Government Contractors Go “Offshore” for Tech Workers: to Rural America
The Washington Post reports at length: “Mining Coal Country for Tech Workers; Economics, Politics Send Contractors Into Southwest Virginia”
LEBANON, Va. — In this town of 3,300 people, cow pastures encase the local high school, churches outnumber nightclubs 14 to zero and the unemployment rate is almost twice as high as the rest of the state.
This is where government contractors CGI-AMS Inc. and Northrop Grumman Corp. will in the next few months start building multimillion-dollar technology centers and hire hundreds of software engineers at salaries far above the region’s average, bringing a taste of Washington’s lucrative tech sector to a coal country enclave. . .
Most companies expect to save 30 to 40 percent on projects done through a process dubbed “onshore outsourcing,” or “farmshoring.” The average salary for the 300 people CGI-AMS expects to hire in Lebanon, for instance, will be $50,000 — far above the town’s $27,606 average annual wage but about half the salary an advanced software developer in Northern Virginia might earn.
Lebanon, VA might as well be in another country — in terms of culture, economics, and lifestyle — compared to the Northern Va. DC suburbs, the part of the state where this tech work has historically been concentrated.
That other country has a name: Appalachia. See map, with Lebanon marked with a red star (zoom out 3 steps to see in context of multi-state region, with Appalachian Mountain range marked in relief).
Here’s what motivates this domestic version of “offshoring”:
The job market in Washington is so tight, companies regularly pay bonuses and inflated salaries to recruit employees with technical skills, even though the work required to develop new software programs has become increasingly routine.
Banks and insurance firms long ago cut their software development costs by shipping the work to India and China, but legal restrictions and the politics of government procurement have prevented federal contractors from following suit.
So they are looking at rural America instead — to places where rents are cheap, traffic is light and, instead of companies being forced to offer bonuses or poach employees from a competitor, resumes pour in by the dozen.
I applaud this development.
You miss a lot of America if your only US travel experiences beyond your own major metro area involve flying over our glorious wide open spaces and charming — if sad and worn — small towns, in order to visit tourist areas or other major metro areas. You miss much even if you drive, but stick to the Interstates.
Part of what you miss are the economic disparitities between much of small-town and rural America and our better-off urban-suburban neighborhoods, which at times approach those between these neighborhoods and the impoverished inner city ones.
But you also miss the great potential of the flown-over areas. The delightful lifestyle you could have living and working in a restored old farmhouse, and doing all your work via Internet, for example. And, as the Post article indicates, the bargain workforce you might find there for your business.
