Recent News on the Outsourcing Front
- There has been a plethora of news stories regarding the future of outsourcing and IT jobs. In my research I came across a Blog that is maintained by the Staff at the Ubikwiti website. The Blog entitled Stemming the Outsourcing of IT Jobs cites freelance writer Rachael King for BusinessWeek.com. King reports that speaking to Ohio workers President Barak Obama stated, “We’re not looking to create just any kind of jobs here; we’re looking to create good jobs that pay well and can’t be shipped overseas.” The Blog posting on the Ubikwiti website goes on to make some interesting claims, such as:
- 140,000 more jobs will be moved offshore by 2010 (Hackett Group December 2008 report).
- 25% of all IT jobs at the largest global corporations will be outsourced by 2010.
- The posting then touts some of the spending items in the current stimulus package:
- $20 Billion for health information technology and the building of its infrastructure.
- $6 Billion to improve broadband internet access.
- $11 Billion for modernizing the power grid.
The above statement by Barak Obama and the planned spending as stated above, with the intended purpose of creating jobs here at home that cannot be “shipped overseas”, does not comport very well with his newest appointment to his National Economic Council. David Sirota reports in his Blog Article, More to Promote Outsourcing Than Anyone Else In America, on an Op-Ed piece by Ron Hira, a professor at Rochester Institute of Technology and a progressive. President Obama has appointed Diana Farrell of McKinsey & Co. to his inner circle of economic advisors. As Hira states, “Farrell's firm made millions of dollars consulting with companies, advising them to accelerate their offshoring. And she publicly made the rounds to convince policymakers and the public that offshoring was good for them and the country.” She is also the co-author of a study entitled Offshoring: Is it a Win-Win Game?, which Hira claims did more to mislead the American public on the impact of offshoring than any other debate.
The inconsistency of the above has to give one pause. On one hand Obama states he does not want to ship jobs overseas and on the other hand he appoints, arguably, one of the most pro-outsourcing executives in this country to a top economic post. Now we throw into the mix an article in Financial 24 entitled Outsourcing Gets Crimped by Recession and its report of the troubles in India and the outsourcing field is wide open. Financial 24 reports on the convergence of several factors that may bust the Indian market for outsourcing. These factors converging at once are:
· The global recession – no more needs to be said on this one
· The Mumbai Terror Attacks of November 2008. This caused great concern regarding India’s ability to provide adequate security, especially for US Companies.
· The financial scandal of India's fourth-largest outsourcing provider, Satyam. There are many questions whether there is enough regulatory oversight of India-based outsourcing providers.
In light of the serious situation facing the Indian outsourcing market, here is a list of the next emerging outsourcing destinations:
- Cebu City, Philippines
- Shanghai, China
- Beijing, China
- Ho Chi Minh City, Vietnam
- Krakow, Poland
- Kolkata, India
- Cairo, Egypt
- Sao Paulo, Brazil,
- Buenos Aires, Argentina
- Shenzen, China
- Hanoi, Vietnam
- Chandigarh, India
- Curituba, Brazil
- Prague, Czech Republic
- Pasig City, Philippines
- Dalian, China
- Coimbatore, India
- Santiago, Chile
- Colombo, Sri Lanka
- Johannesburg, South Africa
"20 emerging outsourcing destinations" by Sriram Vadlamani.
