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May 27, 2003

Bank of America tech worker's suicide linked to offshore outsourcing

Naturally, the "3-m plus-US jobs-to-be-lost" Forrester Research study figures prominently in the reports about the suicide.

Here are some extracts from the article headlined "Job losses sap morale of workers" in Contra Costa Times (May. 19, 2003).

One month ago, Kevin Flanagan took his life in the parking lot of Bank of America's Concord Technology Center, on the afternoon after he was told he had lost his job.

It was "the straw that broke the camel's back," his father said, even though the 41-year-old software programmer suspected it was coming. He knew that his employer, Bank of America Corp., like other giant corporations weathering the economic storm, was cutting high-tech jobs. He knew that Bank of America was sending jobs overseas. He had seen his friends and coworkers leave until only he and one other person remained on the last project Flanagan worked on.....

(Here come the Forrester numbers..)

...his death underscores the anxiety that has swelled among technology workers at Bank of America and elsewhere as more businesses shift high-tech jobs and responsibilities to contractors offshore even as they cut jobs in the United States.

A report by Forrester Research projects that, led by the information-technology industry, 3.3 million service jobs and $136 billion in wages will move from the United States to such countries as India and Russia over the next decade or so.

Another survey by A.T. Kearney said that U.S. financial-services companies are planning to send overseas 8 percent of their workforces, thus saving them more than $30 billion.

(The article also quotes Bank of America spokeswoman Lisa Gagnon. She has tried, quite gamely, to de-link job-losses from offshore outsourcing)

In the fall of 2002, it (Bank of America) signed agreements with Infosys, whose U.S. headquarters are in Fremont, and Tata Consulting Services, two of the largest players in information-technology consulting and services in India.

Overall, this deal should affect no more than 5 percent of the bank's 21,000 employees, or about 1,100 jobs, in its technology and operations division, Gagnon said. So far, it has been less than that, she added.

But Gagnon declined to say how many U.S. and Concord workers have been affected so far.

"It's important to note that just because we decide there is a good business reason to send a project (overseas) does not mean it will necessarily result in job displacement," she said.

(Gagnon's comments are supported by quotes from a Gartner analyst as well)

Growing overseas does not necessarily translate into a loss in the United States, said Debashish Sinha, principal analyst for information technology services at Gartner, a research group.

"Very rarely is there a direct staff substitution," he said. "Very rarely will a U.S. enterprise lay off their internal IT folk to hire an external offshore service provider."

(But, the reporter doesn't seem to buying these defences. The report's focus is firmly on painting a poignant tale of how the dead programmer's father is dealing with the sadness of his son's extreme step--and weaving together a story that subtly points the finger to companies that "ship high-paying tech jobs" overseas.)

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