11 Ideas for Obama's Jobs Summit

So, how does losing 5 million hi tech jobs affect the economy? Note: this does not include Manufacturing Jobs lost.

I am told that the average company expense for a Engineering Professional is $100,000 /yr which includes taxes & health & benefits. That is $500 Billion in wage expenses per year.

I remember that the average economic impact to a community is that money goes around 4 times, or $2 Trillion in US economy.

The US/State/Local government looses taxes on the $2 Trillion per year. Assume 30 % of this is taxes of some sort, so that is $600 Billion in Taxes per year that are lost.

JUNE 21, 2004

ECONOMIC VIEWPOINT

By Jeffrey E. Garten

Offshoring: You Ain't Seen Nothin' Yet

http://www.businessweek.com/magazine/content/04_25/b3888024_mz007.htm

Forrester Research Inc. (FORR ), the most widely quoted company on offshoring statistics, estimates that 3 million to 5 million more jobs will be transferred in the next 5 to 10 years. But that projection and others like it may vastly underestimate the future challenge. The combination of rising productivity made possible by widespread use of information technology, plus the unrelenting pressure on U.S. companies to continue to cut labor costs, guarantees that more work will be done in America by fewer people. In addition, from China to the Czech Republic, there is virtually an unlimited supply of industrious and educated labor working at a fraction of U.S. wages. And these workers' skills will be enhanced by the expansion abroad of the research operations of companies such as IBM (IBM ) and Intel (INTC ) employing local talent.

In a Forrester Research article, they estimated that a company saves around 15% by outsourcing/offshoring (considering associated expenses to outsourcing).

So, does it make sense to the USA for companies to save only $75 million and the nation to loose $2 Trillion per year to our economy and $600 Billion in Taxes?

Tom Willis of CO 7:05AM December 31, 2009