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Displaced IT workers apply for federal help

Notices on Connecticut Department of Labor site document effort

May 28, 2010 12:51 AM ET

Computerworld - A state that was a leader in the legislative battle over outsourcing, Connecticut, is now reporting the impact of the offshore shift, although indirectly.

The Connecticut State Department of Labor's Web site revealed the information via trade act notices, which let laid off workers know whether they are eligible to apply for help under the Trade Adjustment Assistance (TAA) program.

The TAA program was designed for workers who have lost their job as result of foreign trade. It provides tax credits for health care, money for education and relocation, and a wage benefit differential for some workers who have taken a pay cut.

This month, Connecticut said 35 workers in The Hartford Financial Services Group's IT/Claims Division involved in IT production, maintenance and testing were eligible to apply for federal trade assistances, and 114 employees in its claims department involved in office processing and clerical support were eligible as well.

A Hartford representative was not immediately available for comment.

Approximately 100 workers of IBM's Global Business Services in Southbury were also eligible, according to the notice, filed early this month. IBM may have cut as many as 10,000 workers last year, according to the Alliance@IBM/CWA Local 1701; the company never comments on its job actions, other than to say that it's a result of a remixing of is skills and structure.

Lawmakers in Connecticut were among the first to try to put brakes on offshore outsourcing. In 2003 alone, state lawmakers introduced three bills that would reform the H-1B and L-1B program, with one even proposing reducing the H-1B cap to 35,000. It's now at 85,000.

That legislation was the result of lobbying efforts by Connecticut IT workers, many working in financial services, who said they were being displaced by workers from offshore outsourcing firms. Those early legislative efforts were unsuccessful.

The legislative focus in Congress now on a comprehensive immigration reform measure that's expected to include some of the provisions sought by some of Senate's two leading H-1B program critics, Charles Grassley (R-Iowa) and U.S. Sen. Richard Durbin (D-Ill). Grassley and Durbin are trying to limit the use of temporary visas in offshore outsourcing.

In a 2007 report prepared for Congress, the number of workers in non manufacturing jobs that were considered "highly offshorable" was slightly more than 9 million, and "offshorable" at nearly 12 million, according to the Congressonal Research Service.

The CRS used the definitions of what is "offshorable" from a paper by Princeton economist Alan Blinder who estimated, that between 22% and 29% of all U.S. jobs "will be potentially offshorable within a decade or two."

He made no estimate on how many jobs might actually be sent offshore.

Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at Twitter @DCgov or subscribe to Patrick's RSS feed Thibodeau RSS. His e-mail address is pthibodeau@computerworld.com.

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