Is Outsourcing Worth IT Job Loss?

CIO News asks what is happening in respect to technology jobs in the current environment. Is the global environment a drain on technology jobs here in the U.S.? A group of outsourcing experts gathered last month at the Emerging Technologies Conference at MIT to discuss the effect of globalization and offshore outsourcing on IT jobs in the U.S.

The reality is that offshore outsourcing is a growing trend. According to a recent study from Meta Group, the worldwide offshore outsourcing market is worth $10 billion today and will grow 20% annually through 2008. Meta also claims that offshoring growth will outpace outsourcing in general and predicts that the average enterprise will offshore 60% of application work by 2008 or 2009.

Regarding job loss, a study from the U.S.-China Economic and Security Review Commission, found that up to 406,000 U.S. jobs will be moved overseas this year. The offshore job tracker on TechsUnite.org reports that more than 259,000 jobs have been sent offshore from Jan. 1, 2000 through Oct. 12, 2004. The site also claims that 142,500 jobs have been lost as a result of offshore outsourcing during this same time frame.

"You have three choices: remain competitive, choose a new industry or go down a misguided path of tariffs and closed markets," he said. "We rightly chose to have a minimum wage in this country and not to allow sweatshops. By doing so, we accept that we may not be able to compete in some industries where cheaper labor and lower costs of living can produce the same products at a fraction of the cost."