IT offshoring is exaggerated and the IT labor shortage is real

[Omaha Steve]

http://blogs.zdnet.com/BTL/?p=10872

November 17th, 2008

Posted by Jason Hiner @ 2:13 am

The fastest way to raise the hackles of most U.S. IT professionals is to mention offshore outsourcing. Among them, there is a common perception that U.S. corporations are cutting IT budgets by laying off lots of IT professionals and shipping their IT jobs overseas, and generally wrecking a lot of IT departments in the process.

This perception has been driven by two sources: 1.) the media, which has latched on to outsourcing stories, and 2.) by several large and prominent U.S. corporations such as Dell and Citibank that have outsourced much of their consumer customer support to offshore companies in India.

However, new evidence shows that the IT offshoring trend is greatly exaggerated. The Society of Information Management’s 2008 IT Trends Survey shows that IT leaders are planning to increase offshore outsourcing in 2009, after two straight years of declines. Nevertheless, even with the increase, offshore outsourcing only represents five percent of projected 2009 budgets, and CIOs say they are still having trouble finding enough domestic IT workers with the right mix of skills to fill the open positions that they are keeping at home.

As you can see in Chart 1 below from the SIM survey, IT leaders reported that they plan to make offshore outsourcing 5.2% of projected 2009 budgets, a jump of two percent from the 3.2% in 2008 budgets and breaking the trend of two straight years of decreased outsourcing after it had previously peaked at 4.2% in 2006.

The global economic slowdown is obviously the most likely culprit behind the uptick. A lot of IT leaders will be trying to do more with less in 2009, or at least doing the same amount of work with smaller budgets. Thus, it’s likely that many of them who already do some outsourcing will be shuffling some work to their overseas partners in order to trim budgets.



FULL story at link.

[liberal N proud]

1. The company I work for fired all the IT people and now...

every time I call the help desk I get someone in India.

Last time you could hear the kids in the background.

For our company it is real.

[Eric J in MN]

2. To see if there is a shortage of computer programmers,

...you have to look at whether salaries for computer programmers have been skyrocketing or not.

Their salaries would skyrocket if there were a shortage.

[mnhtnbb]

3. The first workday of Jan 2008, my son and 3/4 of his tech support dept at

an international software company located in Cary, NC, were escorted to human resources and then out the door. The tech support dept was being relocated to India. Contract workers were hired to replace
all those laid off while they planned the switch.

[mnhtnbb]

7. Happy f*cking New Year.

[Tandalayo_Scheisskopf]

4. Oh yeah??

Horse shit. I have been applying for IT positions for a while now. I see a shitload of ads where they want certs and experience and degrees no single person has ever held, and they are literally offering 11-14/hour. Know what that is? That is an H1-B dodge. Run the ad for 3 months, then hire an H1-B. The practice is rampant in the IT industry.

What the IT industry needs, desperately, is unionization.

[bowens43]

5. Really?

The large corporation I work for just laid of 25% of it's IT people in the US. Of course, our IT groups n India and the Dominican Republic were not affected.

[chalky]

6. Huh. Couldn't tell it by My employer,

since they shut down our stateside IT helpline and sent it overseas.
Or maybe they're just splitting hairs, since the hands on work IS being done stateside--by "guest workers" who are regularly rotated out as soon as their work visas expire.