CommunityPam's House Blend

A couple of local items

* No one else is going to care about this item but me…FINALLY, a heinous traffic bottleneck in my area is going to be fixed.

Work should begin soon on the last phase of the four-lane Martin Luther King Jr. Parkway that runs from southwestern Durham into the booming area around Research Triangle Park.

The parkway, intended to provide a fast-moving thoroughfare and relieve traffic on Interstate 40, drops to two lanes between Old Chapel Hill and Hope Valley roads, where it is currently called Archdale Drive. With a $2.9 million contract approved by the City Council recently, that final three-quarter-mile phase should be widened within about 18 months.

* Outsourcing the local economy — A great piece by Anne Krishnan in the Durham Herald-Sun reports on the “offshoring of white-collar RTP jobs. Welcome to the Bush economy. Our area has had explosive job growth in the last couple of decades, and now many of those jobs are being transferred for the cheap labor. And remember, NC is a “right to work” state.

Nine time zones away from Cisco Systems’ campus in Research Triangle Park, Sekhar Reddy leads a 40-person team that’s creating next-generation mobile phone technology.

Reddy, who worked at IBM in the Triangle for a year and then at Cisco’s office in San Jose, Calif., for eight years, returned to his native India this spring as a manager in Cisco’s mobile wireless group.

…Over the past 30 years, companies have sent millions of blue-collar manufacturing jobs overseas. Now the debate rages as white-collar, knowledge-based positions such as paralegals, accountants, software programmers and Web designers — jobs previously shielded from global competition — head to countries like India, China and the Philippines.

The issue isn’t so much how many jobs are currently being sent overseas in the practice known as offshoring; it’s what kinds of jobs are going.

“Apparel workers in North Carolina have been in competition with workers from around the world for 20 years,” said Josh Bivins, an economist with the Economic Policy Institute, a nonpartisan think tank based in Washington, D.C. “We may now see that competition entering new sectors of the American economy.”

…Large firms such as IBM, Ericsson, Nortel Networks, SAS and Cisco have been offshoring for years. Now smaller Triangle firms such as Cary’s Ultimus, Apex’s Translogic Systems and Morrisville’s LVL7 are operating offices in India or Pakistan. Other high-tech companies, like Durham’s StrikeIron and RedPelican, are doing work in Vietnam and Russia, respectively.

Still, experts say the number of white-collar jobs currently moving overseas is relatively low.

Goldman Sachs estimates that the U.S. economy is losing 5,000 to 10,000 nonmanufacturing jobs each month to offshoring and has lost 300,000 to 400,000 over the past three years. Forrester Research predicts that U.S. companies will send 3.4 million white-collar jobs overseas by 2015.

Local companies like the Research Triangle Institute, SAS and IBM all employ people in the Triangle who work for clients around the world, he said. In September alone, American companies provided $4 billion more services to foreign companies than came into the United States, the U.S. Department of Commerce reported last week.

“Americans are good at this,” Grennes said. “I think that gets missed by all of the politicians and the popular discussion.”

…The human story associated with offshoring is complex, said Arie Lewin, director of Duke University’s Center for International Business Research, or CIBER. CIBER is conducting a multi-year study that tracks 400 companies’ offshoring decisions and results. It also will hold a national conference on trade policy in December, with much of the discussion about white-collar offshoring.

U.S. institutions aren’t equipped to help people with the adjustment, said Lewin, who said he doesn’t know how severe the exodus of white-collar jobs could become.

“We have a better institutional structure to help blue-collar workers when they lose their work,” he said. “But if you’re a white-collar worker and you’ve worked your way up and think you have a secure, middle-income kind of office work and you get offshored, it’s psychologically difficult to take.”

Bivins is concerned that continued offshoring will create polarization in the U.S. economy, with corporations and businesses becoming more profitable while a large group of workers’ wages and employment suffer.

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Pam Spaulding

Pam Spaulding