So does this count as “good” outsourcing?

Whenever I talk to critics about offshore outsourcing, they tell me that the claim by proponents that offshoring addresses the problem of a skills shortage in the U.S. is bogus, that there are more than enough tech workers here to perform the necessary tasks. I don’t think that holds for the late 1990’s, when offshoring ...

By , a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University and co-host of the Space the Nation podcast.

Whenever I talk to critics about offshore outsourcing, they tell me that the claim by proponents that offshoring addresses the problem of a skills shortage in the U.S. is bogus, that there are more than enough tech workers here to perform the necessary tasks. I don't think that holds for the late 1990's, when offshoring and the H1-B visa craze started, but that's neither here nor there. The point is, they argue that firms have no compelling need to to outsource offshore since the set of necessary skills resides in the United States. Beyond the IT sector, however, there do appear to be instances where offshoring is a necessary and effective means of accessing a labor supply of specialty skills for which there is a shortage in the United States. Lindsey Tanner reports in the Associated Press of one example in radiology. The highlights:

Whenever I talk to critics about offshore outsourcing, they tell me that the claim by proponents that offshoring addresses the problem of a skills shortage in the U.S. is bogus, that there are more than enough tech workers here to perform the necessary tasks. I don’t think that holds for the late 1990’s, when offshoring and the H1-B visa craze started, but that’s neither here nor there. The point is, they argue that firms have no compelling need to to outsource offshore since the set of necessary skills resides in the United States. Beyond the IT sector, however, there do appear to be instances where offshoring is a necessary and effective means of accessing a labor supply of specialty skills for which there is a shortage in the United States. Lindsey Tanner reports in the Associated Press of one example in radiology. The highlights:

When a patient in Altoona, Pa., needs an emergency brain scan in the middle of the night, a doctor in Bangalore, India, is asked to interpret the results. Spurred by a shortage of radiologists in the United States and an exploding demand for more sophisticated scans to diagnose scores of ailments, physicians at Altoona Hospital and dozens of others are outsourcing work. Over the past few years, the number of nighttime emergency cases was swamping Altoona’s seven radiologists. “Somebody was waking up all night to cover all this extra work,” said Dr. Richard Wertz, a radiologist. And while that doctor was groggy, “we didn’t have the luxury of that guy taking the next day off.” Using radiologists halfway around the world where it is daytime, “solves that problem for us,” Wertz said. Such moves are part of the telemedicine trend, with technology enabling the speedy transfer of medical data over the Internet to a compatible computer anywhere in the world. That means radiologists in Australia, India, Israel and Lebanon are reading scans on U.S. patients. Despite fears of some doctors, advocates insist offshore radiology is not stealing U.S. jobs and replacing them with unqualified cheap labor. Most of the doctors are U.S.-trained and licensed, though Indian radiologists generally earn about a tenth of the estimated $350,000 median salary for those in the United States. More typical is the Altoona situation, which involves doctors such as Arjun Kalyanpur. A U.S.-licensed and credentialed radiologist, Kalyanpur got his postgraduate training at Yale University and runs a two-man service in southern India. The Pennsylvania hospital is among 40 that use Teleradiology Solutions…. In recent years, demand has far exceeded the supply of radiologists in the United States. A trade journal reported this year that an average of four vacancies existed for each radiology department at American academic centers since 2002.

Two questions on this:

1) I know nothing about the supply and demand of different medical specialties — is the statement about there being a drastic shortage ofradiologists an accurate one? 2) Assuming that the answer to the first question is “yes,” would traditional opponents of outsourcing concede that this case looks like a standard trade story that clearly provides value added to the United States?

UPDATE: This might be the most bizarre twist on outsourcing I’ve seen yet — Europeans emigrating to India to work in offshored call centers (thanks to N.D. for the link)

Daniel W. Drezner is a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University and co-host of the Space the Nation podcast. Twitter: @dandrezner

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