On the offshore outsourcing of IT projects: Status and issues

Abstract

Today countries such as India and China have thriving information technology (IT) industries performing projects that the US, Western Europe, and Japan have outsourced to take advantage of the substantially lower labor costs there. These countries have been able to service many small and large outsourced projects by deploying large numbers of workers skilled in the basics of IT. Although the current outsourcing practices afford certain benefits to the outsourcing countries, the migration of jobs and the large-scale rapid advances in IT in the countries that service the outsourced projects may have some troubling impacts on the outsourcing countries. In this article, I will review the status of the outsourcing practices, and consider the potential impacts on both sides of outsourcing.