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Interesting piece in eWeek...

http://blogs.eweek.com//careers/content001/outsourcing/high_level_tech_jobs_have_moved_offshore_too.html?kc=EWKNLCSM09142010STR2 (http://blogs.eweek.com//careers/content001/outsourcing/high_level_tech_jobs_have_moved_offshore_too.html?kc=EWKNLCSM09142010STR2)

Friday, September 10, 2010 5:35 PM/EST
High Level Tech Jobs Have Moved Offshore Too
It has been well documented that low-level programming is a tough business in the U.S. as coding skills are found globally at a fraction of the cost that they are here at home. It's not only India, but China, the Philippines, Eastern Europe and other parts of the globe that are seeing an influx of outsourced work and filling the coding needs for many American businesses.

Professor Vivek Wadwha of Duke University's Pratt School of Engineering advises U.S. programmers to push hard to move up the corporate ladder in to management or consider shifting careers in to Sales or other career areas or face diminishing returns on salary over the long haul.

Yet, as some American companies like IBM and others are finding higher level talent abroad, they are also setting up their research and development facilities outside of the U.S. and reaping the cost savings, much to the demise of the American computer scientist. Despite government projections for technology to be a job growth area for the economy, many skilled workers are struggling to bounce back after layoffs and companies moving work overseas. A recent piece in The New York Times highlighted the plight of one master's-degree holding software engineer in Corvallis, Oregon who watched her job at a gaming development company and livelihood disappear. The company, Reno, Nevada-based International Gaming Technology, has moved all of its technology work from Oregon overseas.

In addition to lower wages, developing countries offer significant consumer growth, giving businesses a reason to make more products closer to the buyer, and hire locally. And increasingly, these new, lower-cost research centers, while perhaps initially intended to adapt products for local use, are becoming sources of innovation themselves.
"There's been this assumption that there's a global hierarchy of work, that all the high-end service work, knowledge work, R.&D. work would stay in U.S., and that all the lower-end work would be transferred to emerging markets," said Hal Salzman, a public policy professor at Rutgers and a senior faculty fellow at Heldrich Center for Workforce Development.

"That hierarchy has been upset, to say the least," he said. "More and more of the innovation is coming out of the emerging markets, as part of this bottom-up push."


That is not to say that more advanced skill sets are not desired here in the States, it's that the high tech is not bouncing back as surely and rapidly as many experts and economists expected (and there is not enough data being captured on the quantity of technology jobs moving away from the U.S.). Programmers are the ones facing the most uphill battle.

Wadwha wrote in a blog post on age discrimination in technology:

Move up the ladder into management, architecture or design; switch to sales or product management; or jump ship and become an entrepreneur (old guys have a huge advantage in the startup world). Build skills that are more valuable to your company, and take positions that can't be filled by entry-level workers. 

The success of this really depends on the globalization of the company.

For XYZ US company to start handing off work overseas is difficult.
Timezones, and lack of day to day management interaction is a big challenge to overcome.
Not to mention language and cultural issues.
You just can't hand off work (internationally or even domestically).

On the other hand if you are prepared to place some of your management overseas + HR + accounting (just like any other branch office) then there are savings to be gained.

The company that I am working for has two project offices in Mexico. I am a IT guy working for me there for 16K per year - 18k when all benefits and such is factored in.
Same guy in the US would easily be 70-80k and the cost of benefits would be another 35k.  I however have spent 8 weeks there in the last 20 managing this resource and projects.
If I lose a domestic worker, I can get HR to replace that person within 20 days. If I am trying to do the same in a foreign country without a HR team things can drag out.