America's IT industry is looking at the foreign competition - and it's worried. A group of eight leading CEOs, all members of the Computer Systems Policy Project, is calling on the US government to help the country stay on top of the technology tree.
The CSSP wants better R&D tax credits, more federal investment in science, and stronger government support for the roll-out of broadband. It is seeking a meeting with the Bush administration to set out its agenda, which will cost billions of dollars a year if implement.
At the same time, the advocacy group is urging the government to ignore calls to erect trade barriers, and to resist moves to limit the ability of computer companies to move jobs overseas. Protectionism would make America less competitive and would provoke retaliation, it argues in this document (2.5MB PD).
In a press conference launching the CSSP campaign yesterday, Carly Fiorina, HP's CEO, said: "There is no job that is America's God-given right any more. We have to compete for jobs as a nation. Our competitiveness as a nation is not inevitable. It will not just happen."
Speaking at the same conference, Intel CEO Craig Barrett said the annual US bill for agricultural subsidies - $30bn - represented an investment "in the industries of the 19th century". By contrast, the annual federal investment in science is just $5bn, he noted.
The CSSP characterises the debate between the globalisers and what it (and we) term protectionists as "Do we compete or do we retreat". America, it says, must never compete in the battle to see who can pay their workers least". But it will take thoughtful leadership to ensure success.
A big political head of steam appears to be building in the States over moving tech jobs overseas. According to the San Jose Mercury, several bills have been introduced in Congress by members off both parties seeking to stem the move of hi-tech jobs offshore. Gartner, the tech analyst firm, last year forecast that one in 10 tech industry jobs would move overseas in 2004, while one in 20 tech jobs in end-user enterprises would shift offshore in the same time. Unlike most overseas transfers, these are middle class jobs which are being "lost".
To date, America's consumers are the biggest beneficiaries of globalisation. A lean and competitive US hi-tech industry will ensure the preservation of many high value jobs that would otherwise be lost, as overseas rivals notched up more market share. A competitive tech industry also means that customers pay less. That's the theory anyway.
Millions of high value jobs will be lost in the US. Sure there will be replacements, but of what calibre? It is possible the value of the skills of survivors such as software development and sysadmin nous will be permanently depressed, when compared with the heyday of the late 90s and 2000. ®