Dive Brief:
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Both houses of the California State Legislature passed legislation, AB-848, disallowing California State University and the University of California from displacing university employees by contracting work out to non-U.S. workers, according to state legislative records. The bill passed the California State Senate September 12 and the California State Assembly September 13.
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The bill was prompted by a layoff of 17% of IT workers at the University of California San Francisco campus in 2016 after the university signed a $50 million five-year contract with India-based IT firm HCL, reports Computerworld.
- In addition to 1.7 million U.S. jobs and $1.36 billion lost to outsourcing since 2000, the bill says contracting and subcontracting abroad creates jobs in other countries with state taxpayer dollars. "State taxpayer funds should be used to create jobs in the United States and in California," the bill reads.
Dive Insight:
The bill was passed overwhelmingly in both houses and is expected to receive the governor's signature. Proponents are quick to point out that it does not ban outsourcing outright, rather only in the case of displacing current state university workers.
The tech workforce composition is on the brink of major shifts given changes to the H-1B visa program and President Trump's "Hire American" order. The Departments of State, Homeland Security, Labor and Justice have until November to review the visa program and recommend changes.
Large companies are already reconfiguring hiring practices in response to political pressures. Infosys announced plans to hire 10,000 American workers, 2,000 of which will go to the company's new North Carolina tech hub.
Outsourcing tech jobs has generated a lot of controversy, but many experts and tech companies maintain it is beneficial for all parties involved. A recent study from the Center for Global Development and University of Michigan found average American and Indian workers are better off financially with the H-1B program in place. The study also reported a combined $17.3 billion income rise in 2010 between the countries and an overall IT output increase.
