The outsourcing controversy may claim the first high-level casualty at the White House, which is reconsidering the proposed appointment of Anthony F Raimondo to head a new office for helping the struggling American manufactures, after allegations that his own firm offshored and laid off some US workers.

The Bush Administration wanted to announce the appointment of Raimondo, chairman and chief executive of a Nebraska company that makes metal buildings and grain silos, to head a new office to help the nation's struggling manufacturers, but the White House is now reconsidering the appointment, the Washington Post reported.

The need for reconsidering his appointment arise because John Kerry's campaign distributed reports that Raimondo's firm, Behlen Manufacturing Co of Columbus, Nebraska, had laid off 75 US workers in 2002, four months after announcing plans for a $3 million factory in northwest Beijing.

Bush aides said that Behlen, founded in 1936, has four US plants employing 1,000 people and a 150,000 square foot plant in China employing 180.

A senior administration official, who refused to be named because Raimondo has not been nominated, said Behlen has exported products to China since 1984 but was losing market share to other US firms.

The official said that half the equipment used to build the factory in China was made in the United States. "This is not a case of making goods more cheaply in China to sell back in the US," the official said.

Democrats contended, however, that Raimondo's record helps illustrate why the nation has lost 2.2 million jobs, most of them in factories, during the Bush presidency. The layoffs have been concentrated in such swing States as Pennsylvania, Michigan and Ohio.

Seventy-five minutes after the Administration announced a news conference with Commerce Secretary Donald L Evans to name the official, a new advisory went out saying the event had been "postponed due to scheduling conflicts."

Last night, three senior officials told the Post that Raimondo's nomination might be scuttled but added they did not know for sure.

President George W Bush had announced his intention to make the appointment several weeks ago.

Democrats have been saying that the long delay in naming the new assistant secretary reflected the low priority that Bush puts on preserving jobs.