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3.3 Million U. S. services Jobs To Go Offshore
... U.S. imports of business, professional, and technical services associated with off-shore outsourcing rose from $21.2 billion in 1997 to approximately $37.5 billion in 2002, an increase of 77 percent. The most widely cited estimate of the scale of white-collar off-shore outsourcing is a 2002 Forrester projection that "over the next 15 years, 3.3 million U.S. services industry jobs and $136 billion in wages will move off-shore" [9]. ...
... The total number of available positions increased almost 50% since April 2002 if Monster.com is a reasonable indicator [17]. The U.S. Bureau of Labor Statistics forecasts a 20%-50% job growth in all computing specialties by 2012, except for computer operations which is declining and programming which is flat [9]. It is widely reported that finding people to fill the growing number of IT jobs will soon be more difficult than ever. ...
... The year is divided into nine four-week periods. 9 The authors believe that service sciences have much to learn from medical school curriculums. In that spirit, the following is an adaptation of the Yale Medical School curriculum to what we call the School of Artificial Systems and Service Sciences, which would educate and train management practitioners. ...
Enrollment in computer programming courses has plummeted in the past decade. Facing a similar situation in the 1960s, the mathematics community responded by inventing the "new math." Unfortunately the new math failed because it was too abstract for students to see connections with their lives, and because math teachers were not adequately prepared. Many of today's computing related degree programs are in danger of failing for similar reasons. This paper argues that, besides off-shoring; there may be other less obvious reasons for the drop in enrollment. These reasons include curriculums that overemphasize functional programming, and under-emphasize ethics and practical service internships. This paper further argues that modern curriculums for the fields of Computer Science, Information Systems, Information Technology, and Software Engineering could all be improved by viewing them as sub-specialties of the newly emerging discipline of Service Sciences. The paper concludes by sketching a basic curriculum for a hypothetical new program we call the School of Artificial Systems and Service Sciences. It is an extension of the philosophical approach used at Yale Medical School.
... 47 Let us now turn towards the economic interpretation of these interaction effects, in which we focus on the results in column (3). 48 A common colonial past increases the expected share of offshoring (see column (1)). The positive and significant interaction term suggests that this effect is even stronger for those services with a relatively high degree of coordination requirements. ...
... Note that the interaction terms with NAFTA and common colonial past are statistically significant in each of these steps. 48 Unfortunately, the zero-inflated Poisson regression cannot yet be extended to a fixed-effect estimator (see Winkelmann 2008, p. 227). However, the Poisson pseudo-maximum likelihood estimator can be extended to a fixed-effect Poisson pseudo-maximum likelihood estimator (see Westerlund and Wilhelmson 2006). ...
This work offers new insights into the determinants of service offshoring across countries and across service industries. Combining different data sources over the 2006-2009 period, I find that certain country characteristics affect offshoring costs for all services, while the effects of other characteristics depend on the coordination requirements of the respective service industry. The results from a zero-inflated Poisson pseudomaximum likelihood estimation indicate that the effects of a membership in NAFTA, and a common colonial past on service offshoring patterns depend on the task content of the services. These results are robust to the control for unobservable country-level heterogeneity. The quality of legal institutions, a common legal origin, geographic distance, and time zone differences influence offshoring patterns identically across all service industries. --
... It is this aspect that has led to fears in the industrialized countries that jobs previously held in the North will be " re-located " to developing and transition countries. Market research companies have fuelled these fears by presenting alarming headline statistics that predict massive job losses at the expense of workers in developed countries (McCarthy et al. 2002, McCarthy 2004 and Parker 2004). Offshoring has thus been hotly debated in the United States but also in Europe. 2 ...
... An even greater impact is predicted in the United States, with an estimate of 3.3 million jobs lost during the same period. The claim was first made by the consultancy in 2002, and then was revised, slightly upwards, two years later (McCarthy 2002 and). Others believe that this figure is still 'conservative' and estimate that in the United States alone some 14 million jobs are 'at risk' as a result of offshoring (Bardhan and Kroll, 2003). ...
... Nearly one third of all offshore outsourcing programs are related to administrative functions of finance, legal and recruitment. However the more sensitive management functions are not commonly outsourced (McCarthy 2002). ...
Offshore outsourcing is a prevailing deterrent in the business economic front. Given the competitive pressures put on firms, outsourcing is an elemental practice that can enable cost reduction measures and raise operating efficiencies; or otherwise access resources and competencies by simply choosing how and where to capture gains. This learning mechanism enhances organisation agility across geographical and cultural regions in a practice described unique to cross border operation strategic challenges, regardless of organisation age and size. Within such context, better prospects are expected of organisations with diverse experience, typically serving very broad consumer markets. Competitiveness is nurtured from the right mixture of organisation culture and tacit knowledge; home grown expertise and leadership insight that creates a highly sophisticated value supply chain with a built-in complexity on organisation dynamics that influences the ability of the decision maker over cost implementation. Denmark outsourcing activities are far more aggressive than European counterparts, with a small liberalised state economy and SMEs representing a greater proportion. Given its narrow national consumer base compensated through export oriented policy mechanisms; any structural changes in the economy must tantamount an increased role for the SMEs. In contrast of other European countries, employment protection is weak and Danish firms can fine-tune employment schemes with relative ease, even when more than three quarters of the whole labour force are union members. This peculiar labour market model has resulted to high turnover rates of an average tenure of about eight years. A Danish worker is remunerated with relatively generous unemployment benefits yet sternly reinforced through monitoring and sanction-otherwise known as the flexicurity labour model characterised with extreme wage dispersion particularly in the Danish labour market. This study finds that there are no inhibiting elements on the future growth and development of the Danish SME. Firms engaged in offshore outsourcing see better prospects in those markets, with the leeway of establishing or increasing operations in those specific regions. Strategic alliances and closer relations with providers that seemingly blur the boundaries of the enterprise, has positive impact on the worker capability and wages in Denmark. For the future Danish SME has right disposition and ability to influence change.
... Much of the early effort has come from management consulting firms, most notably McKinsey Consulting 21 and Forrester Research. 22 McKinsey concluded that the United States gets more than it gives from offshoring, due primarily to the new revenue it generates that flows back in the Nation. 23 Forrester provided the most widely cited job impact number from offshoring-3.3 million jobs lost by 2015. ...
Employment trends by industry and occupation suggest that offshoring in the information technology sector occurs, but not to a great extent.
... For instance, the number of offshore service workers grew from less than 35,000 worldwide in 1994 to over 350,000 in India alone in 2003 (Metters and Verma, 2008). This growing trend is expected to continue with estimates that between the years 2000 and 2015, over 3 million white-collar jobs worth more than US$150 billion annually will be moved from the United States to offshore locations (McCarthy et al., 2002). In addition to its overall magnitude, offshoring is also growing in terms of the variety of functions that firms relocate abroad, as firms start to offshore functions rich in product-related knowledge such as research and development (R&D) (Lewin and Peeters, 2006). ...
This study attempts to increase the understanding of how offshoring influences the introduction of new products and services. Focusing on the offshoring of those business functions that provide direct knowledge inputs for innovation (i.e., production, R&D, and engineering), we propose that offshoring has an inverted U-shaped influence on firm innovativeness. Additionally, we provide an upper echelon contingency perspective by considering the moderating role of two top management team (TMT) attributes (i.e., informational diversity and shared vision). Using a cross-industry sample with lagged data, we find that offshoring has an inverted U-shaped influence on firm innovativeness and that this relationship is steeper in firms with high TMT informational diversity and in firms with low TMT shared vision. Copyright (C) 2012 John Wiley & Sons, Ltd.
... There are a few prominent projections, advanced mostly by consulting firms. An early estimate of the likely scale of future job losses due to movement of jobs off shore is Forrester Research's "3.3 Million US Services Jobs To Go Offshore" (McCarthy (2002)). 1 Other estimates include: Deloitte Research estimates that by 2008 the world's largest financial service companies will have relocated up to two million jobs to low-cost offshore countries; Gartner Research predicts that by the end of 2004 10% of IT jobs at US IT companies and 5% of IT-jobs at non-IT companies will have moved offshore; another Gartner Research survey revealed that 300 of the Fortune 500 companies today do business with Indian IT services companies. ...
This chapter discusses services offshoring, which refers to the migration of jobs across national borders, mostly from rich countries to poor ones, with imported products and activities flowing back to the United States. A measure of tradability is described, built from common notions of job characteristics related to offshorability. A selection of tradable occupations do indeed have characteristics of offshorability, including Internet-enabled, high-information content, no-face-to-face customer contact. The calculated index of offshorability offers strong potential for understanding jobs (tasks) at risk. The two measures of tradability and offshorability offer a combined potential to do the same. The chapter concludes with the expectation that, as technology and policy allow for more trade in these activities, the United States should gain world market share in these activities, not lose it.
... The other prominent projections have been advanced by consulting firms. The dominant and most widely quoted projection of future job losses is Forrester Research's "3.3 Million US Services Jobs to Go Offshore" (McCarthy 2002). Jensen and Kletzer (2005) cite a variety of estimates of the jobs at risk of delocation. ...
... Over the longer term, it is difficult to find a relationship between the different episodes of offshoring and the number of jobs in the United States. Between 1960 and2002, in comparison to other advanced countries, the United States moved from below average in the share of its working-age population holding jobs to having the highest proportion of its working-age population with jobs. ...
... also estimates that by 2008 services offshoring will provide employment to approx. 4.1 million people, representing 1.1 % of total employment in services in developed countries and according to the Forrester research, 3.3 million US business process jobs worth $136 billion in wages will go offshore by 2015(McCarthy et al., 2002. Clearly, the international outsourcing of IT services has grown rapidly and is predicted to continue its growth trajectory in the future. ...
... 8 A.T. Kearney Inc. (2004) in a recent report reveals that India is the most attractive location in the world for BPO on the basis of people skills and availability, but the retention rate of employees is one of the lowest in the world. The major industry players in India 9 According to the McKinsey Global Institute (MAI) study Foreign Direct Investment in India has led to the creation of a more than $10 billion a year software and outsourcing industry which employs 500,000 people, who perform white-collar jobs for foreign company. Projections suggest that it will employ 2,000,000 people by 2008. ...
Recently, offshore-outsourcing of U.S. jobs in general and particularly to India has drawn considerable attention from various quarters in the U.S. A combination of factors have propelled this issue to the forefront: ominous headlines; downsizing of corporate labor force; huge trade deficits, increased global competition; poor job growth in a healthy economy; loss of white-collar and professional jobs, etc. The trend of jobs outsourced to India is projected to be sharply upward in the near future. India has clearly benefited from the influx of new jobs. It has also brought some cultural changes in the younger generation in India not well received by the local communities. However, the overall cultural understanding between India and the U.S. has certainly improved. The study finds that the U.S. businesses have many compelling reasons in outsourcing jobs to India: cost savings due to wage differentials; decreasing need for capital investment; availability of educated and skilled workforce, etc. The offshore-outsourcing also has many disadvantages: loss of security; increased dependency; huge startup and communication costs; inadequate protection of intellectual property; poor infrastructure; different legal systems; high levels of bureaucracy and corruption, etc. As the economic theories suggest, the authors find that, given the current competitive global business environment, offshore-outsourcing is an essential part of sound business decisions that U.S. corporations need to make to remain economically viable in the long-run. The short-run problem of displaced workers, although highly important, should be addressed in ways other than imposing trade restrictions, or isolating U.S. from world competition.
... Research Inc.'s findings (McCarthy 2002, Parker 2004, which identify the occupations heavily present in these sectors as the most likely to be affected by offshoring. ...
... Four hundred thousand well-paying service jobs have been outsourced in the last four years alone. Forrester Research estimates that over the next 15 years, 3.3 million U.S. service industry jobs and $136 billion in wages will move offshore (McCarthy, 2002). Nearly 40% of the companies in a recent survey said that they eliminated positions and terminated employees as a result of their decision to outsource (Swoyer, 2004). ...
As the pace of outsourcing has continued to accelerate, so too has interest in the topic on the part of researchers, practitioners, and policy makers. Despite this increasing interest, there remains a great deal of uncertainty surrounding the outsourcing phenomenon. In particular, its effects on organizations and nations remain the subject of intense debate. In this commentary, we address this topic by discussing what constitutes outsourcing, public policy concerns about outsourcing, governmental responses to outsourcing, and a variety of firm-level issues related to outsourcing. © 2005 Wiley Periodicals, Inc.
... The outsourcing and offshoring of services in the US is an important and growing phenomenon that has recently attracted widespread attention. At present, widely varying projections of the number of jobs " at risk " have been presented, mostly by consulting firms (e.g., McCarthy 2002). Ultimately, these estimates turn on the question of whether and when IT services are tradable. ...
We examine the question of which services are tradable within a concrete setting: the outsourcing of IT services across a broad cross-section of establishments in the US. If markets for IT services are local, then we should expect increases in local supply should increase the likelihood of outsourcing by lowering the cost of outsourcing. If markets are not local then local supply will not affect outsourcing demand. We analyze the outsourcing decisions of a large sample of 99,775 establishments in 2002 and 2004, for two types of IT services: programming and design and hosting. Programming and design projects require communication of detailed user requirements whereas hosting requires less coordination between client and service provider than programming and design. Our empirical results bear out this intuition: The probability of outsourcing programming and design is increasing in the local supply of outsourcing, and this sensitivity to local supply conditions has been increasing over time. This suggests there is some non-tradable or "local" component to programming and design services that cannot be easily removed. In contrast, the decision to outsource hosting is sensitive to local supply only for a minority of firms for which network uptime and security concerns are particularly acute.
... Research Inc.'s findings (McCarthy 2002, Parker 2004, which identify the occupations heavily present in these sectors as the most likely to be affected by offshoring. ...
Based on longitudinal case studies of offshoring of advanced IT and engineering services from Danish firms to Indian firms, this paper explores organizational learning that occurs over time in both home and host firms and uses learning as a measure of the firm impact of advanced services offshoring. The findings are consistent with the theoretical view that advanced services offshoring must be understood as an antecedent for strategic business development and organizational change in both home and host firms. The study shows that when offshoring partnerships mature and firms gain experience, learning in both home and host firms evolves over time and differs in many cases from their initial objectives and expectations. In some of the Danish firms engaging in offshoring even ignites a process of strategic transformation. Both Danish and Indian firms use the input from their offshoring partnership to upgrade their organizations and business processes.
... Now, Americans are faced with outsourcing other value chain links, namely research and development and customer service. According to an often-quoted Forrester Research report, by the year 2015, more than 3 million white collar service sector and high technology jobs will leave the US (McCarthy, Dash, Liddell, Ross-Ferrusi, & Tempkin, 2002). Much research has focused on the effects of country of origin. ...
This study investigates the effects of country-of-design/country-of-assembly combinations on consumers' evaluative beliefs about and attitudes toward buying automobiles. The effects are compared across groups of consumers differing with respect to levels of consumer ethnocentrism. Two design countries and two assembly countries (Japan or US) were considered, yielding four possible design-country/assembly-country combinations. The results suggest that manufacturing products in the country in which they are sold not only provides closer access to the market, but also allows multinational manufacturers to 'blur the boundaries' regarding a potentially sensitive country-of-origin issue among highly ethnocentric consumers. At the same time, they can leverage their country-brand images to appeal to those customers who recognize a particular country's ability to design high quality cars, regardless of their country of assembly.
... On the other hand, all other sectors of the EU economy have hardly been affected by offshoring. This finding that EU offshoring is concentrated in manufacturing, financial services, and ICT is consistent with Jensen and Kletzer's findings (2005) that these sectors are generally tradable, as well as with Forrester Research Inc.'s findings (McCarthy 2002, Parker 2004, which identify the occupations heavily present in these sectors as the most likely to be affected by offshoring. ...
Based on a large Danish survey of companies in tradable goods and services sectors, this working paper presents the results of offshoring and its impact on jobs, adding new perspectives to the globalization debate. Globalization entails a cross-border flow of jobs, but contrary to the mainstream media portrayal of globalization, it is not a one-way but a two-way street. In 2002–05 more jobs were created as a result of offshoring of activities into eastern Denmark from companies outside Denmark (i.e., inshored to Denmark) than were eliminated due to offshoring from companies in the Danish region. Overall, the employment effects of both offshoring and inshoring were found to be limited to less than 1 percent of all jobs either lost to offshoring or gained via inshoring. For Denmark, the worries in purely numerical terms regarding the employment effects of globalization seem overly alarmist. However, the trends revealed in the study do pose challenges for low-skilled workers—the group most negatively affected—and for highly skilled specialists, who face pressure to constantly upgrade their skills. Policy implications can be drawn in view of our results to ensure that labor markets are able to meet the demands of globalizing firms.
... In this paper, I construct the measure of international job outsourcing activity using information from Forrester Research Inc. (McCarthy et al (2002)), one of the most authoritative and widely cited proprietary reports. The report predicts that a cumulative 830,000 white-collar jobs will be outsourced from the U.S. offshore by 2005, and by 2015 the number is expected to rise to 3.4 million (Hilsenrath (2004)). ...
The study is the first to examine empirically the impact of the new wave of global job outsourcing on skill-specific patterns of involuntary unemployment in the U.S. using the latest individual-level data. The estimates from a probit model show that, so far, global human-capital outsourcing has not shifted the risk of unemployment from lower-skilled to higher-skilled American workers. Overall, the probability of involuntary unemployment is negatively related with the worker’s level of education. For the outsourceable occupations, however, high-skilled workers are currently at a greater risk of unemployment than those with lower skills.
We investigate the different impacts of foreign direct investment (FDI) on employment elasticity with China's firm level data from 1998 to 2007. Our analysis shows that the inclusion of FDI does significantly affect firms' employment elasticity when facing wage, capital and output shocks. These effects vary dramatically across industries with different factor intensities and export status. Specifically, we find that non-exporters with FDI tend to increase employment elasticity more than exporters when wage, capital input or output changes. However, FDI firms that are engaging in labor-intensive production tend to have larger output and capital input elasticity of employment while smaller wage elasticity of employment. Our findings help to explain the contradicting results in existing literature and provide important references for China's policy makers to design proper industry policies towards FDI.
Introduction The virtualization of work has increased the opportunities for global organizational collaboration several fold. Organizations today rely on supply chains that criss-cross the globe in the creation of both manufactured goods and services. Several large emerging countries such as China, India, and Russia, have embraced open trade and investment policies adding billions of workers to the global talent pool with implications for employment in both developed and developing nations. Global outsourcing and offshoring have exploded, enabled by new technologies in information processing, communication, and transportation. As Blinder (1988) noted, it is important to consider the dynamics of employment resulting from changes in international trade policies. For just as in the 1980s, when blue-collar workers began to see jobs shift to locations in Mexico and South Korea, today, white-collar service jobs are moving to countries like the Philippines and Poland. Moreover, changes in trade policies do not have the same effect on all occupations and sectors (Cohen and Zaidi, 2002). Some view these changes in the labor market as more harmful to national economies than manufacturing offshoring, because of the high-value jobs involved. This chapter examines business, professional, and technical service (BPTS) and information technology (IT) service exports to the United States from a group of twenty-nine countries in a search for the country-level determinants of trade in these high value-added services.
Outsourcing of jobs, particularly the growing practice of sending the jobs of U.S. knowledge and communication sector workers to other countries, has become a significant issue in academic, policy and media circles. The paper begins by defining knowledge workers and summarising debates about their significance dating from the 1950s. Next it considers prevailing views about the problem which centre on the fear of massive job loss to low-wage nations like India and China and prevailing solutions offered by labour-stop outsourcing wherever possible, and by business-outsourcing can only be curtailed when business and labour grow smarter. Each of these views conveys an essential truth but each deals only with symptoms of a significant transformation in the international division of labour. Understanding this transformation, and the role of information and communication technologies, leads us to consider key dimensions in the complexity of outsourcing: developed nations like Canada and Ireland have benefited as recipients of outsourced jobs; less developed nations like India are not just recipients of outsourced jobs, they are beginning to lead the process; in spite of "end of geography" promises, place matters and culture counts; and, finally, resistance takes a multiplicity of forms.
This study examines key issues and effects of innovation management on a fast-growing area of knowledge-intensive global business services – IT outsourcing and offshoring. An exploratory study of Indian companies providing complex pro-cess oriented offshore IT services to their global customers was carried out. The analysis of the data related to the service provider side shows that innovation management is strongly driven by the management and top-clients and results in development and innovation of business processes and in establishing a strate-gic partnership with the client organization. Key findings are that strategic man-agement play a significant role and that continues improvement of relationship management practices, especially building up specific firm capabilities, accom-plishes firm performance.
This paper analyses the change (1995-2009) and its reasons (Berman Decomposition 1993) of employment structure in China's industrial sectors. Then we test the impact of offshoring on the employment structure based on China’s panel data as a whole and by sector. The conclusion shows that China's overall employment structure in industrial sectors has been improving. The increase of skilled labour in the technology-intensive sectors obviously optimizes overall employment structure, while labour/resource-intensive and primary production sectors are both lag behind. Comparing with inter-industry change, labour-saving technology progress or rise in intra-industry productivity should be the main drivers of employment structure optimization. Significant sector differences in the impact of material offshoring and narrow material offshoring on employment structure exist, and service offshoring appears to promotes employment structure overall. Accordingly, we propose policy suggestions about the development of China's employment market in response to the new international division of labour.
‘We believe that the central challenge we face today is to ensure that globalization becomes a positive force for all the world’s people’, reads the fifth paragraph of the United Nations Millennium Declaration (United Nations 2000). Although globalization reflects technological advances and economic forces, it can be moulded by society and, particularly, by democratic political institutions. In fact, the form that globalization has been taking has been largely determined by explicit policy decisions. In this sense, the most disturbing aspect has been the uneven and unbalanced character of the current phase of globalization and of the international policy agenda that accompanies it. The latter has both reproduced the traditional asymmetries in the world economy and created new ones. There are four issues that have dominated the economic agenda: free trade, intellectual property rights, investment protection, and financial and capital account liberalization. In the latter case, the condition that it should be subject to strong regulatory frameworks has been superimposed as a result of recent crises, particularly in the developing world by the 1997 Asian financial crisis and in the industrial world by the most recent 2008–9 global financial crisis. Moreover, in the area of international trade, liberalization is incomplete and asymmetric: various goods of special interest to developing countries are subject to the highest levels of protection and, in the case of agriculture, to subsidies in industrialized countries.
Context – Offshore software development outsourcing (OSDO) is a modern business strategy for developing high quality software at low-wage countries at reduced cost. Outsourcing is a contract based association between vendor and client organization, where a client organization contracts-out with vendor organization for software development work to be provided by vendor organization in return for remuneration. Appropriate management of the OSDO contract plays an important role in the success of outsourced projects. Objective -The objective of this protocol is to identify different critical success factors (CSFs) and critical barriers (CBs) that are considered critical for successful management and execution of the outsourcing contract in different stages of the contract i.e. pre-contract, during the contract and post-contract. Method – Systematic Literature Review (SLR) will be used for the identification of the aforementioned factors. SLR is based on a structured protocol, and is therefore, different from ordinary review. SLR give more prescribed and less biased result from the ordinary literature review. Expected Outcome – We have developed the SLR protocol and are currently in process of its implementation. The expected outcomes of this review will be the identification of critical success factors (CSFs) and critical barriers (CBs) to be addressed by vendor organizations for appropriate management of OSDO contract. The ultimate outcome of the research is to develop Outsourcing Contract Management Model (OCMM).
CONTEXT – Offshore software development outsourcing has become an important business strategy and its growth rate is rising rapidly. OBJECTIVE -The objective of this research project is to develop outsourcing contract management model to assist vendor organisations in successful management and execution of the outsourcing contract at different stages of the contract. i.e. pre-contract, during the contract and post contract. METHOD – Various type of data will be collected, first about the factors that having a positive and negative impact for proper management of the outsourcing contract. Second about practices for the proper implementation of these factors. EXPECTED OUTCOME – The outcome of this project will be an outsourcing contract management model (OCMM) that will assist vendor organisations for successful management and execution of the outsourcing contract at different stages. i.e. pre-contract, during-contract and post-contract.
This article assesses the employment situation in the U.S. information technology (IT) industry, examining recent job growth trends and the underlying factors, such as flexible staffing arrangements and offshore outsourcing, which are responsible for falling IT employment. The IT industry, which was at the center of the 1990s boom, was caught in the midst of the 2001 recession and the ensuing jobless recovery. Employment has fallen dramatically between March 2001 and March 2004 and the IT industry lost approximately 403,000 jobs, more than half of which were eliminated during the economic recovery. While cyclical factors are partially responsible for these employment declines, underlying weaknesses in IT labor markets remain as U.S. corporations continue to pursue restructuring tactics aimed at achieving immediate reductions in labor costs.
Purpose
Since the mid‐1990s, offshore production has become increasingly important in white‐collar, service sector activities in the US economy. This development coincided with a stagnant gender wage gap in the service sector and a slowdown in the narrowing of the overall US gender wage gap over this period. This paper aims to categorize white‐collar service sector occupations into two groups based on whether an occupation is at risk of being offshored and to assess the relative contribution of these two groupings, through their employment and wages, to the trends in the gender wage gap within the service sector and the US economy between 1995 and 2005.
Design/methodology/approach
Standard occupational decomposition methods are applied to Current Population Survey and Displaced Workers Survey data.
Findings
The findings show that in occupations at risk of being offshored, low‐wage women's employment declined, leading to an artificial increase in the average wage of the remaining women thereby narrowing the gender wage gap. This improvement in the gender wage gap was offset by the relative growth of high‐wage male employment in at‐risk occupations and the widening of the gender wage gap within not‐at‐risk occupations.
Originality/value
These findings contribute to the growing literature on the causes of the stagnation of the US gender wage gap in the 1990s.
CONTEXT – Offshore software development outsourcing is a contractual business of high quality software production with significant cost-saving.
OBJECTIVE – The objective of this research paper is to analyse the factors that influence software outsourcing clients in the selection of offshore software outsourcing vendors.
METHOD – We have performed questionnaire surveys with 53 experts. We asked the participants to rank each success factor on a five-point scale to determine the perceived importance of each success factor. Our survey included success factors identified in the previous findings of systematic literature review study.
RESULTS – Our study reveal both cost-saving and appropriate infrastructure as the most influential factors in the selection of outsourcing vendors. Our results also indicate that appropriate infrastructure, cost-saving and efficient project management are common success factors across different groups of practitioners.
CONCLUSIONS – Cost-saving and appropriate infrastructure should be considered as the prime factors in the selection process of software development outsourcing vendors.
We examine the question of which services are tradable within a concrete setting: the outsourcing of IT services across a broad cross-section of establishments in the US. We analyze outsourcing decisions from 52,191 establishments with over 100 employees at the end of 2002, for two types of IT services: programming and design and hosting. Supply of programming and design services are more sensitive to increases in local market demand than are providers of hosting services, and the probability of outsourcing programming and design is increasing the local supply of outsourcing, but the outsourcing of hosting is not. This suggests that hosting services are more tradable than programming and design, and there is some irreducible non-tradable or "local" component to programming and design services
We examine the question of which services are tradable within a concrete setting: the outsourcing of information technology (IT) services across a broad cross-section of establishments in the United States. If markets for IT services are local, then we should expect increases in local supply would increase the likelihood of outsourcing by lowering the cost of outsourcing. If markets are not local, then local supply will not affect outsourcing demand. We analyze the outsourcing decisions of a large sample of 99,775 establishments in 2002 and 2004, for two types of IT services-programming and design and hosting. Programming and design projects require communication of detailed user requirements whereas hosting requires less coordination between client and service provider than programming and design. Our empirical results bear out this intuition: the probability of outsourcing programming and design is increasing in the local supply of outsourcing, and this sensitivity to local supply conditions has been increasing over time. This suggests there is some nontradable or "local" component to programming and design services that cannot be easily removed. In contrast, the decision to outsource hosting is sensitive to local supply only for firms for which network uptime and security concerns are particularly acute.
When Edgster Dijkstra wrote his paper Go To Statements Considered Harmful , programmers were lost in millions of lines of spaghetti code. Now programmers have lost their way again---this time amidst thousands of unread resumes. Between 2000 and 2004, the percentage of incoming computer science freshmen fell by 60%. Drop rates of 30--50% are common. Results are similar for the other computing related fields including Information Systems, Software Engineering, and Information Technology. Many of these degree programs, which H.A. Simon referred to collectively as the Artificial Sciences, have failed or are about to fail.
This loss of student interest in artificial sciences has been blamed in part on the impression that they require extraordinary programming skills. Computing journals perpetuate these notions. For example, in capstone (senior level) computer science courses, students should design and code a 'real world' application. This article is an opposing viewpoint.
This paper examines India's role in services outsourcing within Asia. It provides a brief overview of the global as well as Indian services outsourcing industry. The core section examines India's relationship with other Asian countries such as China, the Philippines, Vietnam, and Malaysia in service outsourcing. It examines the extent to which these countries pose a competitive challenge to India and concludes that at this time, India is far ahead although it is likely to face growing competition as its costs rise. The paper highlights the need to move beyond this comparative paradigm and to examine the complementary and collaborative opportunities that exist between India and other Asian countries in services outsourcing. It concludes that there is considerable scope for such synergies and that India and other Asian countries can form different parts of a larger regional or global delivery model. Regional and bilateral agreements within Asia can also facilitate this process.
[eng] We present a two-sided search model where agents differ by their human capital endowment and where workers of different skill are imperfect substitutes. Then the labor market endogenously divides into disjoint segments and wage inequality will depend on the degree of labor market segmentation. The most important results are : 1) overall wage inequality as well as within-group and between-group inequalities increase with relative human capital inequality ; 2) within-group wage inequality decreases while between-group and overall wage inequalities increase with the efficiency of the search process ; 3) within-group, between-group and overall wage inequalities increase with technological changes. [fre] Immigration et justice sociale. . Cet article est d�di� � la m�moire d'Yves Younes qui nous a quitt�s en mai 1996, et dont les derni�res r�flexions sur l'importance du ph�nom�ne migratoire dans les �tats-Unis des ann�es 1980-1790 m'ont beaucoup influenc�.. L'ouverture des fronti�res entre le Nord et le Sud peut-elle se retourner contre les plus d�favoris�s du monde, c'est-�-dire les non-qualifi�s du Sud ?. Avec deux facteurs de production, les migrations Sud-Nord b�n�ficient tou�jours aux moins qualifi�s du Sud, puisqu'ils y sont le facteur le plus abondant. Mais avec trois facteurs de production (trois niveaux de qualifications, ou deux niveaux et un facteur capital imparfaitement mobile), l'ouverture des fronti�res peut conduire � une baisse du salaire des moins qualifi�s du Sud si leur compl�mentarit� avec le travail tr�s qualifi� ou le capital du Nord est suffisamment faible compar�e � celle des sudistes plus qualifi�s.. Plusieurs �tudes r�centes sugg�rent effectivement que les �lasticit�s de compl�mentarit� chutent brutalement au-del� d'un certain �cart de qualification. Cependant, rien ne prouve que ces effets soient suffisamment forts pour que l'ouverture optimale des fronti�res du point de vue de la justice sociale
Recent concerns about the transfer of U.S. services jobs to overseas workers have deepened long-standing fears about the effects of trade on the domestic labor market. But a balanced view of the impact of trade requires that we consider jobs created through the production of U.S. exports as well as jobs lost to imports. A new measure of the jobs gained and lost in international trade flows suggests that the net number of U.S. jobs lost is relatively small-2.4 percent of total U.S. employment as of 2003.
The United States continues to run an international trade surplus in services, but business stories frequently appear about service-sector jobs moving offshore. Many Americans are particularly concerned about the loss of skilled, well-paid jobs in such fields as computer programming and accounting. These jobs seemed relatively secure at a time when many manufacturing jobs were being lost to import competition. Similarly, telephone call centers, once viewed as an economic development opportunity in some areas, increasingly are moving to low-wage countries, such as India and the Philippines. Reflecting this growing concern, some members of Congress and state legislators have focused attention on the offshoring of service jobs and production, even introducing legislation to limit the outsourcing of jobs to other countries. Offshoring raises many questions for policymakers and the general public. For example, which service jobs will be affected most by import competition? What are the most likely effects of service-sector offshoring on U.S. output, employment, and, most important, our standard of living? Is offshoring really a problem that requires restrictive government actions, or are other kinds of policies more appropriate to give Americans the highest possible living standard? ; Garner examines the economic effects of offshoring and possible policy responses. He finds that although the offshoring of service jobs hurts some workers, offshoring should not permanently lower U.S. employment or production. ; Moreover, the average living standard can benefit over the long run if the nation adopts policies to retrain displaced workers and move them into expanding industries.
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