More IT Jobs to Go Offshore, Controversial ITAA Report Says. (cover story)

The article discusses the report released in 2004 by the Information Technology Association of America (ITAA), a high-tech trade group's that lobbying the U.S. Congress in favor of offshoring, which concludes that more IT jobs will be created over the next five years, but the overall economy will get a boost from the cost savings that offshore outsourcing yields. The firm that conducted the research on behalf of the ITAA, Waltham, Massachusetts-based Global Insight Inc., found that while wages and jobs will increase in the economy overall, the outlook for IT workers may be less positive. The report's conclusion in support of offshore outsourcing drew much skepticism. The economists who conducted the research said history has demonstrated that free trade raises the standard of living in the U.S. The economy will experience more growth with offshore development than without it, the report concludes. IT employment will grow over the next five years, adding 516,000 jobs in the software and services sector. But 272,000 of those jobs will go offshore, with 244,000 remaining in the U.S. According to Lee Price, research director at the Washington-based Economic Policy Institute, the trend to offshore productive jobs in the U.S. economy is making the U.S. less productive. Nate Viall, a Des Moines-based recruiter who specializes in finding candidates for IBM iSeries application development, expressed concern that displaced workers may be inclined to retrain for iSeries development and in turn drive down wages for his recruits.