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How to save the IT industry in 4 (not so easy) steps

Stephanie Overby | Feb. 14, 2012
If government leaders really want to save U.S. IT jobs, here's what they should do.

Become the (Data) Host With the Most

If you build it, they could come. "If the federal government wants to grow [IT] jobs, they should provide incentives for building data center capacity," said Mark Ruckman of outsourcing consultancy Sanda Partners. "Make the U.S. the place where international companies want to host their data."

That kind of initiative could boost not only the domestic IT services industry, but the hardware and construction sectors as well. But only if the United States doesn't scare off overseas outsourcing customers with data privacy concerns. Government leaders should consider "limiting the ability of the U.S. government to use the Patriot Act and other tools to access corporate data as desired," Ruckman added. "Many [foreign] companies that would bring IT services and data to the U.S. prefer to send IT services and data to Canada or Europe to [avoid] the long arms of the FBI, Justice Department, CIA and Department of Homeland Security."

Devise a Long-Term Plan for Resurgence

Some observers also argue that U.S. policymakers have been short-sighted in their planning.

"The U.S. government is not overly concerned with a long term-view of anything," said Adam Strichman, founder of Sanda Partners. "The farthest their eyes can see is four years, which is not enough time."

Not so the Chinese, who have been barreling through consecutive 10-year plans for global IT services ascendancy. "They have decided that they will be the de facto choice for IT outsourcing, and they are now restructuring aspects of their society so that in 15 years, they can't be beat," said Strichman. Those plans encompass everything from English language programs and IT literacy education to physical infrastructure designed to cater specifically to the IT services industry.

"They have an integrated economic plan to take the IT flag from India and plant it squarely in China," Strichman said. Creating such a comprehensive plan along with economic incentives specifically designed to increase IT isn't easy, but the United States has a head start.

"We have the infrastructure, which is the hard part," Strichman said. "But we don't have the incentive plan which is available in other countries." Those incentives could include payroll tax benefits for companies hiring U.S. IT professionals, or tax incentives for individuals working for those companies.

Invest in IT Education Reform

The federal government must take a more active role in U.S.-based IT education and training initiatives, said Marc Tanowitz, principal for outsourcing consultancy Pace Harmon. What's needed -- from pre-k all the way through post-secondary school -- are rigorous programs to teach practical and effective IT skills for the next century, he says.

Rather than a focus on routine IT tasks that will never return to the United States, KPMG research director Stan LePeak would like to see a greater emphasis on core tech skills, emerging technologies, and creative IT problem solving.


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