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Why IT jobs are never coming back

Stephanie Overby | Dec. 10, 2010
The combination of more automation, increased offshoring, and better global IT infrastructure has taken its toll on the U.S. IT profession

Jannsen: The whole bottom layer [of IT] has largely been removed from North America and Europe. A lot of the entry level roles are in India or China. How will companies fill the mid- and upper-level IT roles at the top of the pyramid if that supporting base of feeder roles is vanishing?

Jannsen: Companies are still struggling with that, and it's going to become a bigger and bigger problem. It requires a change in thinking about how they build talent and where they will find the future leaders. Some will develop special training programs for the handful of folks they need. Others will take the easier route and hire ready-made leaders from the big consulting firms. You're assuming the big IT service providers will continue to develop such talent in the U.S.

Jannsen: When I worked at EDS, we had big corporate training facilities-whole apartment complexes just full of people. Now those are in Hyderabad or Bangalore. They no longer have that kind of scaling availability here in the U.S.-the bulk may be in low-cost geographies-but they still have tens of thousands in the U.S. You predict that IT job loss will level off at around 115,000 jobs a year, at least until 2014. What happens after that?

Jannsen: In the corporate world, it's going to be a grizzly picture here. [Net IT job loss] could continue until 10, 15 years from now.

Padron: Even longer. You know, the Chinese are now outsourcing to South Africa because it's cheaper. [U.S. IT job loss] is going to go on for a long time. It could be 50 years.

Jannsen: Companies have to understand the global marketplace. What we have is an asymmetrical talent war. In Asia or India the question is, 'How do I hire 500 people?' In the U.S. it will be, 'How do I hire 5, 10, or 50?' In the U.S., they will be hiring professionals with very specialized industry skills, the ability to manage in the global context, or experience in new technologies. What happens to those hundreds of thousands of American IT professionals skilled in, say, programming or data center operations?

Padron: I was on a flight to Miami, and I met a 30-year-old QA auditor who had moved to Shanghai from Boise, Idaho. This isn't a high-level management job and those jobs are going to some folks in Europe and North America. He was a mid-level manager. This is really becoming a global war for talent. On the quasi-bright side, you say a weak dollar could mean transformational work will be done onshore. Is limited labor arbitrage really the only reason transformational projects would stay close to home? Are offshore IT organizations capable of handling major corporate change?


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