Facts and Figures on Outsourcing

Understanding Outsourcing
Understanding Outsourcing

With all of the controversy about outsourcing, it can be helpful to look at facts and figures on outsourcing. The real truth about the impact of outsourcing is still difficult to determine. Getting armed with some facts will help you begin making sense of the arguments for and against outsourcing.

Some Facts and Figures on Outsourcing

Probably the question most people want to know is how many U.S. jobs have been lost to outsourcing? According to Techsunite.org, over 500,000 jobs have been outsourced since the year 2000. There have also been over 250,000 additional jobs lost due to outsourcing. The biggest culprits of outsourcing are IT companies.

Biggest Outsourcing Companies

According to Techsunite.org, the top 10 companies that have outsourced the most jobs, along with the number outsourced are:

  • IBM 63,700
  • EDS 22,400
  • Dell 17,450
  • Cognizant 15,000
  • Siemens AG 15,000
  • General Electric 14,250
  • Convergys 14,000
  • Accenture 13,000
  • Computer Sciences Corp 10,800
  • Intel 10,426

These 10 companies are by themselves responsible for outsourcing nearly 200,000 jobs.

Job Loss Projections

As bad as these outsourcing numbers look, it is only the tip of the projected iceberg. According to the U.S. Department of Labor and Forrester Research, Inc, outsourcing is expected to expand in numbers and scope.

Number of U.S. Jobs Moving Offshore
Job Category 2000 2005 2010 2015
Management 0 37,477 117,835 288,281
Business 10,787 61,252 161,722 348,028
Computer 27,171 108,991 276,954 472,632
Architecture 3,498 32,302 83,237 184,347
Life Sciences 0 3,677 14,478 36,770
Legal 1,793 14,220 34,673 74,642
Art, design 818 5,576 13,846 29,639
Sales 4,619 29,064 97,321 226,564
Office 53,987 295,034 791,034 1,659,310
Total 102,674 587,592 1,591,101 3,320,213

According to these projections, outsourcing is still in the beginning stages. As technology increases and companies learn more about exporting, the numbers will begin to skyrocket.

These numbers also should be a warning to "office" workers. This is the job category that will increase the most between 2005 and 2015. Some of these jobs are higher paying positions, such as accounting. Jobs that don't need direct, in-person human interaction are vulnerable. Also vulnerable are jobs that can be broken down logically into a process. Jobs requiring more creativity and decision making are safer, but not completely safe from being outsourced.

What are Safe Jobs?

All this bad news about the facts and figures on outsourcing may have you asking what jobs are really safe? Fortunately, some jobs either can't be outsourced or are unlikely to be sent overseas.

  • Health Care. Your health care provider needs to be in the same room as you in order to make a diagnosis or provide treatment. This means that health care will be a safe field as well as a growing field due to the aging population.
  • In-person services. The largest career field in this category is teaching. Any service which requires direct, in-person service is a good bet.
  • Real estate. While right now may not be a good time to be in real estate, in the long term these jobs are safe because someone overseas can't show you a home in your neighborhood. This category also includes construction workers.
  • Financial Services. Positions held by people who make financial decisions for individuals and companies are likely to be safe from outsourceing as well.
  • Security. The security industry is expected to continue growing, and of course these jobs can't be outsourced. Included in this category is military employment.

Is There any Good News?

Even though these facts and figures may seem grim, they don't paint the entire outsourcing picture. The government statistics, for example, only measure the actions of larger companies, usually companies with 50 or more employees. It is these large companies that are most likely to outsource. It doesn't take into consideration, however, that a lot of job growth comes from small companies. Even if small companies have work that could be outsourced, they are unlikely to do so because the savings isn't great enough.

Other factors that will offset these numbers include the aging population and the weak dollar. Baby boomers will start retiring in large numbers soon. The number of vacant positions they leave behind will likely far eclipse the jobs lost to outsourcing. In addition, if the dollar continues to be weak, the U.S. may experience more "in-sourcing" from foreign companies. A weak dollar means hiring American employees becomes cheaper, which could lead to more jobs being relocated here.

Conclusion

Outsourcing makes many people nervous, especially if you don't believe in the theory behind outsourcing. Regardless of what sector you work in, continuing to learn new skills will help you to keep your job or find a new one if your job is outsourced.

Facts and Figures on Outsourcing