Strategic IT talent: Offshoring is not the answer

It’s been a common refrain for years, growing to a chorus in the election year of 2004. As technology workers rail against the exporting of IT jobs to India, China, the Philippines, and beyond, their would-be bosses bemoan an ever-shrinking IT talent pool.

Who’s right? Well, both are -- but not for the reasons you might expect.

Offshoring has had less of an effect on IT jobs than many people commonly believe, says Dice.com CEO Scot Melland. In part that’s because the overall percentage of IT jobs that has been exported is relatively low, according to Melland. Those jobs are mostly commodities: help desk, database administration, and some application development. Higher-end, more strategic jobs are still kept in-house and continue to be in great demand.

Another reason: Offshore is rapidly becoming “dual shore,” as Indian-based outsourcers expand their U.S. operations. For example, Mumbai-based Tata Consultancy Services says it plans to hire 1,000 stateside employees in 2006. As the Earth grows flatter, global companies find themselves in desperate need of project managers who can communicate with clients on one side of an ocean while managing employees on the other side.

Hiring to fill a niche

If there’s a talent gap, it’s at the high end, says Harry Wallaesa, founder of tech consultancy The W Group.

“I think the talent gap exists at the really innovative technical positions that are driving new business models and helping companies compete on a different level,” Wallaesa says. “They’re not the ones whose jobs get outsourced.”

The shortage lies not in the number of tech-savvy workers but in the types of skills and experience they possess. IT needs have become so granular that it’s difficult to find people who fit a particular niche, says Jim Lanzalotto, vice president of strategy and marketing at Yoh, a $367 million talent and outsourcing company based in Philadelphia.

“The talent gap is really a ‘specificity gap,’ ” Lanzalotto says. “Five years ago companies were looking for anyone with any experience in CRM. Today they want a CRM project manager with experience in a particular industry, such as manufacturing or pharmaceuticals. When you get that precise, you start to develop supply issues.”

Lauren Barker, manager of staffing at USi, an ERP managed services provider, says her company’s biggest challenge is finding .Net consultants. It’s not easy to find someone with the right mix of technical, business, and communication skills.

“It’s easy to find developers who make $60K or $70K to do coding,” Barker says. “It’s much harder to find a senior principal consultant who is able to travel to a client’s office, articulate what our developers will be able to do for them, then come back here to develop the project.”

A touch of gray

On the other hand, as baby boomers retire, companies face the opposite problem. “Twenty years ago you couldn’t get enough mainframe guys,” Yoh’s Lanzalotto says. “Now companies can’t find them at all. It’s not a cool technology, but it’s something companies still need to have in place.”

Federal and state governments, with their combination of aging workforce and legacy applications, will be especially hard hit, Dice’s Melland says.