JOB LOSSES SAP MORALE OF WORKERS - PLEASANT HILL MAN'S SUICIDE POINTS UP A RISING ANXIETY OVER OUTSOURCING AND THE TECH ECONOMY
More than once, Flanagan shakes his head. "It's a shame," he says. "We lost a good friend and a good mind."
One month ago, Kevin Flanagan took his life in the parking lot of Bank of America's Concord Technology Center, on the afternoon after he was told he had lost his job.
It was "the straw that broke the camel's back," his father said, even though the 41-year-old software programmer suspected it was coming. He knew that his employer, Bank of America Corp., like other giant corporations weathering the economic storm, was cutting high-tech jobs. He knew that Bank of America was sending jobs overseas. He had seen his friends and coworkers leave until only he and one other person remained on the last project Flanagan worked on.
Flanagan took steps to soften the blow. He considered studying law, and even made a list of California schools he was interested in researching. He applied for other jobs at the bank, but didn't receive responses.
In e-mails to his father, Flanagan sounded lighthearted. "I'm safe!" he would write in his Friday missives. "I'm safe for another week."
But Flanagan apparently masked the depth of the distress he felt as he fought to save his position. "He felt like he was fighting a large corporation that pretty much didn't care," his father said. "This final blow was so devastating. He couldn't deal with it." The father said he saw no other signs of depression before his son's suicide.
It is unclear if Flanagan lost his job because it had been sent overseas, or because the bank was slimming down because of the tight economy. Lisa Gagnon, a Bank of America spokeswoman, declined to comment, saying, "We're deeply saddened by this tragedy. We send our prayers to his friends, colleagues and family."
But his death underscores the anxiety that has swelled among technology workers at Bank of America and elsewhere as more businesses shift high-tech jobs and responsibilities to contractors offshore even as they cut jobs in the United States.
A report by Forrester Research projects that, led by the information-technology industry, 3.3 million service jobs and $136 billion in wages will move from the United States to such countries as India and Russia over the next decade or so.
Another survey by A.T. Kearney said that U.S. financial-services companies are planning to send overseas 8 percent of their workforces, thus saving them more than $30 billion.
Coupled with a rough economy and high unemployment, the phenomenon has left U.S. workers looking over their shoulders, wondering if their overseas counterparts could soon replace them. Blue-collar manufacturing jobs have for years crossed U.S. borders and waters. Some workers are bitter that white-collar, high-paying technology jobs are next.
"It could be me," said a Bank of America information-technology employee who spoke on the condition of anonymity. "It could be anybody."
Flanagan's parents say that he complained about the company's move to shift jobs out of the United States and talked about taking care of problems that contractors in India couldn't solve.
"Outsourcing has led to tragedy for us," said Tom Flanagan. "We are devastated."
Flanagan landed at Bank of America seven years ago after spending time at a San Francisco technology company and at ChevronTexaco Corp.
The Concord Technology Center, a cluster of four buildings that opened in 1985, employs programmers such as Flanagan to develop software programs that handle jobs like wire transfers. Throughout the Bay Area, the bank employs some 13,400 workers; the bank would not release the number of workers at the Concord center.
About two years ago, Bank of America created the Global Delivery Center to identify projects that could be sent offshore[JNI2]. In the fall of 2002, it signed agreements with Infosys, whose U.S. headquarters are in Fremont, and Tata Consulting Services, two of the largest players in information-technology consulting and services in India.
Overall, this deal should affect no more than 5 percent of the bank's 21,000 employees, or about 1,100 jobs, in its technology and operations division, Gagnon said. So far, it has been less than that, she added.
But Gagnon declined to say how many U.S. and Concord workers have been affected so far.
"It's important to note that just because we decide there is a good business reason to send a project (overseas) does not mean it will necessarily result in job displacement," she said.
Employees at Concord, who spoke on condition of anonymity, described shrinking project teams as work is shuffled around. One veteran worker said that in the middle of a project, he and his team members were asked to hand over documentation and explain their work to a group of engineers from India. He and his co-workers were then transferred to another project. A short time later, he lost his job.
Gagnon confirmed this, saying that in some cases it made sense to have workers train their overseas successors before they are let go.
"The knowledge transfer is essential to continue to provide our customers with the best possible services and solutions," Gagnon said.
One software engineer, who was laid off about two months ago, said that he lost his job because the bank was tightening its budget. But he argued that had other technology jobs not been moved offshore, he would have had more opportunity to shift jobs.
The harshest critics have called Flanagan's death an example of the collateral damage brought on by businesses expanding their offshore operations. A former software programmer said that morale in the office is so low that some employees feel like they're on "death row."
"Every day you think, 'Is this the day I'm gone?'" he said. "The next day you think, 'Is this the day I'm gone?' The stress builds up."
But other Concord employees have taken it in stride. "It's a fact of life in business," said one worker. "It's not perfect here, but it's a pretty darn good place to work," he said.
Proponents say that hiring technology workers overseas will make the company stronger: For one, it cuts costs. A contractor in India, the most popular locale, is typically paid $10,000, compared with $100,000 for a U.S. worker with the same skills. Proponents argue that this allows companies to stay competitive, saving and creating U.S. jobs.[JNI3]
Growing overseas does not necessarily translate into a loss in the United States, said Debashish Sinha, principal analyst for information technology services at Gartner, a research group.
"Very rarely is there a direct staff substitution," he said. "Very rarely will a U.S. enterprise lay off their internal IT folk to hire an external offshore service provider."
But as offshore workers graduate from basic jobs to more sophisticated technology work, critics here wonder if there will be high-paying, high-tech jobs left in the United States.
"There's a huge hole opening up here and no one is seeing it," said Pete Bennett, a former technology consultant in Danville who is now in the mortgage industry. He founded NoMoreH1B.com to protest businesses bringing in non-U.S. workers through the government's visa programs for highly skilled workers, a program that he believes helped fuel businesses' move to transfer jobs offshore.
A few weeks before his death, Tom Flanagan helped his son on yet another home improvement project in his Pleasant Hill fixer-upper. That night, they stayed up until 4 in the morning, "just shooting the breeze."
They often had these long discussions, about California politics, about the Enron debacle, about other world issues. They would argue until they couldn't keep their eyes open.
"He would never give up," Flanagan said. "He would never give up. But he gave up."
In a note that he left behind, Kevin Flanagan said that he felt like he had finally found his home when he moved to Pleasant Hill and landed his job at Bank of America.
"He loved working there," his father said. "He loved his house. He loved it here. He was happy. This was his life."
Ellen Lee covers technology and telecommunications. She can be reached at 925-952-2614 or elee@cctimes.com.
