IT Employment

U.S. IT labor market stabilizes, hiring in India increases dramatically

Indian companies are hiring more employees than American firms in anticipation of an increased need for outsourcing.

Two research firms say that IT employment showed some signs of growing over the second half of 2009. The TechServe Alliance, an Alexandria, Va.-based industry group that represents IT services firms and their clients said IT employment last month grew by 6,400 jobs, or 0.2%.

Foote Partners LLC, a Vero Beach, Fla., research firm that studies IT salaries and employment trends, said its analysis of five job segments showed a net gain of 6,900 jobs last month in the U.S. in occupational categories of "management and technology consulting services" and "computer systems design and related services."

The firm predicts that hiring won't pick up in a big way for the IT industry until late in the year or more likely in 2011.

Things appear to be a little different in India. Indian IT services firms Wipro Ltd., Infosys Technologies Ltd., and Tata Consultancy Services added a total of 16,700 IT employees themselves last quarter and the number appears to be rising.

These companies are anticipating that offshore outsourcing will benefit from the economic recovery, even though IT budgets will be flat this year. The reason? U.S. firms, having been burned by recent layoffs, may be seeking the flexibility to add and subtract capacity as needed. The easiest way for them to do this is to turn to outsourcers, both onshore and offshore.

Even companies that experienced business problems due to outsourcing setups in the past, may be tempted to start off with them in 2010 at least until projects get off the ground.

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

20 comments
AV .
AV .

This country desperately needs jobs. They can have just as much flexibility by hiring temporary US workers and it would benefit our economy. Our Government needs to change the rules so that they benefit the American worker. How about a little protectionism? We elected these buffoons and look where we are as a country now. Unemployment and under-employment are the rule of the day. Add in under-valued and overworked for those of us that are employed. For companies to look offshore or hire foreign workers and illegals to fill business needs when so many American citizens are out of work is a disgrace. Where will the next generation of IT workers in America get their experience from if companies won't hire them? I've worked in IT since the mid 80's and watched it go from a lucrative profession worth pursuing to one that isn't. If I was starting out today, I don't think I would have been given the opportunity to even get started in IT. Even if companies start hiring this year or next, theres no guarantee it will be in this country unless our Government will make it advantageous for American's to be hired. AV etu

santeewelding
santeewelding

Retrench. You are trading easy shibboleths.

Dr Dij
Dr Dij

http://www.foreignpolicy.com/articles/2010/02/05/bricks_for_bread_and_milk kids are working on construction projects, perhaps 5 years old, for one meal a day. child labor laws are not enforced there.

BlueCollarCritic
BlueCollarCritic

@HypnoToad72 I'm not sure if your first line is your own statement or your re-posting of what someone else said. I can't find that mentioned in a apost before your sbut your comments after that first line make it sound like you are taking the opposite stance so I apolagize in advance if I get your intent wrong. Assuming you are making the statement: "Do they mind those horrid conditions as they are not fighting them?" The answer is: That statement is at bad iognorant and at worse outright disceptive. People in very poor conditions in other countries often do NOT complain because they fear worse or what will happen or they believe there is nothing they can do about it so they accept it. Its NOT because they don't find it as bad or close to as bad as we. Even here in the US were we are [supposedly] free, citizens often just sit back and make no effort to bring about change because they fear some form of reprisal from an out of control government. A government that is now so corrupt and arrogant that they often aren't denying the unconstitutional powers they have taken upon themselves.

HypnoToad72
HypnoToad72

And how much can the US interfere with other governments? Thanks to the supreme court, foreign corporations can now interfere with ours... at least during election periods, but with that door opened things could change badly over the next few years. Oh, the corporations certainly don't mind the lack of laws and regulations either... that is why 5 year olds are allowed to work for a half-bucket of gruel each day. That's immoral, unethical, you name it.

Dr Dij
Dr Dij

we seem to think we own all companies, but many simply do biz here and don't have hq here. the companies do biz around the world. why shouldn't they hire workers around the world? I don't believe however they should have the god given right to bring foreign workers into the US. the international hiring is a cost-cutting response to decades of over-spending by the US govt and massive inflation caused by out of control currency printing. The inflation is only hidden now by cheap chinese goods and inability of companies to raise prices on goods to reflect costs during this downturn. Also the govt bureaus manipulate figures (lie basically) to make inflation appear smaller than it really is. THe current crisis which bernanke 'fixed' was actually caused by him loosening the fiscal reigns in 1999 as precursor to y2k. This methods allows the govt to spend without borrowing or raising taxes, both of which are more visible. It allowed the previous presidents and congresses, senates to 'finan-sturbate', 'stimulating' themselves with dollars, and giving in to endless calls for govt handouts. Almost makes me believe in the 'mystical magical money fairy' that flits around spewing dollars it just printed. The fed is a one trick pony, it can only spray dollars out like a fire hose. Even raising interest rates doesn't get rid of the currency in circulation unless the fed buys it back and eliminates it which is highly unlikely in today's trillion dollar deficit days.

rwatters
rwatters

I didn't realize the Chair of the Department of Economics at Princeton yielded such power. Seems like something you'd need to be associated with the Federal Reserve System to do.

HypnoToad72
HypnoToad72

(a) why do big corporations keep asking for tax cuts, saying "tax cuts will create jobs"? (b) why do corporations lobby for preferential treatment? (c) why do they deserve tax cuts, tax incentives, "government subsidy"/"corporate welfare", or anything else? Those are the [i]entitlement programs[/i] that should be questioned. In China, government owns the corporations. In America, corporations own the government. (So who really owes on the national debt? Not the people who aren't being considered by government and paid-for corporate policies, surely?)

AV .
AV .

Truer words were never spoken. AV

AV .
AV .

How has offshore outsourcing benefited the average American worker? I can see how it has increased the pay and bonuses of the greedy CEO's and upper management. Sure, if an American company has a location in another country, it makes sense to hire people from that country for that location. Otherwise, it doesn't. Hiring cheap offshore labor is just a way for the greedy executives of some companies to make even more money. They are the ones that are short-sighted though because American consumers can't even afford cheap chinese goods if they have no jobs. AV

jk2001
jk2001

You're calling protectionism "stupid", and then you write three paragraphs about printing currency and inflation. (shakes head) Protectionism has always existed. The desire to reduce it has also existed. It's just one of those things -- if you want to develop an industry, you protect it.

Stu Marr
Stu Marr

More depressing news for US citizens. When is this administration, and more importantly, our corporate leadership going to develop a sense of morals and duty to this nation and its people? There are many arguments for changing policy around this issue. For me, one of the most compelling is actually not the moral argument, but an argument based on continuing US domination and prosperity. Which will lead to more growth, more jobs, and more money for the elite numbskulls that are behind current IT hiring strategies. Yes, I said numbskulls. Continuing to ignore qualified, educated, and hungry US citizens for technology jobs will do nothing but lead to a further decline in our historical leadership in the fields of science and technology. Which is bad for business in the long run. Period. Thoughts? Does anyone have a nuanced and complex argument for offshoring/outsourcing when the yardstick for a successful policy is more jobs for US citizens and an environment that will motivate the young people of this country to study engineering, science, and technology? Remember, the goal of US employment policy is more opportunity for US citizens and increasing the overall prosperity of this nation. At least that seems to be a good one for the purposes of this particular argument. Who doesn't want to reverse the decade long trend of stagnating wage growth, layoffs, and instability for the middle class?

BlueCollarCritic
BlueCollarCritic

The bottom line is this. 1) Corporations can only see as far as the next quarters Financials and will therefore make moves & changes based on how those affect these financials. 2) If something can be run, done, made or processed cheaper overseas then a corporation will move to do that overseas. 3) So long as those operating within the US have to comply with environmental restrictions, labor regulations, fees & licensing costs that those operating outside the US do NOT have to deal with or comply with then we will continue to see jobs and processes moved over seas. Every country with an excessively high amount of regulations and rules designed to drive up business costs will see a similar move of jobs and work to other countries where these excessive costs do not exist. 4) This movement of work from the US to outside the US will continue so long as #3 is true and until there are no more customers (or more accurately no more money in the hands of those consumers) left inside the US to sell goods to. 5) Once #4 runs its course the US will revert to a third world nation in which the very rich and powerful are at the top and all others are way down at the very bottom. India workers are NOT better than their American counterparts the simply can be rented by corporations for a lot less then US based workers and that is not simply the fault of the US worker demanding higher wages. In fact if a US worker wanted to be paid the same as their India counterpart there are just way to many other factors not controlled by the employee that are involved in the decision to move the job overseas. If you want o read more about what is going on and how Americas economy is being destroyed while its being spun that it?s the fault of a lazy American workforce then read about Mercantilism at Wikipedia. The practice of Mercantilism is how China is able to experience economic prosperity (even if it is mainly the government and not the citizens that are seeing the benefits) while America is seeing an economic down turn, one that will eventually make us into a China like country where the government controls all.

gsveeb
gsveeb

The companies (US-owned) that have hired IT consulting firms to run their IT shops are demanding that this be done at much lower costs. When a consulting firm competes for these contracts they are competing with all the other consulting companies, those that have offshore workers, and those that don't. Guess who can do the job at a lower cost? It's all about the bottom line ... and by the way, guess who else is demanding lower costs ... you ... every time you want that flat screen TV to come down to below $900 before you buy it.

HypnoToad72
HypnoToad72

can zip it. They can zip it as far back as 5~6 years ago, when the patterns were forming. And yet these same companies help themselves to tax cuts, citing the cuts will create jobs. (not in America, apparently.) President Obama needs to address every nuance of this. We have more unemployed IT people in the US than we do H1Bs. That is wrong and there is no way it can be successfully spun. We have the talent here, and we do more than blindly give out $700k loans to people making $15/hr, which noting many job offerings nowadays (that demand 5 years' experience in "Visual Studio 2008" no less) is still considered "too expensive". It would be too expensive, if the cost of living were closer to that of 1975 and not 2005. http://digg.com/tech_news/H1_B_Workers_In_U_S_Outnumber_Unemployed_Techies

jck
jck

only for their bottom line. As soon as the administration and Congress makes law that forces tax incentives for corporations to be percentage-of-domestic-workforce-based, then corporations will hire more people to make sure their tax breaks come in wholly as needed. Otherwise, Corporate America is content with watching the USA become the new economic slum of the global village.

Dr Dij
Dr Dij

since we seem to think the US is the home to all worldwide corporations. They are multi-national. they do biz around the world, why shouldn't they hire people around the world?

timfle
timfle

Having been the victim of the above mentioned corporate scam - (huge health insurance company based in Louisville KY - I will be PC and not mention their name)- I feel qualified to comment. When I was hired i was assured my position was long term since it dealt with Medicare. After 4.5 months I was informed the position was being offshore outsourced. Apparently in the corporate ethics world (an oxymoron) - it is OK to lie when it serves the need of the "the company". I trained the replacements. During the health care reform debate - the insurance companies all cried about the "jobs" that would be lost. What a joke - the "jobs" would be the overpaid, mostly incompetent management. Nice to see how YOUR tax dollars are at work to promote corporate greed.

jk2001
jk2001

It's totally okay for companies to hire in the countries in which they do business. In fact, it's correct. However, what's happening in some firms is that the existing staff are told to train their replacements. Then the existing staff are fired. That's wrong. It's immoral. Supposed I did that do you - you train the next worker, and then I fire you because this new person's paid less. Suppose this worker comes from another country, gets trained, then returns home to work in an entire department that's been moved overseas. That's the story of American business. Sending the jobs overseas. Rather than compete with imports, just import the entire operation, while keeping the finances in the US. Do it enough, and banker salaries rise, people get too self-confident about their fiscal prowess.... and then you end up in the craphole we're in today. Way to go, globalization!

HypnoToad72
HypnoToad72

never mind buying their increasingly shoddy products (maybe the American workers are engaging in 'passive-aggressive tactics' when training their replacements too)... http://www.google.com/search?q=americans+train+replacements&btnG=Google+Search Maybe they'll eat each other. After all: * Small bookstores thrived. * Borders came in. * Small bookstores died out. * Amazon.com comes in. * Borders now closing stores too http://www.huffingtonpost.com/2009/11/08/walmart-amazon-target-in-_n_349918.html Or wal-mart: http://www.thirdworldtraveler.com/Corporate_Welfare/WalMart_Welfare.html http://www.alternet.org/blogs/peek/53177/ http://www.progress.org/2005/tcs179.htm http://www.larouchepub.com/other/2003/3045walmart_iowa.html * Walmart gets corporate subsidy from the government. WELFARE. And they needn't a penny. * They pay so little, their employees have to get welfare. (and when managers tell their workers how great they are for bringing business, don't ask if the workers get a cut of the share of the HARD WORK they put in.) * walmart comes in with artificial prices (see 'welfare' above for 2 reasons how) and drives out other businesses * as walmart destroys livelihoods, people can no longer spend so walmart leaves, claiming the area isn't profitable and what's left is tumbleweeds