Oracle Outsourcing software jobs to India

Date: Wednesday, February 26, 2003 10:44 AM

H-1B and JOB DESTRUCTION NEWSLETTER

www.ZaZona.com

Ash Lilani, South Bay region manager of Silicon Valley Bank, says most
jobs being outsourced to India are not wanted by American's "highly
skilled work force". Lilani's statement seems to contradict the claims
of companies that claim that the reason they import H-1Bs is because of
a lack of highly skilled workers in America. The shills should work a
little harder at getting their stories straight!

As far as Silicon Valley is concerned, Lilani sees Oracle's offshore
strategy as a positive for the valley's economy. He claims that all of
the money that is leaving Silicon Valley will some day come back. He
didn't say how the money will come back so let's hope it's special
delievery by a magic carpet.

http://www.svbizink.com/headlines/article.asp?aid=4270&iid=288

Oracle to farm out software jobs to India

Published: Friday, February 21, 2003

BY STEVE TANNER

Despite the large number of unemployed technology workers in Silicon
Valley, Oracle Corp., the world's largest enterprise software company,
plans to hire about 2,000 lower-paid software developers in India
during the next couple of years.

Oracle's growing employee base in India and China is part of an
accelerating trend of creating technology jobs outside the United
States to save money.

Forrester Research Inc. estimates $136 billion in U.S. wages -- or
about 3.3 million jobs in software, product development, back-office
accounting and call center support -- will move offshore to India,
Malaysia, China, Russia and the Philippines in the next 15 years.

The Redwood City company eliminated about 1,000 jobs in North America
during the past two years but declined to say how many were in the Bay
Area. Oracle employed 10,649 sales, services and marketing employees in
the United States and 17,572 employees abroad as of last May, according
to its 10-K filing with the Securities Exchange Commission. Oracle's
10-K states while "research and development personnel increased 12
percent, expenditures decreased due to the hiring of personnel in India
and China where personnel costs are significantly lower than in the
United States." Oracle employs 2,460 people at offices in Hyderabad and
Bangalore, India. The additional 2,000 proposed jobs in India comes as
Oracle makes cuts to its bottom line, as revenues for the fourth
quarter of 2002 fell 7 percent compared to the previous quarter.

Oracle's human resources and press relations departments declined to
provide salary comparisons between its employees in the Bay Area and
India. Oracle's Senior Vice President of Human Resources Joyce
Westerdahl was traveling and unavailable for comment.

However, Bob Plaschke, chief financial officer of Sonim Technologies
Inc. in San Mateo, which employs 55 people in India and 25 in the Bay
Area, says Indian technology workers generally earn half the salary of
those in comparable jobs in the U.S. About five years ago, technology
employee salaries in India were 80 percent less than comparable U.S.
jobs, he says.

"It's very clear that what Oracle is trying to do is cause unfair
competition between its U.S. work force and its Indian work force on
the basis of payroll and benefits," says Marcus Courtney, president of
WashTech, a Seattle-based subsidiary of the Communication Workers of
America.

He believes the affects of creating or moving jobs offshore -- a
practice that Intel Corp., Sun Microsystems Inc. Hewlett-Packard Co.
and 280 of the Fortune 500 companies have engaged in for years -- will
drive down wages and hurt benefits packages for U.S. workers.

Despite Oracle's 10-K statement, Oracle spokeswoman Jennifer Glass
insists hiring 2,000 software developers in India is not shifting jobs
out of the United States, nor a cost-cutting strategy, although she
acknowledges that there are cost benefits to moving jobs offshore.

Nimish Mehta, CEO of Mountain View-based Stratify Inc. and former vice
president of Oracle's mid-range products business, believes the move is
primarily to cut costs.

"As companies here come under cost pressures, I see more of this
happening," Mehta says.

Glass says India's university system fosters a technology-savvy work
force and that having English-speaking employees outside the United
States is a strategic advantage for a global company.

Stratify's Mehta says many technology professionals, who were in
Silicon Valley on H1-B temporary work visas have moved back to India,
which is enjoying a hot technology job market.

Neither the U.S. Department of Commerce nor the Immigration and
Naturalization Service track the number of H1-B workers that have moved
back to their nation of origin.

Ash Lilani, South Bay region manager of Silicon Valley Bank, who
reports to the bank's director of U.S.-Indus technology and venture
capital networks, says most jobs being outsourced to India are not ones
typically sought after in the U.S. by a highly skilled work force. He
identifies most of the outsourced jobs as call center and back-office
accounting positions.

Lilani sees more overseas outsourcing among his client companies, but
believes it's a natural result of globalism.

"Businesses are beginning to think of themselves as global," Lilani
says. "Companies such as Oracle work with countries all over the world,
so they're thinking it only makes sense to find talented,
English-speaking workers. I think in tough economic times you have to
make some tough economic decisions."

As far as the valley is concerned, he sees Oracle's offshore strategy
as a positive for the valley's economy.

"It's important to take a long-term approach," Lilani says. "Money
saved by offshoring will be reinvested here in the valley."

WashTech's Courtney couldn't disagree more.

"Where is the economy if Oracle is growing its business in India and
not in Silicon Valley where there are tens of thousands of talented
tech workers?" he asks.

Steve Tanner is a Biz Ink reporter.
You can reach him at stanner@svbizink.com.

Help to Keep ZaZona.com Online

Donate to the Cause at
http://www.zazona.com/Donations.htm
To Subscribe or Unsubcribe send an email to

Back to archives