Offshore outsourcing is damaging IT job market

Although the IT workforce has grown by 1% in the US since the beginning of the year, the short-term outlook remains bleak,...

Although the IT workforce has grown by 1% in the US since the beginning of the year, the short-term outlook remains bleak, according to an updated report released today by the Information Technology Association of America (ITAA) and Dice, an online recruitment consultancy.

Telephone interviews conducted in July and August with hiring managers at 84 IT vendor companies and 216 non-IT companies revealed that "the original optimistic hiring forecast at the beginning of the year has been tempered by the economy", said Dice president and chief executive officer Scot Melland.

Many unemployed IT workers have claimed they have not been able to find work for months - even though they have sought-after skills such as C++, Java and Oracle. Some of them point the finger at companies hiring IT workers from abroad, but most blame the practice of offshore outsourcing.

Outsourcing not only leads to job cuts, it also allows corporations to avoid paying unemployment taxes when demand for labour slackens, said Norman Lane, president of Aztech Professional Services, a consulting and contracting firm. Lane contends that US companies engaging in offshore outsourcing should pay a levy "on every outsourced job to compensate US taxpayers".

ITAA President Harris said that he believes the economy has been the biggest culprit, even he acknowledged that offshore programming "is having an impact" on the US IT job market.

"So much work is going offshore, we're putting ourselves at a substantial [intellectual capital and security] risk," said Linda McInnis, an independent contractor and head of the hiring initiative at BostonSPIN, a group of 1,200 software professionals.

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