Legislation Aimed at Curbing Offshoring


Outspoken constituents and uneasy American IT employees are turning up the heat on politicians to limit the outflow of jobs into foreign countries. In response, Democrats and Republicans alike have recently introduced a number of bills at the state and federal levels to place restrictions on offshoring practices. As of this January, there were “eight bills pending in Congress that in some way restrict the use of foreign workers in the United States or limit non-citizens from participating in government contracts,” many of which are still under consideration.


  Additionally, over thirty states have drafted legislation of their own. Only a few states have actually passed legislation restricting offshoring, but much is still pending. Each pink region in the map below represents a state with anti-offshoring legislation pending as of May 2004. Click on any pink state in the map below to get the details on pending legislation and unemployment trends in that state.


Many states have anti-offshoring legislation pending. Click on
the map below to see what's happening in your state:

Washington California Arizona Colorado New Mexico Hawaii Kansas Nebraska South Dakota Minnesota Iowa Wisconsin Illinois Missouri Louisiana Michigan Indiana Ohio Kentucky Tennessee Mississippi Alabama Florida Georgia South Carolina North Carolina Virginia Maryland New Jersey New York Connecticut Rhode Island Vermont

Here's a small selection of some of the more noteworthy examples:

  • New Jersey, Senate Bill 1349: State senator Shirley Turner got more than she bargained for when she proposed this enterprising legislation to ban the outsourcing of IT & other state contracts overseas, saying she’d “never gotten so much e-mail on any one issue.” Efforts of technology lobbying groups ultimately put the bill out of commission in 2003.
  • Washington State, House Bill 3187: Rep. Sandra Romero and Rep. Zack Hudgins cosponsored a bill that would prohibit state contracts from going to foreign employees unless the Office of Financial Management determines that hiring abroad is the only “realistic” option. "Our state is in its third year of a severe recession; we saw a net-growth of only 1,000 jobs in Washington last year,” said supporting representative Steve Conway. “This is no time to be sending taxpayer dollars and jobs to businesses and citizens outside our state.”
  • Michigan, House Bill 4940: Inspired by his personal conversations with unemployed Michigan citizens during his campaign trail, Michigan Representative Steve Bieda has launched an online petition in support of his own anti-offshoring bill that requires companies to employ only U.S. workers on state contracts. The bill was introduced in 2003 and commanded 38 cosponsors as of January 2004.
  • U.S. Senate: Senator Christopher Dodd’s U.S. Workers Protection Act seeks to ban offshoring on the federal level by prohibiting the privatization of federal jobs, purchases of goods and services, and state purchases made with federal funds to contractors who use offshore workers. An amendment of Dodd’s with the same goal was recently tacked on to the Defending American Jobs Act (below) by a vote of 70-26.
  • U.S. House of Representatives: The Defending American Jobs Act, introduced by independent Vermont representative Bernie Sanders, requires grant and loan-providing federal agencies to issue reports on how many employees their beneficiaries have overseas, and promises stiff financial penalties for companies that hire more employees from offshore than from the States. It has now advanced to the Senate.

Will anything come of the proposed legislation? Some lawmakers have argued that we need to stop hiding our heads in the sand and admit we are part of a global economy, complaining that a failure to select the most economical option ultimately means a waste of taxpayer dollars. Additionally, the fact that most anti-offshoring bills are divided along party lines (supported primarily by Democrats) cause many to be skeptical that anything will come of them. Managing director of the tech fund EGM Capital Michael Mahoney recently told CNN that “anybody who thinks the federal government is going to do anything to reverse the outsourcing trend is smoking dope.” Yet considering the level of public criticism, the many legislative proposals on the table, and the potential for a new federal administration intent on preserving American jobs, the offshoring issue is certain to raise voices and tempers both in and out of Congress.