Anti-outsourcing bill fails in Congress
- 19 July, 2012 20:53
- Comments
WASHINGTON -- This year's election focus on outsourcing is producing legislation intended to encourage firms to repatriate jobs back to the U.S. But the latest effort, and possibly the best shot from the Democrats before November -- a bill called "Bring the Jobs Home Act" -- failed Thursday on a 56-42 vote. It needed 60 votes to move forward.
Introduced by Sens. Debbie Stabenow (D-Mich.), Dick Durbin (D-Ill.) and Richard Blumenthal (D-Conn.), it offered a tax credit to companies that return jobs to the U.S. President Barack Obama backed the measure. Its provisions included a tax credit equal to 20% of the cost associated with relocation.
These tax benefit efforts have had some support from IT firms that are boosting their onshore presence. Among them is GalaxE.Solutions, a New Jersey-based IT services firm, which has launched an "Outsource to Detroit" program. Most of the firm's workers are in India and China, but its U.S. workforce is expanding.
Despite some IT sector support, the impact of the tax benefits on the broader offshore trend is considered minimal.
"The primary reason is that the bill only deals with the cost of moving jobs overseas, or moving them back onshore," said Frank Scavo, president of Computer Economics. "It doesn't deal with the ongoing cost of the job itself."
With IT outsourcing, the cost of moving the job is minimal, said Scavo. "The real money is in the ongoing costs -- what you pay that resource on a month-to-month basis."
The tax credit may help a company that is already considering an onshore move, but regarding the legislation's overall impact, "I don't think it will move the needle in a big way," said Scavo.
Patrick Thibodeau covers cloud computing and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov or subscribe to Patrick's RSS feed. His e-mail address is pthibodeau@computerworld.com.
See more by Patrick Thibodeau on Computerworld.com.
Read more about gov't legislation/regulation in Computerworld's Gov't Legislation/Regulation Topic Center.
Recommended
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.
- Bookmark this page
- Share this article
- Got more on this story? Email CIO
- Follow CIO on twitter
-
Samsung Galaxy S4 vs. HTC One: 5 Reasons to Choose the GS4
-
Samsung Galaxy S4 vs. HTC One: 5 Reasons to Choose the GS4
-
Solving the skills conundrum – part 1
-
Samsung Galaxy S4 vs. HTC One: 5 Reasons to Choose the GS4
-
High school students still see ICT as ‘sitting at a computer all day’: survey
-
Six Reasons to Empower Your SharePoint Citizen Developers
More and more business applications are being created by “citizen developers” - end users who are not IT developers but who create solutions for themselves and their groups. This white paper explores six reasons to embrace citizen development in an intelligent way that minimises risks and maximises the return on your SharePoint investment. Read now. -
Top 10 Mistakes in Data Centre Operations: Operating Efficient and Effective Data Centres
How can you avoid making major mistakes when operating and maintaining your data centre(s)? The key lies in the methodology behind your operations and maintenance program. This whitepaper explores the top ten mistakes in data centre operations. Read now. -
CSO Spotlight: Security-as-a-Service Gaining Popularity
Organizations that are looking for security features including identity management, encryption and access control — and at the same time want to take advantage of the cost and flexibility benefits of the cloud —might check into security-as-a-service offerings available now from several vendors. Download now to find out more.
Get exclusive access to Invitation only events CIO, reports & analysis. 
