(Business 2.0) – When I moved to California last year, you didn't have to reel off unemployment statistics to me. I could tell that Silicon Valley was hurting by the sheer number of people I met who were out of work. It hit home when my daughter became friends with a girl whose father, a highly paid network engineer who'd been unemployed for the past year, decided to take a job back East. The worst part for him: His new employer wouldn't pick up any of his moving expenses. His manager told him point-blank that while the company wanted to hire him, there were too many qualified local candidates for it to justify the expense. My friend ended up moving his family across the country on his own dime. That's got to leave a lousy taste.

After reading senior writer Paul Kaihla's cover story ("The Coming Job Boom," page 96), I'm more convinced than ever that too many companies have their people strategies wrong. While it may seem ridiculous to point this out today--with unemployment at 6.2 percent and the tech sector hit especially hard--the fact is we're headed for a skilled employee shortage unlike any in history. Where will you get your info workers in 2010, when the inexorable laws of demographics guarantee we'll be five years into a labor crunch? And how are you going to retain employees if you act like a cheapskate?

One longer-term answer, of course, is that we'll find workers overseas ("The Outsourcing Solution," page 159). As companies outsource more and more functions, they're finding that moving things offshore makes financial sense and doesn't sacrifice quality. Japan, once considered the land of cheap knockoffs, became the world capital of manufacturing prowess; similarly, India is transforming itself from a cheap code plantation into a software powerhouse. Our Cheat Sheet will help you plan your offshore moves.

Some argue that offshore outsourcing takes jobs away from American programmers, but to my mind, that's just protectionist talk. If you believe in free trade, as I do, the United States will do just fine--and the money that companies save by outsourcing will free up capital to invest in new, more rewarding kinds of work.

Even the most optimistic projections for outsourcing won't fill the worker gap as baby boomers retire. If I could buy futures in business schools, I would, since that's increasingly where employers will look for highly trained, technologically sophisticated managers. This month we have a feature designed for anyone looking for new talent from the MBA ranks. "A Talent Hunter's Guide to Business Schools" (page 114) skips the tedious columns of tuition costs you'll find elsewhere and tells you what you really need to know to find the right people. And for the "value shopper," we've found five schools you might not be familiar with that are real gems.

Of course, simply solving employment issues won't guarantee the success of the U.S. economy--especially if you believe that all roads lead back to the Net. Our ability to compete could be seriously hobbled by how quickly we build out broadband in this country. As George Gilder argues in this month's edition of The Point (page 180), the broadband we have in the United States isn't nearly broad enough. Amen to that. You might not want to offshore your family to South Korea, but if its 8-megabits-per-second-to-the-home national network keeps pumping up the economy, you might have to give it serious thought. Maybe a Korean company will even pay your moving expenses.

JOSH QUITTNER, EDITOR jquittner@business2.com