A little while ago Vinnie Mirchandani suggested that Indian outsourcing growth in the US would likely stall. I think he might be close to the mark in Britain too.
I work for medium-sized company with a few thousand employess, 500 or so of whom are in the IT department, split between desktop, network and system support, and development. There’s been a major push to offshore, but I believe the anticipated cost savings have more to do with internal inefficiencies than with low wages in Mumbai. A friend of mine was made redundant, but had a better paying job lined up before leaving this one. I started looking around a couple of months ago, and had a much better job sorted out within weeks. I’ll tell you more about my new job when I start it.
So what’s going on? Well, I think there are a couple of key issues:
- I believe that the largest suppliers only want to take on high-value contracts. Some customers are too small to take on a major outsourcing contract.
- The supply side is tightening, so the cost difference between outsourced staff and full-time on-site employees is narrowing.
- Some companies want speed, knowledge and responsiveness that no amount of offshoring can provide, and so are in the market for a small number of the best people as full-time employees.
- Unless a company is big enough to open up its own shop offshore, it will still need technically capable people in its onshore staff.
- The UK economy, or at least the tech sector, is in good shape.
Naturally, it bothers me that there are people out there that would cheerfully do my job for one quarter of my salary. Someone tried to terrify me a while ago by pointing out that India was just the start, and when the Chinese starting providing offshoring services there would be people willing to work for one tenth of what I’m paid. He was right, but missed a few salient facts – that labour has to be organised at a profit, will never be as effective hour-for-hour as onshore labour, and has to compete in a booming domestic economy. I’m actually drinking the Koolaid when it comes to offshoring – I think offshoring will be good for pretty much everyone in the end.
Offshoring (outsourced or otherwise) is here until programmers the world over are paid the same rates. It’s becoming less popular over all, and less damaging in Britain when it does. I’m much less bothered by outsourcing than I used to be, and I think anyone that’s halfway decent should be able to stay in fairly lucrative employment for the forseeable future.