In all the discussion about outsourcing, one simple fact sometimes gets lost: Nobody beats the United States when it comes to people with IT skills. Taking into account the size and availability of the labor force, their education, relevant experience, language skills and turnover rates, A.T. Kearney ranked America tops in this area on its 2005 Global Services Location Index.
But labor arbitrage—cutting costs by exploiting the availability of lower-wage workers—remains the name of the game in IT sourcing. CIOs continue to seek savings through offshore outsourcing, and the Everest Research Institute predicts those savings will continue to drive sourcing offshore for the next 30 years. Today, 73 percent of Fortune 2000 companies say offshoring is an important part of their overall growth strategy, according to the 2005 Duke University CIBER/Archstone Consulting study. And Gartner predicts worldwide offshore spending will reach $50 billion next year.
