Discussions about people at work - primarily business psychology, including the human side of outsourcing.
Outsourcing kills the IT job market - what now for IT recruitment?
Posted 4th September 2008 at 10:18 by Stephanie
An article in Computer Weekly highlighted the problem that the salaries for mid-level IT staff have increased due to greater demand due to Outsourcing. Companies need experienced staff capable of overseeing project work, managing virtual teams, negotiating service line agreements and so on (the hidden costs of outsourcing) – but they don’t need the lower level skills because most of those jobs have been outsourced to lower cost economies such as India.
It seems project managers and project leaders have seen quite dramatic pay increases (good news for some), but because all the lower level jobs have been outsourced or ‘offshored’ then there are fewer people to rise through the ranks. SSL (Salary Services Limited) carried out a study which clearly demonstrates the shift. Their research director George Molyneaux is quoted by Computer Weekly as saying that ‘Outsourcing jobs reduces the incentives to get into IT’. Not surprisingly, there are far fewer people taking IT as a subject at University – and there are fewer graduate level jobs in the UK. How on earth are we going to develop the future project managers who will understand the UK IT industry? I think this is a real time-bomb.
Yet the reply from one of the recruitment companies is that we need to increase marketing and highlight that there is a demand for IT people. Does this person think that today’s young people are completely stupid? It is clear from the above analysis that there are fewer jobs and no clear career path. The IT industry cannot continue to dump people like hot potatoes whenever they think they can get them cheaper elsewhere and then expect a good flow of graduates coming into their sector.
Better marketing is not going to resolve the issue. People will only start moving back into IT when they can see there really is a career for them.
There is a podcast about the drop in student numbers and the implications on the following link:
http://www.computerweekly.com/Articl...nt-numbers.htm
It seems project managers and project leaders have seen quite dramatic pay increases (good news for some), but because all the lower level jobs have been outsourced or ‘offshored’ then there are fewer people to rise through the ranks. SSL (Salary Services Limited) carried out a study which clearly demonstrates the shift. Their research director George Molyneaux is quoted by Computer Weekly as saying that ‘Outsourcing jobs reduces the incentives to get into IT’. Not surprisingly, there are far fewer people taking IT as a subject at University – and there are fewer graduate level jobs in the UK. How on earth are we going to develop the future project managers who will understand the UK IT industry? I think this is a real time-bomb.
Yet the reply from one of the recruitment companies is that we need to increase marketing and highlight that there is a demand for IT people. Does this person think that today’s young people are completely stupid? It is clear from the above analysis that there are fewer jobs and no clear career path. The IT industry cannot continue to dump people like hot potatoes whenever they think they can get them cheaper elsewhere and then expect a good flow of graduates coming into their sector.
Better marketing is not going to resolve the issue. People will only start moving back into IT when they can see there really is a career for them.
There is a podcast about the drop in student numbers and the implications on the following link:
http://www.computerweekly.com/Articl...nt-numbers.htm
Total Comments 1
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Hi Stephanie,
This was a good blog I had not thought about this issue until you raised it. One of the reasons sometimes stated for Outsourcing is that there is a shortage of skilled people in this country - now I see why! People do want to join famous companies and get on within them - I do not think pure IT companies like EDS offer quite the same attraction. People will simply not go into the IT world unless they can see a clear career path that can lead throughout an organisation to the top (potentially at least). It seems we may be causing the shortage and the IT Outsourcing market is creating the problem it purports to solve. It can be a time bomb both in terms of people who can manage IT in the future but also those who understand 'it' and its limitations. We are emphasing by this trend an already serious lack of understanding and competence in IT that mirrors where this country was 15 to 20 years ago when we lost our engineering competences as the engineering and manufacturing industry died. Cheers JB |
Posted 4th September 2008 at 19:57 by JohnBlack
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Recent Blog Entries by Stephanie
- Quality Accounts for NHS (21st November 2008)
- Bullying at work - we are all responsible (9th November 2008)
- Do not outsource a problem (21st September 2008)
- The human side of outsourcing - managing people change (13th September 2008)
- Outsourcing kills the IT job market - what now for IT recruitment? (4th September 2008)
