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Business leaders see election affecting offshoring

In Meta Group study, nearly half of managers surveyed predict offshore outsourcing will decline if Kerry elected.

In a study released Thursday, nearly half the business and tech professionals surveyed think the outcome of the presidential election will affect the level of offshore outsourcing. But an analyst at the firm behind the report said neither candidate will have much impact on the controversial trend.

In a Meta Group report, about 300 business and technology leaders and staff were asked whether they thought U.S. companies would use offshore outsourcing more or less if Republican George W. Bush wins or if Democrat John Kerry wins, or if the results of the election would have no impact. In the case of a Bush victory, 46.7 percent said, more companies will use offshore outsourcing; 10.7 percent said fewer companies will use it, and 42.6 percent said it will have no impact. If Kerry takes the day, 14.2 percent said, more companies will use offshore outsourcing; 47.8 percent said fewer companies will use it, and 38 percent said it will have no impact.

But Meta analyst Stan Lepeak said neither Bush nor Kerry will have much effect on offshore outsourcing, which refers to farming out tasks such as programming to another company that does the work from a lower-wage nation, such as India.

"Despite each party's position about the merits or ills incurred from offshore outsourcing, the fact is that offshore outsourcing is a manifestation of an ongoing and long-term economic evolution that will not be greatly impacted by either candidate," Lepeak said in a statement.

The exact extent of offshoring and its effect on the U.S. economy has been hard to pin down. But amid concern that high-wage jobs, and even American tech leadership, are threatened, the practice has been an issue in this year's campaign. President Bush has been quiet about shipping services work offshore, but his top economic adviser has argued it makes sense. Technology leaders, for their part, have warned that protectionist measures lead to lower economic growth and higher unemployment. To help U.S. workers find better, higher-paying jobs, the president has proposed doubling the number of people served by a job training program and increasing funding for community colleges.

Kerry has been more outspoken about the offshore shift. He plans to end tax breaks for companies that ship jobs overseas and wants federal contract work to be performed by American workers "where possible." In a recent position paper, Kerry called for reforming the controversial H-1B and L-1 visa programs, which have been accused of fueling the offshore trend. He also proposed expanding a program for helping workers hurt by trade.

In its report, Meta Group argued that attention should be put on job training. The researcher also recommended tax and job-creation incentives and enhanced unemployment benefits "to address the transition period required for reskilling efforts."