Let's help businesses create jobs in U.S.

Posted: March 19, 2013

Until a few weeks ago, I hadn't been to India since 1978. I was 17 then, and couldn't have anticipated that I would return 35 years later as governor of Delaware in search of economic opportunity for my constituents.

Here's my rationale: India is the fastest-growing market for U.S. exports, growing sixfold from 2000 to 2011. Its businesses have increased the value of their investments in the United States from $3 billion in 2007 to almost $9.8 billion in 2011, creating tens of thousands of jobs in the process. And India's economy is growing significantly faster than ours. It's projected to grow 5 percent this year - and pundits suggested that was "rock bottom." Wouldn't Americans love to have that problem?

I met dozens of business leaders who have created jobs in the United States and who have plans to create more. In Pune, I visited Bilcare, a world leader in pharmaceutical packaging. That company employs 100 Delawareans at a manufacturing plant in Delaware City. The company's founder, Mohan Bhandari, and I discussed how we can facilitate his success and employment growth in our state.

This emergence of foreign companies as major employers in the United States is the new world we live in.

There are clear areas of conflict and tension. Too many barriers limit American trade export opportunities. Too few visas frustrate the aspirations of Indian entrepreneurs to create U.S. businesses. Historically low Indian wages have led to significant frustration and real anxiety among American workers about outsourcing. And U.S. firms note that the creation of jobs here by Indian companies pales in comparison with the U.S. jobs lost to lower-wage Indian workers.

This "wage arbitrage" in favor of India helped launch their services and IT industries. But the idea that India's high-tech economy is still solely based on low-value services and low wages is mistaken. Indian IT firms are providing services ranging from analytics to enterprise mobility management to developing cloud technologies.

Almost all of the business leaders I met plan to expand their international operations. The key question is what we can do to make sure they expand in the United States.

When I asked that very question, they invariably told me about America's formidable strengths: a well-earned reputation for the most innovative culture in the world; open and robust financial markets; a highly transparent and corruption-free system of government; and a level of infrastructure that is far from what it should be but that is better than their own.

But these strengths only go so far. They acknowledged that many of their businesses have benefited over time from lower wages. But they also know that as wages for skilled workers in India rise, they will still need to recruit a talented workforce, wherever they can find it. This is exactly what I hear from American business leaders as well.

That's why so many states are investing in science, technology, engineering, and math education. That's why we increasingly emphasize public-private partnerships where students get real-world work experience. That's why governors are telling Washington that we need more flexibility to use federal workforce development funds wisely. That's why we are making the investments in quality of life that will attract and retain talented workers.

We will never win - and don't want to win - the battle of low wages. But we can grow our economy on the backs of a skilled, productive, and innovative workforce. In fact, that's the only way to make the 21st another American century.

Jack Markell, a Democrat, is the governor of Delaware. E-mail him at jack.markell@state.de.us.

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