US outsourcing bill raises concerns

The Huffington Post says.

The legislation, pushed by Republican Tim Bishop (D-N.Y.) and the Communications Workers of America (CWA) union, would make companies that outsource their call centre work ineligible for guaranteed federal loans and grants for a period of five years. The bill, entitled "US Call Centre Worker and Consumer Protection Act", would also require those companies to report themselves in advance to the Labour Department, which would maintain a public list of the companies that outsource.

Trade and industry secretary Gregory L Domingo was alarmed by the anti-outsourcing sentiment in the Obama administration even as he vowed to mount a strong lobby in the US Congress against a proposed bill that seeks to ban outsourcing and offshoring activities of American companies of their non-core functions to other countries, including the Philippines, Manila Bulletin reports.

“We are very concerned about it and we will lobby in the US Congress primarily through our embassy led by Ambassador Jose Cuisia Jr and also through the Filipino communities in the US,” Domingo said.

About 70% of business process outsourcing (BPO) firms in the Philippines rely heavily on US clients, although demand for outsourcing jobs is growing in Europe and Australia, The Inquirer notes.

Since BPO firms, knowledge process outsourcing companies and similar entities contribute greatly to employment and foreign exchange earnings, US insourcing “could lead to a decline in both (jobs and dollar revenue),” Dr Cid L. Terosa, of the University of Asia and the Pacific, said via text message.