Report: Effects of Offshore Outsourcing is Overrated

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In their efforts to find and break a Big Story, some journalists out there occasionally take a piece of news and try to blow it waaaaay out of proportion, sometimes at the expense of real news. Take the Bird Flu…please! (Cue rimshot.) This story dominated the headlines a few months ago and we still haven’t managed to shake it off entirely, despite the fact that it’s only killed a few dozen people—most of whom live in Southeast Asia—and hasn’t actually been transmitted between people. Meanwhile, nearly two-and-a-half million people died of AIDS in Africa last year (more than the entire population of all but three U.S. cities), and the continent currently has about 12 million children who’ve been orphaned by the disease, but I seldom saw much more than a few column inches of space devoted to this still-ongoing tragedy in the major daily newspapers.


One example of this in our own industry is outsourcing of the offshore variety. Despite the fact that this trend only affects a small percentage of a few particular vocations within the tech workforce, the media has generally characterized this phenomenon in truly exaggerated, bombastic fashion, making it sound as if the entire American IT industry is planning to take a slow boat to China. However, a new study conducted by the Association for Computing Machinery (ACM) gives lie to all of that hype.


According to the ACM report, the job loss attributable to offshoring each year ranges between 2 percent to 3 percent of the overall IT workforce, which isn’t insignificant, but it’s much smaller than the percentage of new tech openings created annually. Both of these trends—offshore outsourcing and rising job growth in-country—are expected to intensify in the next decade.


To its credit, ACM didn’t just deflate the inflated offshoring menace. It also covered a couple of real risks to the viability of the U.S. IT industry, namely education and research. To maintain its competitiveness, U.S. institutions need to invest heavily in technical training and instruction, and provide plenty of resources for the development of new and improved technologies. I can’t argue with that, and would only add that the IT workforce should stay focused on these and other issues that really count, and not dwell on some overstated threat.

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