"The number-one issue is that trade raises income but it also redistributes it. The benefits from outsourcing are likely to be squeezed even further up the food chain, and it's hard to see how they would trickle down that much. The largest consumers of these goods are other businesses."

OVERSTATING THE CASE

"Companies might actually be overstating how much outsourcing they are doing. A large part of the anecdotal evidence comes from trade publications, where you have surveys answered by chief information officers. And of course they want to look like they are trying to be more profitable. It's also a pretty useful club for managers to use to beat down salaries, and an effective lobbying tool for companies that are seeking to keep quotas for H-1B visas high."

"There are two things about outsourcing that are new: China and India, home to several hundred million workers, are entering the world economy. For us overall that's a very good thing. It's a massive free lunch, but it also leads to significant destruction."

JOBS AND CIVIL LIBERTIES

"The U.S. is the biggest winner in this whole process. We enjoy a permanent increase in living standards, and we will take the cheap productions created overseas and use them as inputs. In India and China, not only are the workers there now being exposed to general ideas about democracy, but also more particular things like civil liberties. Mid-tier countries like Mexico and some nations in Europe may have the most to lose."

LOOKING ELSEWHERE

"Taxes and regulation in the U.S. are not getting better, and that encourages people to look to other regions."

"It's important to note that the vast majority of jobs in the U.S. are in service industries, a very large portion of which require direct customer interface, including many portions of business processes, retailing, catering and personal care. This work by its very nature cannot be moved abroad."

RE-EMPLOYING WORKERS

"Over the past 10 years, the U.S. economy has created a total of 36 million new private-sector jobs, or an average of 3.5 million new jobs per year. At this rate of job creation, the vast majority of displaced workers are re-employed within 6 months. Even within trade-related manufacturing job losses, where job creation has not matched the growth in the overall economy, redeployment is strong."

NEW TECHNOLOGIES YIELD JOBS

"The Bureau of Labor Statistics predicts the creation of 22 million new jobs in the economy from 2000-2010 mostly in business services, health care, social services, transportation and communications. In addition to this, with new technologies and innovations, many other occupations that we cannot even fathom today are likely to emerge, just as they have done over the past several decades. ... The 2 million jobs anticipated in nanotechnology alone will offset the offshoring, as will many other industries, such as health care and the medical-device field where our aging population is demanding more and more services."

"You would think that more companies would look to outsource during the recession, but it's only been with the rebound that our business has picked up. You can always chop one out of three heads, but outsourcing can represent an entirely different way for companies to do business."

GLOBAL TRANSITION

"China is making a large play for outsourced business processes, and so is India. And as the demand increases even smaller countries like [some in] the Caribbean and Mauritius are learning from India and China about how to attract clients. But we don't just work with U.S. companies. We work with British firms looking to Ireland, with Japanese firms looking to China. It's a global business. Everyone is looking at everything that isn't core to their business that can be done better by someone else."

LOW-COST MAINTENANCE

"There are some functions that are just more effectively done elsewhere. Maintaining legacy systems, for example. Companies have a lot of technology lying around that's just obsolete, and the cost to maintain them [in-house] is unrealistic. No one can afford to do systems documentation in the U.S., for example, but elsewhere, the costs are much lower."

"Any job that involves face-to-face time with clients is more immune [to outsourcing]. But even the people who maintain hardware are discovering that they cost more than the hardware does to replace. There aren't any real jobs that are safe, except for the CEOs and board members. Any job where you sit at a desk is vulnerable."

LARGE COMPANIES AND SMALL

"The outsourcing trend in tech really started with Ireland in the '90s. Now it's India and China mostly. But jobs are moving to the Philippines, Malaysia, Indonesia. Even Russia is a big rival now. It started with big firms but it's moving down the ladder. Smaller and smaller firms are doing it with the help of outsourcing experts and industry groups."

RETRAINING FOR WHAT?

"Everyone talks about these positions we should be retraining for. What positions? Where are they? There's nothing that can't go abroad. ...The idea of a skill shortage is a myth. If you look at the companies themselves and talk to the associations out there, there is no [IT] skill shortage. The problem is that American companies want skilled workers but they want it for free."

"It's important to set off sectors of the economy from occupations. Very few people look at jobs lost per occupation, but if I'm going to see outsourcing it should show up in the occupations data. And there's a number of occupations where the threat and actuality of outsourcing are not borne out in the data. You see a recovery in computer and math jobs, and a revival in engineering."

GLOBALIZATION'S EFFECTS

"Research suggests that globalization made computer hardware 10% to 30% cheaper. Cheaper prices mean more investment, and we get the benefits from that. We can use the hardware model as a model for information technology. Which sectors didn't use IT in the past; which sectors are ripe for increased IT use."

INCENTIVES TO TRAIN WORKERS

"The costs of adjustment aren't irrelevant. How do we help people find new jobs? We need to ensure that there's portable health coverage, wage-adjustment assistance and a human capital investment tax credits to give firms the incentive to train."

"Most of the companies heavily outsourcing work overseas are global companies selling in global markets. Sourcing labor in these markets is just a continuation of their global strategies."

NO INDUSTRY IS SAFE

"No industries are safe from outsourcing, except for government employees. Any knowledge worker job that can be done in a disconnected mode can be done [elsewhere]. ... Radiologists are being outsourced because there's a shortage here. Anything that has a degree of repetition and standardization is a candidate. Things that have a high degree of creativity and uniqueness aren't easily outsourced, such as a cancer specialist."

RETRAINING AND TRANSITION

"Companies that are outsourcing offshore are being very quiet about their activities. Internally, they are retaining and retraining workers. A typical transition takes six to nine months and workers are asked to remain in their jobs during the transition …. That period gives people time to find new jobs within a company and to acquire new skills that will make finding a new job easier. Companies typically invest a percentage of the savings achieved by offshore outsourcing on new projects, which creates opportunities for the displaced workers."

"Over the past three years, the U.S. has lost 2.6 million manufacturing jobs. The increase in productivity can account for some loss of jobs, but the vast majority of [the losses] is due to offshoring and outsourcing."

OUTSOURCING THE ECONOMY

"Everyone talks about retraining, but the problem is that these days, if you're out of work, there's not a job in the area you're trained in and not a job in the area you're retrained in. Everybody used to think services were exempt or high-tech jobs, but the new economy is being outsourced. Retraining is not the magic solution because there isn't an industry that is safe from the trend anymore that provides the solid jobs needed by the American middle class."

NO-ONE BENEFITS

"The fact is that the poor in other countries that are supposed to benefit from [outsourced U.S. jobs] don't. We're not against globalization, but the benefits just aren't there right now. [The countries that benefit from outsourcing or offshoring] get low-wage jobs, no benefits. Their standard of living actually falls. Their environments are destroyed because those countries don't have laws that adequately protect their environmental standards or their workers. And now countries that once benefited -- just look at Mexico -- from the outsourcing trend are suffering because there's always a cheaper place somewhere else to move to."

"In information technology, it's not simply a matter of cost savings. Cost is often the driver, but our clients are also looking for expertise they can't find or can't easily scale up. They are looking for flexibility. They want to improve the quality of their operations, and speed to market is often a big reason, especially when they look to noncore operations."

SKILL SHORTAGE

"People are surprised to learn that [U.S. workers] aren't that competitive anymore in many IT skills. Certain engineering degrees are hard to find. The number of computer science engineering graduates has been on the decline in the U.S. for the past 15 years. But you can get readily available talent in some offshore locations."

A GLOBAL ECONOMY

"We are a global economy now. We can't just focus on protecting jobs. We have to innovate and reinvest to create jobs. Certain jobs are lost, a permanent loss, but that process itself helps us stay competitive. Those firms that achieve better competitiveness will excel and reinvest and create more jobs. They won't be the same jobs, but different ones. And they will represent the next evolution of the economy."