Offshore outsourcing anger will ebb in 2004: Gartner

Related video

The backlash against India caused by outsourcing will fade away in two years, according to analysts from IT market research firm Gartner.

Gartner principal analyst Rolf Jester, quoted in the India-based Business Standard news daily, said the current unhappiness felt by U.S. workers and politicians about IT jobs being relocated to India will ebb as the global economy improves and unemployment levels decrease.

"There is a global economic recession leading to loss of jobs. The politicians are capitalising on this. However, once the economy picks up, all this will disappear," Jester was quoted as saying.

Jester was speaking at the Gartner India Summit 2003, held July 16 and 17 in Mumbai. A hot topic at the two-day seminar was business process outsourcing (BPO) and offshore IT services.

Offshore outsourcing is now a "mega-trend", according to Gartner analysts quoted in the Indiatimes news daily, a development that will cause up to 10 percent of IT professionals in the U.S. to lose their jobs by 2004.

Offshore outsourcing is also the fastest growing IT industry segment, growing at a compound annual rate of 29 percent, according to Gartner.

India-based IT companies and U.S. multinationals are concerned about the political backlash arising from the export of jobs from the U.S. to India, even as the trend grows year by year.

At the seminar, Gartner analysts told Indiatimes and the Financial Express daily that it was unlikely that the U.S. government would curb firms ramping up hires in India while downsizing in the U.S..

Despite bills passed in the U.S. houses of government aimed at slowing or even stopping offshore outsourcing, none have been passed into law yet, observed the Gartner analysts, as American authorities tend not to interfere with the right of businesses to operate in the most competitive manner possible.

However, Indian firms should not ignore the problem completely and should manage some of this unhappiness overseas by hiring local staff in countries such as the U.S. and U.K., and forming partnerships with local firms, said Partha Iyengar, research VP, Gartner India.

Talkback

Gartner is full of bullshit, and has the audacity to predict that the economy will rebound in 2004. Lots of us in the trenches are tired of those childish forecasts.

LynnLynn July 24th, 2003
Report offensive content Reply

Have Gartner ever got anything right?
I normally listen to what they say then assume the opposite will happen. As such they have been invaluable.

They should either get someone who has some foresight or stop trying to predict the unpredictable.

Not only WILL there be a backlash, there already IS a back lash against exporting jobs. Unions are ALREADY putting pressure on governments to legislate against outsourcing.

I don’t really think it is an issue though – any company I know of that has implemented outsourcing has lived to regret it and have returned to developing in house.

AnonymousAnonymous July 24th, 2003
Report offensive content Reply

USA economists and marketers have pushed the world into globalization. Ostensibly, it provides the West with a higher standard of living through the acquision of cheap goods made in low-cost overseas centres. However, arguably, there is no improvement in the standard of living because the increased cost of housing during this period has erased any gains. Regardless of this, the price the West pays for globalization is the destruction of the local manufacturing industry, followed by the destruction of the local IT industry, followed by the destruction of all business processing. Anything requiring high labour content is at risk. Call centres, software development, service industries, back-end processing become relocated to wherever they are cheapest. Whats left behind are those at the top, and the industry of 'hot air' - local sales, retail, tourism, etc. Young people are consigned to part time/ temporary jobs as servers of McDonalds and caffe latte's. What is not fully appreciated is that for every job relocated overseas thats potentially one more person being on (local) social security instead of a paid job. It is naive to suggest that all these displaced people can be re-assigned to new industries. Each country needs to generate its own wealth, rather than being simply re-invented into a nation of consumers. You cant locally consume if you dont earn. You cant locally consume if your job is being done by someone in an overseas sweat shop at one tenth the price. Those who are pushing these agenda's will learn all too late that for every one lost local job thats one less consumer, and without consumer's THEIR jobs are ultimately at risk. There is a strong argument globalization brings nothing but pain - albeit it benefits China and some underdeveloped countries. But is this the price we are prepared to pay just so we can buy a few extra trinkets at half the price. The standard of living in the 1950's was supposedly lower than today - but are we better off ? Absolutely not! I would argue we need a lower average standard of living - and if we did, we would be a much happier, egalitarian, and compassionate country with greater employment for all - not just for those at the top. As for Gartner - and their ilk they are leading us into the unknown. They should be treated with the greatest suspicion.

Pete GrangerPete Granger July 24th, 2003
Report offensive content Reply

Outsourcing to India is NOT free trade. It may be free, but it is NOT trade. The first world is buying services from India, what is India buying from the first world? Little or nothing. When the UK car industry was outsourced to the Far East, nearly a century of intellectual capital was given away. Then UK now buys Toyota and Nissan cars etc.

Those who choose to ignore the lessons of history are destined to repeat them.

Gartner analysts suggest offshore outsourcing is now a "mega-trend". As with all “mega-trends” they tend to look very foolish with the benefit of hindsight. Gartner, wake-up!!

MeMe July 25th, 2003
Report offensive content Reply

Whilst I do not disagree with the concept of a business trying to operate in the most profitable manner, I do have concerns as to the level of quality and security we are going to have over applications developed offshore like this.

Traditionally it has been shown that when countries as a whole can offer products and/or services substantially cheaper than others, it is usally at the expense of quality.

Additionally, given the current social climate in the world, I'd wonder how much consideration is being given to ensuring that we are not going to end up with a series of application and such that may have purposely designed flaws and such that make those products a risk in certain times and situations.

Finally, I can't help but seeing the risk of modern technologically based sweatshops raising their heads if proliferation of this train of thought continues without adequate policing.

My two-bits worth only and not representative of my employer.

Robert KrautnerRobert Krautner July 25th, 2003
Report offensive content Reply

Booo Hoo are we supposed to feel sorry for them.
No way.
Companies who employ the foreign help(less) centres loose my support; when you have a problem and require help you dont need to struggle with the language problems as well as attempting to resolve the issues.

First they offer cut priced services, then to live up to promises the companies have to pressure the people who obviously cant take it.

Secondly and more importantly, they take jobs out of Australia.
Who in Oz is going to be able to work to pay taxes to fund the dole payments for the genuinely out of work IT personnel.?
Maybe the Indian Govt will send a few million $US our way as compensation.
More globalisation crap.

Thirdly they contribute little if anything to our country in the way of purchasing our exports.

As the song says "Dont cry for me ...."

You cant just have the easy bit guys you want to steal something you have to take lumps as well.

To quote from the original article "assuming false identities, copying foreign accents ..." is this not thieft and / or deception.
Ahh big business ethics, sorry there are none.

terry faketerry fake August 11th, 2003
Report offensive content Reply

My programming jobs are not coming back in two years' time, so I doubt that I shall be resigned to the situation by then. What is needed is what happened in America at the start of the Depression: a m****ive march on Washington, D.C.

Ian ElliottIan Elliott March 15th, 2005
Report offensive content Reply
Add your opinion

In order to post a comment, you need to be registered. (Sign In or register below)

Post your comment

ZDNet Australia Live

Our sister site @zdnetaustralia has relaunched http://www.zdnet.com.au/ looking good!

Love the new looks guys. Much easier to get to relevant stories and topics. The graph for tags is brill. It's a bit much for my poor ...

3 minutes ago by longtimelistener on Check out the new ZDNet Australia

Big up to my peeps at www.ZDNet.com.au (and www.ZDNetasia.com and www.ZDNet.com.uk). Loving the redesign!

How Exciting! @zdnetaustralia has relaunched and it looks slick and amazing!! Good job!! :) Check it out now http://www.zdnet.com.au/

Check out the new ZDNet Australia: ZDNet Australia today launched a new interactive platform, bringing content fro... http://bit.ly/dtp1Ip

@zdnetaustralia http://www.zdnet.com.au/membersh... returns a 404 (from header link)

http://www.zdnet.com.au/ launched their new design

.@zdnetaustralia has a new look - http://www.zdnet.com.au/. Well done team!

Dissecting a health care CRM failure: ZDNet (blog)
Most writing on IT failures focuses on either detailed technica... http://bit.ly/9pVBuK

Don't believe most of the crapola -- which is seemingly coming from those in the employ of the Wireless Radiation Industry. Cell phon...

1 hour ago by prd34 on Is your mobile phone killing you?

liking the new zdnet.com.au design

Checking out new look ZDnet.com.au

TCO: New research finds Macs in the enterprise easier, cheaper to manage than Windows PCs| ZDNet.com http://ow.ly/1nwrR

When you say something like the internet could collapse, you need to provide some reasoning behind it and prove you actually know how the...

4 hours ago by Rai on Internet infrastructure to collapse by 2010?

Redesign complet pour ZDNet UK et AU, Twitter au centre http://www.zdnet.co.uk/ http://www.zdnet.com.au/

@ThomasShaw linkedin connect should work again, thanks to @hobyho magic #zdnet

MS has confirmed that Windows Phone 7 won't have cut/copy/paste functionality: http://blogs.zdnet.com/hardware/... Disappointing.

@ThomasShaw we have a promo box at the bottom of the page and looking at a better way to implement itjobs on ZDNet

@thomasshaw thanks for the feedback, we are working on fixing the linkedin connect on zdnet.com.au

Microsoft IE9 developer preview with HTML5 support ready for download - ZDNET http://bit.ly/98sSk4

Thank you, bsteco! We're checking into the situation and will post developments here soon! -Brian Haverty, Editorial Director, ZDNet....

13 hours ago by Brian Haverty on Telstra reduces traffic light delays

*** PLEASE NOTE *** This article is factually untrue, and a formal Telstra retraction was requested at 6:30pm today. If ZDNet wishes to...

14 hours ago by bstec0 on Telstra reduces traffic light delays

It means being able to remotely fix an issue or better identify the cause of an issue. This results in less technicians required to driv...

15 hours ago by Anonymous on Telstra reduces traffic light delays

I still do not believe that an Australian Government would regulate the destruction of an Australian company by foul blackmail to the fi...

15 hours ago by Anonymous on Conroy loses Greens over NBN study

what has howrd got to do with it! My point is little nerdy Kev 07 fooled us all. In hind sight it was all hipe and no substance. climate...

15 hours ago by gd on Conroy loses Greens over NBN study

Why didn't Howard fix it the previous 10 years or however to long he was in.

15 hours ago by pop on Conroy loses Greens over NBN study

Mr conroy and therefore " I'm responsible" Mr Rudd are treating the taxpayers like idiots. They don't think we deserve to see the repo...

16 hours ago by gd on Conroy loses Greens over NBN study

Ieraci so meant that as a pun, I reckon.

16 hours ago by Anonymous on Telstra reduces traffic light delays

Haha.. may not be the best use of the term "truck rolls" when talking about traffic intersections! I think in this case it could have a ...

16 hours ago by Chris Anderson on Telstra reduces traffic light delays

All, I assume certain things. My boyfriend is aboriginal. I read this link, and as a white gay man I would never show him this site Th...

16 hours ago by Anonymous on Google removes Encyclopedia Dramatica link

haha, that was very funny, taking the **ss like that.

cause no one could be dumb enough to really believe it.

17 hours ago by pop on Fielding gives Telstra keys to split Bill

Not only has Conroy lost the greens, labor has lost me. Entirely because of Conroy. I will not sit by and vote for a man who wants to tre...

17 hours ago by tim on Conroy loses Greens over NBN study