The IT Contractor Portal, Contractor UK reported that nearly fifty percent of IT firms are ready to relocate jobs overseas. This would place U.K.’s technology sector the most likely private industry employer to begin offshore operations.
According to 10 percent of all respondents seeking to ship jobs overseas from the U.K., India was listed as the favored offshore destination among 700 employers who were polled. Incidentally, the survey revealed that of all the employers in the U.K. that had plans to offshore jobs, only a fifth of the total were manufacturers. In contrast, about 44 percent stemmed from the computing and IT industries.
Co-authors of the study, The Chartered Institute of Personnel and Development, stated that outsourcing of these jobs were a medium term issue in the U.K. economy, roiled by the recent economic downturn.
Another trend that is propping up in the outsourcing scene is outsourcing to Brazil in Latin America, IT outsourcing in Philippines, and outsourcing to China and Vietnam. The CIPD said that companies were seeking to balance the right skills, cost savings and quality of goods and services and that this was not just about doing business in India.
Nonetheless, CEOs of UK IT firms that plan to offshore jobs, irrespective of their motivations, will be assured that India is ready to meet their demands on the heels of a recovery in the offing.
Incidentally, India’s industry body NASSCOM said at a major IT conference that it expects a whopping 150,000 IT jobs to be created in 2010. This is despite warnings of a slow recovery in other sectors, reports contractoruk.com. NASSSCOM said that India’s healthcare, retail and utility industries are picking up pace at a rapid rate – almost thrice as fast as core markets. This is an indication that these sectors will be quick to create IT jobs.
Analysts at TechMarketView commented that western IT firms are scurrying to get a piece of the Asian pie after India has dominated the outsourcing landscape for two decades. Chairman of Dell Services’ consulting wing, Jim Champy, said that Asian firms are likely to spend more money on IT outsourcing than Western counterparts. This translates to a reversal of the existing trend of more U.S. and European firms purchasing computer services than those in India.
U.K. IT services firm Steria has begun utilizing the company’s offshore services unit, after acquiring Xansa in order to tap India’s domestic market. Experts say that other Western majors are likely to follow so they too can tap into the growing appetite for IT outsourcing prevalent in the region.
NASSCOM has said that Asia will reel in more than a 25 percent of global consumption of BPO and IT services within the next ten years. That figure is up 20 percent from current targets.
Jacob Cherian writes for SourcingLine, a leading provider of directories on top ecommerce development companies and game development.