Forget IT, Australian students told

The rampant outsourcing of IT jobs could well sound the death knell for Australia's technology industry, an IT Manager Australia survey revealed.

ITM members were asked if students in Australia would be discouraged from considering IT as a career if offshore outsourcing continued to shrink the local employment market.

More than 90 percent of members said based upon current conditions, they wouldn't recommend information technology as a viable career path.

"I'd rather my kids opt for nursing as a profession--it has both local and global demand," said ITM member James Michaels, who works for a telecommunications company in Sydney.

Michaels said there was a huge "disconnect" in the supply and demand chain. "I think we've reached a saturation point...there's just too many skilled techies out of work and they're all fighting for either the same pie or the scraps left behind post-outsourcing," he said.

Occupational hazard
For some IT undergraduates, there's no turning back. "As a Computer Science student at Melbourne University, I can say it is almost guaranteed that students will shy away from IT as a career without outsourcing legislation," said ITM member Jesse Stratford.

"My peers and I are very much aware of this [offshore outsourcing] situation and watching it with great interest lest our expensive, hard-earned education be thrown out of the window for the sake of lining the pockets of big businesses," Stratford added.

According to market research firm Gartner, offshore business process outsourcing (BPO) is expected to reach US$1.8 billion in 2003 on a global basis, representing a 38 percent increase from the previous year.

Gartner said India will represent 66 percent of the offshore BPO market or US$1.2 billion. "Most of today's offshore BPO opportunities in India are relegated to contact centres and back office transaction processing," said Sujay Chohan, Gartner's research vice president.

But it's not all doom and gloom, as one member said: "We need to be careful not to confuse "offshore" development with round-the-clock surveillance," wrote ITM member Peter Hannan.

Hannan explained that in many instances, it was logical to have service provisioning (network monitoring, for instance) overseas in a follow-the-sun arrangement--especially for multinational companies.

"Such arrangements generally provide commercial sense and have the by-product of reciprocity for our talent pool," he added.

Advertisement

Talkback 11 comments

    Though outsourcing is difficult to stop, what I call "insourcing" can be byt our elected politicians here in the USA care more for their pockets than their constituents. The US visa programs are a complete disgrace to American citizenMichael T. Emmons -- 09/07/03

    Though outsourcing is difficult to stop, what I call "insourcing" can be byt our elected politicians here in the USA care more for their pockets than their constituents.

    The US visa programs are a complete disgrace to American citizens.

    George Bush says his tax cuts will create 1.2 million jobs? For whom and where?

    I am one of 20+ Americans that were mandated to train our foreign replacement workers; in Lake Mary, FL. Those workers are Tata Consulting(TCS) India employees. TCS India transfers their employees from TCS India to TCS USA using the congressional H-1b and L-1 "intra-company transfer" work visas. Their goal, the jobs we did. Once the training was completed the Americans were laid off.

    Our management brought the Americans into a room and told them they would be laid off. But first they said, "we want you to train your replacements". They held out a carrot for the Americans, a severance; "stay on and we'll give you this severance when you leave."

    Over 9 months of begging and pleading for help from the likes of FL Senator Bob Graham(D), FL Senator Bill Nelson(D) and FL Representative John L. Mica(R) have gotten us nowhere.

    TCS India has done this so many times they have become complacent. They put their entire replacement project documentation( 500MB/800 documents) on the shared drive at Siemens. Among those documents are the "infamous" knowledge transition documents.

    That would be knowledge transfer from AMERICANS to Indians; right here in Lake Mary, FL. Those documents were provided to the DOJ, DOL, INS, Senators and Representatives. Did they do anything? Not a chance in hell.

    You'd think your US representative would care about Americans being pushed out of the industry by foreigners on H-1b and L-1 visas. Not ours. Our representative, Rep John L. Mica was in contact with Siemens. During the exact timeframe we were pounding his office for help(Aug 15-Dec/2002) he was cashing campaign contribution checks from Siemens. You can see them right here at http://www.OutsourceCongress.org:81/USA/tata/Mica_Contributions.html

    This was the most demoralizing time of my life. The worst part was not Siemens nor TCS, nor the Indians. The worst part was the lack of support from our political leaders.

    I am working overseas because of a shortage of IT jobs in Australia. I doubt that I will come back to Australia because the government is encouraging companies to give jobs to other countries rather than look after Australian citizens. Just a yAnonymous -- 09/07/03

    I am working overseas because of a shortage of IT jobs in Australia. I doubt that I will come back to Australia because the government is encouraging companies to give jobs to other countries rather than look after Australian citizens.

    Just a year or two back, when IT jobs were disappearing, the Australian government told companies to outsource to India. Then it has the gall to say that there is no shortage of IT jobs in Australia.

    Unless the government gets a sudden dose of intelligence, the IT industry will be almost dead in Australia. It is yet another case of Australian skills and knowledge that have either left the country or been left behind.

    ok i knew this would happen 6 years ago every man and his dog wants to get in and theer is only so much to do with teh technology being so easy to do with plug and play software that everyone can us it has spelt teh death nell for the little it Anonymous -- 09/07/03

    ok i knew this would happen 6 years ago
    every man and his dog wants to get in and theer is only so much to do
    with teh technology being so easy to do with plug and play software that everyone can us it has spelt teh death nell for the little it person
    with companies leasing there machines it is easy to then just get the it from teh company when things go wrong replace teh machine at little or no cost
    saving huge amounts for teh company

    The same sort of thing is happening in North America. One thing I never hear mentioned is the loss in tax revenue to the govenment. Do Indian employees of Australian companies pay Australian income tax? Is the company required to withhold a percentage Anonymous -- 10/07/03

    The same sort of thing is happening in North America. One thing I never hear mentioned is the loss in tax revenue to the govenment. Do Indian employees of Australian companies pay Australian income tax? Is the company required to withhold a percentage of their salary to pay the taxes? Is at least a percentage of the savings due to the difference in taxation levels between India and Australia?

    Folks, it is a common misconception that the government exists to serve the population. It is simply not true anymore. Having worked in IT for the government, I can assure you all that lining the pockets of business, and therefore themselves is the sole aIT worker -- 10/07/03

    Folks, it is a common misconception that the government exists to serve the population. It is simply not true anymore. Having worked in IT for the government, I can assure you all that lining the pockets of business, and therefore themselves is the sole activity of importance. Transparency is gone, justice is gone, the "free market" is free only for those big enough to play the "bribe the pollies" game. Treating skilled people as just another commodity is typical of the modern political age and should not be surprising.
    "It is a common misconception that we are led by incompetant folk who mean us well. The exact opposite is true!"

    Tele-commuting has not really taken off. Given that an option of having someone work from home 3 days a week and work in the office the other two is not acceptable to most employers (even if the employee is willing to take a pay cut) there are obviously Russell Coker -- 10/07/03

    Tele-commuting has not really taken off. Given that an option of having someone work from home 3 days a week and work in the office the other two is not acceptable to most employers (even if the employee is willing to take a pay cut) there are obviously many areas in which people who tele-commute 5 days a week won't be acceptable.

    But even if outsourcing to India did decrease the market for Australian IT people, that wouldn't necessarily be such a bad thing. The demand for people with IT skills has been increasing far faster than supply can cope for most of the 1988-2001 period. If a decrease in demand can allow supply to catch up then this will be a good thing for employers and for customers of IT based companies.

    Regardless of these issues, people who want to succeed and are willing to work will be successful.

    Rus, I think you missed out a couple of key words. "Regardless of these issues, people who want to succeed and are willing to work FOR PEANUTS will be successful."Anonymous -- 11/07/03

    Rus,

    I think you missed out a couple of key words.

    "Regardless of these issues, people who want to succeed and are willing to work FOR PEANUTS will be successful."

    One of the benefits of having the bloom off the rose of IT is this: many small firms, especially professional services firms, had one of the guy on staff, an engineer or an architect, or whatever, who did the IT. Now that IT is not sexy, this guy is goingPaul Jenkins -- 17/07/03

    One of the benefits of having the bloom off the rose of IT is this: many small firms, especially professional services firms, had one of the guy on staff, an engineer or an architect, or whatever, who did the IT. Now that IT is not sexy, this guy is going back to his bread and butter and there is more out-sourcing going on. The key is to find firms where the employees bill more per hour then you do. I have been doing okay using this approach - I don't want to brag because that's a way to jinx business - and I look at everything from the cost/benfit approach of management. I don't troubleshoot PCs (unless it is something I know is going to be short)but I do rebuild them, etc. I am looking at getting into the outsourced business myself be partnering with an Indian firm to do desktop support with voip etc, and then reselling it. Globalization is a process that is unstoppable (just like technology) and when you make it your friend, it is sweet. Get over it, move on. One thing that you have in your advantage is that you understand the culture of the place where you live. At some point, people want/need to talk to someone who speaks their language culturally. So so the cultural front-ends on these things and farm out the grunt work to the people who are destroying value in the marketplace by turning themselves into commodities. You cannot (and should not)compete with that, end of story. Managers need people who can understand their problems and make things work. They will always need people they can relate to. They can't pick up a phone and talk to some guy around the world and tell them what they need if the guy has a thick accent and doesn't culturally get it. There are plenty of opportunities everywhere - don't buy into the doom and gloom scenarios. Deal with smaller companies if the big ones aren't working out

    This recent article on oursourcing has some merit, particularly with respect to the comments on India. As most of us in Australia may appreciate, India is very much poverty stricken and IT skills offer the locals an opportunity to break out of it. Anonymous -- 18/07/03

    This recent article on oursourcing has some merit, particularly with respect to the comments on India.
    As most of us in Australia may appreciate, India is very much poverty stricken and IT skills offer the locals an opportunity to break out of it.
    Over the past 10 years, as an analyst I have seen this happen as India establishes lower import duties for goods (particularly IT!)and State Governments offer greater incentives for businesses to establish themselves. Foreign capital investors begin to show interest when these factors are included - along with the extremely low cost of labour!!.
    As far as my own kids are concerned, I only hope they take up IT as a hobby and get some joy out of it that way - not necessarily as a career!!!
    I can't help but feel that Australia is sitting on the fence with respect to IT. It will still progress in the short to medium term but I cannot put my finger on a plan that will establish itself as a world IT strength.

    Some great comments there! I have been in the "IT Industry" for over 20 years and have seen the governmen(s) telling us that we should be the "Intelligent Australia", and look to technology - then the jobs dried up! To thosAnonymous -- 05/08/03

    Some great comments there! I have been in the "IT Industry" for over 20 years and have seen the governmen(s) telling us that we should be the "Intelligent Australia", and look to technology - then the jobs dried up!

    To those who have another opinion (about th jobs available) try applying for jobs- I have applied for well over 120 in the last 5 months and I do have the skills. I am now doing a very poorly paid unskilled job outside the industry.

    We are looking at another crisis coming to Australia, not only in the IT industry, as skills are devalued and lost to "technology". Look at the clothing industry, for example, we don't have one anymore in Australia. We used to export food, now we import it. What will be next? Building industry as we can import kits from China cheaper than making them in Australia and then we would need unskilled monkeys to put the homes together?

    I pity the upcoming generation who will be pure consumers with no skills.

    Why can't the west tolerate when a developing country like India gives them a competition. If i get $500 in India i can live like a prince. In fact i am here in Australia as a student doing post graduation in an IT subject in one of the top university in Sudhir -- 21/10/03

    Why can't the west tolerate when a developing country like India gives them a competition. If i get $500 in India i can live like a prince. In fact i am here in Australia as a student doing post graduation in an IT subject in one of the top university in Melbourne. I came here becuase i didn't get admission in good engineeing institutes in India. I have noticed that most people in Australia between the age 15-25 engaged in partying, going out with gals etc. How can you people give competition to Indians who start preparing for IIT-JEE exams right from 10 years old. Now way forget it......

Add your opinion


Latest Videos

Blogs

  • Chris Duckett PayPal launches Aussie developer program
    PayPal announced the opening of its certification program for Australian developers today, making Australia the first country outside of the US to offer certification.
  • Array Cash cow in a BigTinCan?
    Around one third of Australia's telcos have shut their doors over time, but that isn't stopping new ventures hoping to chip away at carriers' mobile call bonanza. By fighting carriers at the smartphone rather than the home phone, could the latest two contenders be onto something big?
  • Array A third of the way to a zettabyte
    This week on Twisted Wire we look at how internet usage is changing in Australia and around the world. How are we meeting this demand and how is the cost structure changing for the service provider?
  • More blogs »

Tags

Back to top

Featured