LONDON: The number of people in offshore locations delivering software and IT
services (S/ITS) to the UK will double to over 130,000 in the coming three
years, according to a new study by Ovum on global sourcing.
Rather than fight this trend, Ovum advises UK firms to focus on
business-centric IT skills, as these will be critical to the success of both the
IT sector and the wider UK economy.
Based on research conducted with vendors accounting for more than half of the
UK S/ITS market, the report highlights a 6 per cent fall in the number of
UK-based S/ITS staff by the end of 2008. This equates to the loss of 5,000
onshore positions each year.
"We will see the UK-based S/ITS workforce shrink in size under the
effect of offshoring," says Phil Codling, senior analyst, Ovum. "But
the overall loss of jobs will be gradual and less dramatic than some
commentators might have you believe."
The bulk of the job reductions projected in the UK S/ITS industry will fall
in programming, other lower-level technical roles, call centre/help desk and
back-office corporate administration.
"These are functions that can readily be offshored and in some cases
automated. There is no point in trying to fight the drop-off in demand for such
roles onshore. UK S/ITS firms must focus on the fact that the key value of
onshore IT workers will be their ability to deliver innovative solutions in
close co-operation with end customers," says Codling.
He also emphasises that such business-centric skills drive the success and
competitive advantage not just of the UK's IT firms but also of technology
dependent sectors such as banking, insurance, telecommunications, media and even
government.
Ovum's research predicts that the number of UK-based staff hired by offshore
companies will continue to increase over the period, but not sufficiently to
offset the overall decline in UK S/ITS jobs.
"Offshore companies, particularly those from India such as TCS, Infosys
and Wipro, will continue to hire onshore in order to boost their presence closer
to customers in the UK and to support their rapid growth," Codling added.
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