The offshoring phenomenon looks poised to expand beyond the tech industry. In fact, some analysts say Infosys is looking at buying a pharmaceutical consultancy. That makes sense, because health care is the only industry segment that showed growth last year. On top of that, the Obama administration's stimulus package promises to inject billions into health care, although that is at least 12 to 18 months away from creating significant new business.
Vemuri says that we're seeing nothing more than talk when it comes to a health-care technology spending boom: "No one has stepped forward and made a significant spend." But think about it: What better time is there to buy an American healthcare consultancy than before the actual boom is under way?
And it's not just health care that may be ripe for offshoring. According to Vemuri, there is a lot of virgin territory in terms of industries that have not traditionally used outsourcers. New industries coming on to outsourcing bandwagon are media, entertainment, energy, utilities, space, heavy engineering, and manufacturing.
In addition, outsourcers are branching out offering new services like integration and change management. "Now we are getting called in to do that," Vemuri says.
More people may feel the offshoring angst if Vermuri is right.
Government jobs may not protect existing jobs at well, either
On the plus side, Pettibone says that the government is the fastest growing job sector in the country due to new regulations and systems expected soon from the Treasury Department, SEC, and FDIC. By law, the government work cannot be sent offshore. Still, it can be outsourced to places like Kentucky or North Dakota. You don't get the same "labor arbitrage" advantages there as you would in India or China, but they're still less expensive than New York or Boston, according to Pettibone.
But I wonder if that isn't another reason why Infosys is shopping around. Perhaps if it buys a U.S.-based business and keeps it here, it can pick up a lot of that government work, too, in those cheaper U.S. locales.
Well, that's what capitalism is all about: competition. It's supposed to up everybody's game and create the kind of vibrant economy that has given America one of the highest standards of living in the world. I guess we'll just have to wait and see if it continues to go that way for us.