Cutting costs is something of a mantra with business and the escalating costs of labour in the Irish market have been something of a concern to business, especially in high-technology where competition is intense and margins tight.

While the fear is always of multinationals moving their operations to a developing nation with lower wage costs, it now appears we might face unbeatable, if somewhat illegal, competition from within the US itself.

Some of the giants of Silicon Valley are facing an investigation into labour practices after allegations that Asian immigrants are assembling electronics components at home - sometimes for as little as a penny a part.

The stories said that at least a dozen contract manufacturers, ranging from small firms to multibillion dollar giants, had been involved in piecework arrangements within the past year, possibly in violation of labour, tax and safety laws.

Among the companies citing as using contract labour were Hewlett-Packard, Sun Microsystems and Cisco Systems.

None was prepared to comment to US media in advance of the investigation.