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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

Padron: Some are under the CFO because they started in finance, but they're migrating away from that. Sometimes, the CIO is in charge, particularly in companies with a business-oriented CIO like Merck or P&G or Dow.

CIO.Com: Offshoring isn't the only culprit in the loss of U.S. IT jobs; automation has also played a role. Which is having a bigger effect on employment prospect s for American IT professionals today?

Padron: Automation is still the preferred labor arbitrage strategy. Many companies have implemented great, new infrastructure and are saying how do we go to one instance of ERP, for example? How do we automate the next stage of work?

Jannsen: Automation has been the primary driver (of U.S. IT job loss). Looking forward, offshoring will have the biggest impact. At what stage is U.S. corporate IT in coming to terms with the new global-and asymmetrical-war for talent you describe.

Padron: The first thing that went offshore was the help desk and the data center. The next thing was programming. That's lagged a bit because companies still have a lot of legacy code-spaghetti code, some non-standard thing unique to that company-and it doesn't make sense to send that somewhere else. But as the next wave of standardization happens in the next few years, those unique requirements are going to go away.

Jannsen: One other constraint is the scale issue. Companies that are $5 to $10 billion [in revenue] are ahead of other companies. Globalization is just part of doing business. But if you're a midsize company in the Midwest. it takes a lot longer. They need to go that extra mile to compete globally. The only other option is automation.

Padron: A lot of what's inhibiting companies that should be doing this is cultural. There's a lack of management team understanding of how to do business in a global setting. They're just doing things the way they've always done it. What IT roles will remain stateside for now?

Padron: You have to separate the back office side from the customer facing capabilities. You'll see folks who can better integrate supply chains and do design and architecture. Customer and relationship management, those higher level strategic jobs will be retained.

We're not saying innovation in IT in the U.S. is dead by any stretch. A lot of innovation will continue to come from the U.S., but the masses of jobs will be elsewhere. We'll still see U.S. innovation in cloud computing create wonderful capabilities, but if it requires masses of programmers, they will be elsewhere.

Jannsen: Innovation will continue. It's an important part of who we are in the U.S. That combination of capital flow and entrepreneurialism is unique to America.


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