Society of Information Management’s (SIM) 2008 IT Trends Survey shows different picture than prevailing perception about IT outsourcing. The data shows that US companies are not laying off IT staff and shipping jobs overseas to cut IT budgets. “There are more jobs than there are qualified people”, said Jerry Luftman, an IT professor and the SIM director.
The common perception about offshore outsourcing is built by two things (i) media exaggerating IT offshoring and (ii) prominent and large companies outsourcing much of their consumer support to offshore companies.
The recent research conducted showed that offshore outsourced staff budget is just 5.2% of overall IT budget allocation for 2009. This is higher than last two years’ figures: 4% and 3.2%. In the catastrophic period of global slowdown such increase is a pleasant breeze for offshore IT services companies. The scarcity of qualified candidates in the labor market may be the reason for companies thinking to outsourcing their IT work. This outsourcing is still a very small fraction. The bigger threat to US IT sector is labor crunch issue which is going to become more acute with the impending retirement of Baby Boomers and the smaller-than-needed numbers of math and science students that are graduating and looking for IT jobs.
The offshore outsourced staff budget (5.2%) is much lower than 33.7% budget allocated to internal staff. It is still smaller than 6.2% pie allocated for dedicated domestic outsourcing. In 2009 offshore outsource staff budget has got increased as compared to previous years. Along with that budget for dedicated domestic outsourcing has got increased in 2009. In reality, US is creating more jobs for local candidates than previous years in IT sector.
The activities that SIM does to increase awareness of IT as a viable profession and maturing college IT programs may address problem of IT professionals availability but the big thing is that it is changing or will eventually change the perception about offshore outsourcing.