, they said, their jobs are "service jobs" and the TAA law only applies to "manufacturing jobs." The Labor Department said that these workers - who play an integral role in the publishing process by doing the design, graphics and layout of books and journals so that they are ready to go to the printing press - can't get TAA benefits because they don't produce an "article" under their antiquated and overly restrictive interpretation of the TAA law, since their work is now computerized.

· What difference should it make if one week you're actually involved physically in the process as a typesetter, but the next week you accomplish the exact same purpose for the exact same end product (a book or journal you can hold in your hand), but instead your work is now done on a computer? One day you're a "manufacturing worker" but the next day you're a "service worker"? Common sense tells us that this is ridiculous.

· The negative decision issued by the Labor is the result of an overly narrow and antiquated interpretation of "production" as written in the Trade Act and it must be reconsidered. We are going to fight it tooth and nail until these workers are certified for the TAA benefits they deserve.

· My office will strongly support the request for reconsideration of this awful decision and we will do everything possible to convince the Department of Labor that they made the wrong decision.

· The fact that their work product, if done in India in the past, would have been shipped back to the U.S. on a boat, but can now be sent from there back to the U.S. over that internet does not make a whit of meaningful difference in the role they play in the book-manufacturing process or in the fact that they're losing their jobs due to our failed trade policy. They should be covered by the TAA law as written, period.

…but TAA Should Apply to Service Workers, Too

· The fact that the Labor Department has outright misinterpreted the TAA law in this case by concluding that these Capital City Press workers are "service workers" instead of "manufacturing workers" isn't all that is wrong with the picture.

· When a factory relocates to another country, those workers are eligible for TAA. But, under the law as written, when a call center, software developer or engineering firm moves to another country, their workers are not eligible for TAA.

· Why shouldn't the TAA law apply to service workers? Our economy - as a direct result of the failed, unfettered free trade policies we have been pursuing for years - is becoming more and more of a service economy than ever in our history.

· Why shouldn't service workers who are now forced to compete with computer programmers and customer service representatives and a whole host of other workers in Mexico and India and China be covered by the TAA law? Their jobs are no less important to them or to our economy and their jobs losses are no less due to our trade policies.

· Why should we only give TAA benefits to workers who make physical objects? That antiquated approach means that the 80 percent or more of American workers in the service sector cannot access TAA benefits.

· Today, the service sector accounts for over 80 percent of total U.S. employment, and cross-border services account for over 20 percent of the total value of U.S. trade.

· Many of these service workers have seen their jobs move overseas, including jobs in call centers, software development, technical support, accounting, and telemedicine services workers.

· That is why I am cosponsoring of HR 4156, the Trade Adjustment Assistance Improvement Act, just introduced in October, which would strengthen and expand TAA to help those affected by new economic realities and take the common-sense step of including service sector workers in the current program. It would also dramatically increase the funding available for job training programs and enhances health care subsidies for displaced workers.

http://thomas.loc.gov