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Conor Sen

Remember Outsourcing? Tech Companies Do

The sector won't remain concentrated on the West Coast. Expect employers to shift work elsewhere in the U.S. and abroad.
And now comes the tech diaspora.

And now comes the tech diaspora.

Photographer: Thomas Lee/Bloomberg

Despite the best labor market in a generation, Americans remain worried about the future of employment. Lately, the big worry is automation of jobs. Experiments like Amazon Go's cashier-less store will perpetuate this anxiety. Americans perhaps should be more worried about an old-fashioned employment maneuver, however: outsourcing. The tech sector is already leading the way.

Outsourcing tech jobs is nothing new. Fairchild Semiconductor, perhaps the foundational company in Silicon Valley, opened its first Hong Kong factory in 1964. Two years later the company had more employees in Hong Kong than in California. Semiconductor production shifted to Asia decades ago, and iPhones are assembled there by Foxconn as well. IBM now has more employees in India than in the U.S.