Outsourcing and Jobs in the US
As more firms move call-centre or programming jobs offshore, the issue of business processes outsourcing is raging through the entire IT industry. One can understand the frustration of those who have to start looking for other jobs or of the clients who do not get their technical-support and maintenance questions answered. But the backlash may still be put to rest.
A late study indicates that the trend may be creating actually more, not less jobs. At least that would be the conclusion of a recent research made by Global Insight and financed by the IT Association of America (ITAA). Given the features of a more and more global economy, the globalisation of the IT industry follows as a matter of a consequence.
Most of the big IT concerns do pretty much of their non-core businesses overseas and obviously would like to have certain employees in these markets as well. Low salaries in some countries are also a serious incentive towards outsourcing several operations, especially since the high-speed communication of today easily removes most of the barriers standing in the way of dealing with U.S. colleagues or customers.
One may think that some of the criticism of offshoring is really misplaced. According to the quoted Global Insight study, from 1998 to 2003 outsourcing IT services and software monies spent increased from $2.5 billion to $10 billion; the figure could reach $31 billion by 2007-2008. It estimates also that as of 2003, nearly 104,000 IT software and services jobs were displaced. The same research states that 372,000 IT jobs have been lost in the US since 2000, accounting for about 10% of the total number of such jobs in the U.S.
Windows 2000, XP and Mac OS X are far from being perfect, but there is no question that they are way more stable than Windows 95, 98 or Mac OS 8 and 9. Hence, companies need less personnel to assist them. In the meantime, better server consolidation and desktop management have been significant problems for a long time, resulting also in the need for fewer such IT jobs. These trends are reflected in the job statistics as well. The IT jobs will not disappear altogether, but we may need a lot fewer.
The main reasons for this loss: the recession, the dot-com bust and the productivity growth. Interestingly enough, Global Insight also says that rather than reducing jobs in U.S.A., offshoring is lowering costs for everybody and actually is creating jobs, due to a more efficient economy. It says that some 200,000 new jobs - both IT and non - were created in 2003 granted to offshore outsourcing, whereas by 2007-2008 the number will reach over 589,000.
According to a study by Gartner, fewer than 5% of U.S. IT jobs have moved offshore. Of course, the creation of new jobs isn't much consolation for people who have lost their jobs. Still, moving some jobs offshore seems inevitable. There is no alternative. An increased productivity plays an essential role on the IT new job scene also: IT technical support requires nowadays fewer employees than it used to do.
Source: www.pcmag.com
