Stimulus plan’s ‘Buy American’ clause influences technology outsourcing
The “Buy American” clause in the American Recovery and Reinvestment Act (ARRA) is influencing state and local government administrators’ information technology (IT) outsourcing decisions, according to a poll by the Clearwater, Fla.-based Brown-Wilson Group. Most ARRA funding for technology initiatives will go to American firms as a response to ARRA’s purchasing requirements and a “protectionist sentiment” among elected officials and taxpayers, according to Brown-Wilson’s survey.
Ninety percent of survey respondents agreed to four main characteristics that would define the types of companies they would use for outsourced IT services. The companies would have to be domiciled in the United States, employ U.S. citizens for at least half of their workforces, would provide ARRA-funded services using only citizen employees or no more than 15 percent H1-B visa workers, and possess the resources to conduct the services entirely on U.S. soil. “Constituent sentiment is demanding the use of American suppliers as technology unemployment exceeds 10 percent in some parts of the United States,” Brown-Wilson partner Douglas Brown said in a statement.
Despite high unemployment, public sector organizations are more likely to outsource IT services in the near future, Brown said. “State and local governments believe outsourcers can help them improve service, build capacity quicker than if the organizations attempted to do so in house, and to obtain needed expertise and staff,” he said.
More information on the “Buy American” trend in outsourcing is available in Brown-Wilson’s free publication, “2009 Black Book of Outsourcing.”