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Research firm expects to see more job outsourcing

One out of every four high-technology jobs in developed countries today may be outsourced to emerging markets like India by 2010, according to a report by the research firm Gartner Inc.

"Global sourcing is becoming a mainstream delivery model," said Ian Marriott, vice president at Gartner, at a Barcelona symposium and released by Gartner Wednesday.

"The potential cost advantages are so persuasive that companies that don't consider it seriously risk doing their shareholders a disservice. Businesses will also be put at risk due to loss of competitive advantage and inability to focus on growth through innovation."

India remains "the undisputed offshore leader," according to Gartner, with China and Russia emerging "as strong contenders" and many other countries eyeing the potential offshore IT services.

Outsourcing has been a growing phenomenon in the US and is catching on now in Europe as well, with last year a turning point.

"Last year saw a phenomenon in Europe," said Gartner vice president Roger Cox. "Out of 15 US$1 billion mega-deals signed in 2003, 10 were awarded by Europe-based enterprises. Until 2003, Europe-based organizations had only signed a total of 14 mega-deals since 1989."

He said British firms signed five such deals last year and France signed three, suggesting it has begun to overcome its cultural resistance to outsourcing.

Marriott said that based on these trends, outsourcing of jobs in information technology is likely to expand despite a backlash over the loss of high-paid, white-collar jobs in wealthy nations.

"We estimate that up to 25 percent of traditional IT jobs in many developed countries around the world will be situated in emerging markets by 2010," said Marriott.

"There is no doubt that the predicted shift in jobs associated with global sourcing is a harsh reality. However, there is nothing new about technology causing massive shifts in how and where people work. This is an unavoidable outcome of how the global marketplace operates today and western economies have been successful in navigating successive waves of economic transformation in the past."
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