Is Offshoring Slowing Down?

BusinessWeek Online reports the wage gap between the US and Asia is quickly narrowing which could diminish the cost savings of sending work overseas.

"The demand for English-speaking service workers in Bangalore is so high that GE as well as Infosys Technologies (INFY ) and Tata Consultancy Services are now looking outside major Indian cities to set up new call centers and other operations because they can't recruit enough college-educated people. The same is true in China."

"What does that tell you? Most of the best and brightest Indians and Chinese are already fully employed and are negotiating higher wages and benefits for their work."

"This is a significant development offshoring. Honest corporate managers will tell you that to make offshoring work, you need at least a 300% to 400% wage spread between American software writers, engineers, accountants, and call-center employees and their Indian and Chinese counterparts."