Looks Like Plenty of U.S. Companies Send Work Offshore, After All

Ann All

I recently blogged about a Robert Half Technology survey in which just 6 percent of respondents said their companies sent work offshore -- a number that struck me and a number of other industry observers as awfully darned low.

An explanation offered by several folks, including CIO Insight blogger Brian Watson and Wall Street Journal blogger Ben Worthen, is that companies may not know -- or care -- whether their U.S.-based service providers like IBM and EDS send any tasks offshore.

A new survey of CFOs sheds further doubt on the Robert Half technology numbers.

Conducted by BDO Seidman LLP, it found that 49 percent of U.S. companies (all in the tech sector, and with annual revenues of $100 million to $15 billion) said they offshored some manufacturing or services outside the U.S. (That number matches up pretty closely with a CIO Insight survey, in which 45 percent of respondents said their companies engaged in offshoring.) The number was higher, 64 percent, for companies based in Silicon Valley.

And 79 percent of the respondents said their companies have non-U.S. business operations, reports InformationWeek.

Which tasks do companies offshore? According BDO Seidman's survey:

  • Manufacturing, 74 percent of companies
  • Programming and IT services, 51 percent
  • Research & development, 49 percent
  • Distribution, 45 percent
  • Call centers, 35 percent

The InformationWeek article also includes some interesting data on favored offshore destinations and on CFOs' top concerns about offshoring.

Add Comment      Leave a comment on this blog post
Mar 10, 2008 2:41 AM Mike Mike  says:
I'd say the difference is in the "Respondents" chosen for the surveys. I was recently informed by a lower-level manager at a company that I used to work for that his entire department was being outsourced to India. I did some research and found NO information about this 100+ person outsourcing project anywhere on the Internet. I asked two other people at the company what they knew, and neither of them was aware that this was happening. They were both lower level managers, but they worked in the SAME building as the department that is being outsourced. A higher level manager was aware of the project, but was not at liberty to divulge any information, as I expected.I would expect they'll outsource 80% of the IT functionality in the next ten years. That's why I left, after ten years, and started my own business. Reply
Mar 6, 2009 9:41 AM efyin efyin  says: in response to Mike

It would not happen that fast. USA is still a free country. However if there are some protectionist steps are taken against H1b, it will accelerate the outsourcing. A lot of people confuse H1b with outsourcing, however both of them has inverse co-relation. H1bs actually keep jobs here, while outsourcing move the job out of usa.


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