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Offshore Contractors Target State Government Work
State governments increasingly are contracting with foreign outsourcing firms, sending millions of dollars in state taxpayer funds overseas. In many cases, states don't even realize the extent to which taxpayer-funded information technology work is being performed offshore.
Those are the findings of a new report by the Corporate Research Project of Good Jobs First, a Washington, D.C. based research group. The report, "Your Tax Dollars at Work...Offshore," was conducted for CWA Local 37083, the Washington Alliance of Technology Workers, and released during a telephone news conference on July 14.
WashTech President Marcus Courtney stressed that there is a real need to document how IT work for social service programs and other state functions is being sent offshore. "This issue is generating a lot of attention and controversy in the states, and as legislatures take up this issue, they need the hard facts on how offshore contractors are positioning themselves to target the work of state governments," he said.
The report found that 18 offshore outsourcing firms are aggressively seeking state government contract work in at least 30 states. The 18 firms have captured about $75 million in state contracts so far and are seeking more, in part by hiring former government officials and by making state electoral campaign contributions, the study said.
It also included a systematic national look at the use of offshore outsourcing for food stamp call center work, which was mandated by the federal government when it switched from paper food stamps to an electronic transfer program. At one point, call centers for 42 states were operating offshore, the report found. As a result of growing public awareness, one state, New Jersey, brought its call center back to the United States and four other states are planning to return that work, the report noted.
In some cases, state governments are not even aware that they are sending work offshore, the study found. In many cases, state governments awarded contracts to U.S. firms, believing that the work would be performed domestically, only to find that the work was subsequently subcontracted to an offshore vendor.
Those are the findings of a new report by the Corporate Research Project of Good Jobs First, a Washington, D.C. based research group. The report, "Your Tax Dollars at Work...Offshore," was conducted for CWA Local 37083, the Washington Alliance of Technology Workers, and released during a telephone news conference on July 14.
WashTech President Marcus Courtney stressed that there is a real need to document how IT work for social service programs and other state functions is being sent offshore. "This issue is generating a lot of attention and controversy in the states, and as legislatures take up this issue, they need the hard facts on how offshore contractors are positioning themselves to target the work of state governments," he said.
The report found that 18 offshore outsourcing firms are aggressively seeking state government contract work in at least 30 states. The 18 firms have captured about $75 million in state contracts so far and are seeking more, in part by hiring former government officials and by making state electoral campaign contributions, the study said.
It also included a systematic national look at the use of offshore outsourcing for food stamp call center work, which was mandated by the federal government when it switched from paper food stamps to an electronic transfer program. At one point, call centers for 42 states were operating offshore, the report found. As a result of growing public awareness, one state, New Jersey, brought its call center back to the United States and four other states are planning to return that work, the report noted.
In some cases, state governments are not even aware that they are sending work offshore, the study found. In many cases, state governments awarded contracts to U.S. firms, believing that the work would be performed domestically, only to find that the work was subsequently subcontracted to an offshore vendor.